DAVIES REVIEWS LOAN and EVERYTHING IS ILLUMINATED
TRADE and Industry Minister Rob Davies is reviewing a report from the National Empowerment fund (NEF) on the granting of a R34-million loan to media mogul Khanyi Dhlomo’s Ndalo Luxury Ventures (NLV) to open a high-end Luminance store in Hyde Park.
The NEF has since run out of funds for further loans.
Sidwell Medupe, spokesman for the Department of Trade and Industry, has confirmed that Davies has received the report and “is considering it”.
He said the minister would respond only after reviewing the report.
Both Dhlomo and NEF chief executive Philisiwe Mthethwa have defended the loan, saying it was within the NEF’s mandate.
“The NEF supports NLV primarily because it is a move towards transforming a sector which has remained unbalanced in terms of race and ownership in management,” said Mthethwa in her address at the launch.
In a letter addressed to Sunday World, Dhlomo says the NLV contributed R15-million towards the venture. Dhlomo and her mother, Venetia, are majority shareholders, while medical practitioner and businesswoman Judy Dlamini is a director and investor in the business. (See Page 11)
“The NEF funding for NLV is neither a gift nor a grant. It’s a loan to be paid up with interest within the time frame stipulated by the NEF,” says Dhlomo.
Davies had called for a report from the NEF to establish whether the funding was within the fund’s mandate.
His call was supported by the Southern African Clothing & Textile Workers ’ Union which described the loan as “inappropriate ”.
NEF spokesman Moemise Motsepe told Sunday World: “The mandate of the NEF is to grow black entrepreneurs.
“We don’t place a sell-by date on black success. We’ll fund small and medium enterprises.”
Asked whether the NEF has funded Dhlomo or Ndalo, Motsepe said: “No, this is a start-up business. We ’ ve never funded Ndalo Luxury Ventures before.
“We ’ ve funded Power FM, where she’s an 8% minority shareholder. There ’ s no ethical transgression in what we’ve funded.”
Sunday World has received several complaints from entrepreneurs who had been turned down for loans by the NEF.
Among them is Lino Makana (29) who, with her husband and business partner, Qaiks, applied for funding from the NEF last year.
“We were excited about it, but they shattered me. I was very sad, but it’s life; we have to move on,” she said this week.
The couple from Meyersdal, south of Joburg, were seeking funding to support their solar energy enterprise, but were declined despite revising their application to include recommendations and letters of support from potential clients.
“After reading the (NLV) story, this has had a negative impact on us,” said Lino.
“We ’ d like to know why a person who ’ s already a millionaire needs to get extra millions.”
The Makana couple say they submitted their business proposal last August – around the same time Dhlomo’s loan was approved – and were told in September to amend it because it didn’t meet all the requirements.
“We resubmitted it based on those requirements, but they came back and said we needed other things which they didn’t want before,” said Qaiks.
The couple, who say their business would have also employed 50 people, said they needed a cash injection of R4.8-million.
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