IDC to hike funding fivefold
Johannesburg - The Industrial Development Corporation (IDC) expects to increase its funding approvals for businesses more than fivefold in the next five years to aid economic growth and development.
"The IDC expects its loans and advances to increase to approximately R50bn in the next five years," wrote chief executive Geoff Qhena in the latest annual report. The figure in financial 2010 was R12.5bn, a 17% increase in disbursements and loans from the R10.6bn achieved in financial 2008.
Its funding approvals of R9.4bn in financial 2010 were the second-highest in the organisation's history and was likely to create up to 32 000 jobs, said IDC acting chairperson Monhla Hlahla.
The IDC also tried to aid economic development in rural areas by quadrupling its funding of investments in those areas to R4.6bn.
"The overall levels of approvals, at R9.4bn was the second-highest on record and is likely to result in the creation and saving of more than 25 000 jobs in South Africa and approximately 7 000 in the rest of the African continent," wrote Hlahla.
Move to go green
The R9.4bn was topped only by the R10.8bn funding approval of 2008, when the SA economy was in recession. Qhena wrote in the same report that 2009 was "unlike anything" the IDC had experienced.
It "remained a critical port of call" for businesses struggling to keep their operations afloat under the extreme economic recession experienced two years ago, said Hlahla.
Such companies received R1.4bn from the corporation's distressed companies' fund. The funding is estimated to have saved more than 8 800 jobs in a number of industries, including the clothing and textile sector.
Hlahla said the IDC has also positioned itself to play a key role in the development of alternative sources of energy.
"Our commitment to the development of green industries is reflected in the R11.7bn budgeted for investments in this area over the next five years," said Hlahla.
A large bulk of the funding, R8.3bn, would be for feasibility studies into wind farms, solar thermal and photo-voltaic electricity generation. A total R33m has been approved for exploring the feasibility of several wind farms and solar thermal photo-voltaic plants in the Northern Cape.