IDC fund­ing has cre­ated 18 206 new jobs

The Star Early Edition - - BUSINESS REPORT - Roy Cokayne

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.

PHOTO: TI­MOTHY BERNARD

The IDC build­ing in Sand­ton. Cre­at­ing black in­dus­tri­al­ist is a strate­gic im­per­a­tive for the cor­po­ra­tion.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.