IDC funding has created 18 206 new jobs
A TOTAL of 18 206 new jobs were expected to be created and a further 2 675 jobs retained that would otherwise have been lost by financing approvals in the year to March by the Industrial Development Corporation (IDC), the stateowned development finance institution.
IDC chief executive Geoffrey Qhena said yesterday that supporting the creation of black industrialist remained a strategic imperative for the corporation.
Qhena said approvals for the programme increased 68 percent in the year March to R4.7 billion in 83 transactions while youth-empowered and youth-owned businesses increased 137 percent to R2.3bn in 52 transactions from R970 million in 19 transactions in 2016.
Qhena said support women-empowered businesses almost tripled to R3.2bn from R1.1bn.
“Supporting the growth of black business, including empowering women and youth entrepreneurs, is viewed as a lever for the increased participation of black industrialists in the economy, thus contributing to its transformation.
“We will, however, strive to ensure timeous investment flows into the economy in order to expedite developmental impact,” he said.
The disbursements increased, despite total funding decreasing marginally in the year to R11bn from R11.4bn in the previous year, mostly as a result of clients delaying the implementation of investment plans because of the challenging economic environment.
The corporation said these disbursements should also be seen in the context of the downward trend in the level of fixed investment in the manufacturing sector as a whole during the year.
The IDC said 75 percent of financing approvals were for capacity for new start-ups and capacity expansions while 13 percent were for companies experiencing difficulties.
The corporation yesterday reported a significant increase in group profit to R2.2bn from R223m in the previous year.
Funding approvals increased to R15.3bn largely on the back of a 42.8 percent reduction in impairments and write-offs and despite a loss of R902m in Foskor and R787m in the Scaw Group.
Qhena said the process to conclude the restructuring of Scaw Group was being finalised and was expected to result in the introduction of strategic equity partners for its main operating divisions.
The IDC holds 74 percent of the issued share capital of Scaw Group, which has six distinct divisions.
They are cast products, grinding media, wire rod products, rolled products, scrap processing and distribution network.
The IDC said management in November committed to a plan to dispose of the grinding media and cast products divisions.
“At year-end, management is in negotiations with potential buyers and the sale is expected to be finalised within the next financial year,” it said.
The IDC said the planned disposal of the two divisions was part of a single plan to dispose of Scaw and was in line with the IDC’s intention to introduce strategic equity partners.
IDC chairperson Busisiwe Mabuza said the corporation’s balance sheet remained strong, with assets growing to R129.8bn.