Industrial Development Corporation 30 June 2011 ANNUAL REPORT 2011 Geoffrey Qhena CEO 12 October...

Industrial Development Corporation

30 June 2011

ANNUAL REPORT 2011

Geoffrey QhenaCEO

12 October 2011

2

Presentation Structure

• Financial Results

• Operational Overview

• Case Studies

• Prospects

Financial Results

4

Abridged Group Statements of Comprehensive Incomefor the Year Ended 31 March

R’mGroup2011

Actual

Group2010

Actual% Change

Revenue 8 965 7 785 15 Cost of sales 3 444 2 565 34 Financing costs 346 528 (34)Gross profit 5 175 4 692 10 Other income 131 159 (18)Operating expenses 3 057 3 416 (11)Net income before capital gains 2 249 1 435 57 Net capital gains 36 573 (94)Net operating income after capital gains 2 285 2 008 14 Share of profit/(loss) of equity-accounted investments 633 40 1 483Profit before tax 2 918 2 048 42 Taxation 206 (181) NMF Profit for the year 2 712 2 229 22 Other comprehensive income 10 886 12 406 (12)Total comprehensive income 13 598 14 635 (7)

5

Sources of Income

Sources of Income (financing activities)

902 998

2 150 1 461

2 183 980

1 307

3 164

414

790 533

698

835

775

1 114

323

703

-668

119

121

454

432

481

-2 000

-1 000

-

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

2007 2008 2009 2010 2011

R m

illio

n

Other

Preference shares incomeInterest

Dividends - unlisted

Dividends - listed

6

Abridged Statements of Financial Positionas at 31 March 2011

R’m Group Group% Change 2011 2010

Actual Actual Assets Cash and cash equivalents 5 828 2 866 103Loans and advances 12 053 10 374 16Investments 81 971 68 891 19PPE and inventories 5 838 5 012 16Other assets 1 116 1 488 (25)Total assets 106 806 88 631 21Equity Share capital 1 393 1 393 - Reserves 91 333 77 796 17Total equity attributable to holders of parent 92 726 79 189 17Non-controlling interest 342 366 (7)Liabilities Loans 6 677 3 527 89Deferred taxation liability 5 011 3 795 32Creditors and provisions 2 050 1 754 17Total liabilities 13 738 9 076 51Total equity and liabilities 106 806 88 631 21

7

Balance Sheet Items for the Last 5 years

Balance Sheet Items for the Last 5 years (financing activities)

5.1 6.1 8.8 9.8 11.6 10.8 11.2

12.7 13.0

14.1

39.0 51.6 40.3

61.4

71.8

11% 8% 8%

5%7%

31%29%

42%

29% 29%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

0

20

40

60

80

100

120

2007 2008 2009 2010 2011

Deb

t/eq

uity

ratio

(%)

Bala

nce

shee

t ite

ms (

R bi

llion

)

Revaluation of investments

Investments at cost

Loans and advances

Debt/Equity ratio

Debt/Equity ratio (incl.commitments)

8

Borrowings

Borrowings (financing activities)

4 736 4 659 4 430 3 709

5 371

1 617 1 595 1 463

527

1 978

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

2007 2008 2009 2010 2011

R m

illio

n Rand based

Foreign currency based

Operational Overview

10

Objectives and the outcomes that we aim to achieve

…facilitating sustainable direct and indirect employment…regional equity

…growing the entrepreneur and SME sector…expansionary and/or broad-based black economic empowerment

…environmentally sustainable growth…sectoral diversity and increase localisation

support for industrial capacity developmentBy focussing on...

We will contribute to...

10

… proactively identifying and funding high-impact projects… leading the creation of viable new industries… using our diverse industry expertise to drive growth in priority sectors… taking up higher-risk funding in early-stage and high-impact projectsWe differentiate

ourselves by...

11

Highlights

• Net funding approvals for South African based development of R8.4 billion;

• Impact on South African job creation improved with approvals during the year expected to create 19 650 full time jobs and save an additional 11 650 with a combined impact on employment of 31 300– An additional 8 100 jobs expected to be created through direct linkages to

activities in the informal economy.• Alignment of operations with New Growth Path (NGP) and IPAP2;

– 97% of new investment approvals in the priority sectors as identified in the NGP.

– R1.5 billion approved to companies through the UIF bond, creating and saving more than 17 000 jobs;

• Successful interventions in manufacturing to sustain and increase job creation:– R646 million approved for businesses in the clothing and textiles industry to

curb job losses and increase competitiveness with an additional R648 million approved for schemes managed on behalf of the dti targeting the industry.

– R1.7 billion approved for investments in the motor vehicle industry covering both assembly as well as component manufacturers, some of which were in distress.

0

2

4

6

8

10

12

14

06/07 07/08 08/09 09/10 10/11

Val

ue o

f Fun

ding

App

rova

ls (

R'bn

) Outside South Africa South Africa

Value of Funding Approvals

0

5

10

15

20

25

30

35

40

45

06/07 07/08 08/09 09/10 10/11N

umbe

r of J

obs

('000

)

Direct impact on 2nd economy jobsSavedExpected to be created

Impact on South African Employment

12

Supporting Industrial Capacity Development

• The manufacturing industry received the largest portion of funding.– R1.7 billion approved for motor vehicles and components

industry– R646 million was approved in the clothing and textiles industry

to support distressed companies and assist with competitiveness improvements;

• Infrastructure investments related mostly to funding for the construction industry and telecommunications infrastructure, with hospital infrastructure also receiving a significant portion of funding;

• Funding in the mining value chain was considerably lower than in previous years. Funding approved focussed on coal mining;

• Although funding the green economy is still a new area for IDC, several transactions were funded, including the roll-out of solar water heaters and a co-generation project.

Value of Funding Approvals(2010/11)

Infrastructure(16%)

Mining Value Chain(16%)

Manufacturing(27%)

Green Economy(13%)

Knowledge Economy(4%)Tourism & High Level Services(3%)

African Development(10%)

Not Aligned to NGP (3%)

Agricultural Value Chain(7%)

13

Eastern Cape2

8%

Free State4

%

Gauteng2

7%

KwaZulu N

atal

12%

Limpopo5

%

Mpumalanga7

%

North West3

%

Northern C

ape

2%

Western Cape 1

2%

Regional Distribution of Funding

• 49% of approvals during the year destined for developments in provinces other than Gauteng, the Western Cape and KwaZulu-Natal compared to the 36% that these provinces contribute to SA’s economy.

Examples of industries supported by province in 2010/11:Eastern Cape• Motor vehicle production and

components• Assembly of televisions• HospitalFree State• Chicken abattoirGauteng• Motor vehicle production and

components• PharmaceuticalsKwaZulu Natal• Electricity co-generation• Motor vehicle components• Jewellery

Limpopo•Agro-industriesMpumalanga•Mining services•Electricity pylonsNorth West•Motor vehicle componentsNorthern Cape•Malt productionWestern Cape•Film studios•Clothing•Agro-industries

Distribution of Value of Funding Approvals(2010/11)

14

Regional Distribution of Funding (continued)

-

100

200

300

400

500

600

700

-

2

4

6

8

10

12

GD

P (R

'bn

2009

; 200

5 pr

ices

)

IDC

Appr

oval

s (R

'bn)

IDC Approvals (lhs)Provincial GDP (rhs)

-

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

- 5 000

10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 50 000

Num

ber o

f em

ploy

ed p

eopl

e (t

hous

ands

)

Expe

cted

Jobs

Cre

ated

/Sav

ed th

roug

h ID

C Ap

prov

als

IDC Approvals (lhs)Provincial Employment (rhs)

• Over the past 5 years, the 47% of IDC’s funding were destined for provinces that are at a lower level of industrialisation (all provinces except Gauteng, Western Cape and KwaZulu-Natal) – these provinces contribute to 34% of the country’s economy and is evidence of IDC’s role in balancing regional economic activity.

Value of Funding Approvals and Provincial GDP Impact on Jobs and Provincial Employment

Case Studies

16

IDC Focus Area: Green Industries

Renewable energy: Non-fuel power

Wind Power

Generation

Concentrated Solar Power

Solar Photo Voltaic Power

Energy efficiency

Heat, Electricity &

building efficiency

Cleaner production /

Industrial Efficiency

Transport Efficiency

Fuel based energy

Waste to Energy

Co-generation

Bio-fuels

Bio Ethanol

Bio Diesel

Emission and pollution mitigation

Air pollution control

Water & treatment

Waste Management/

Recycling

Clean stoves

Services related to renewable

energy & energy efficiency

Local manufacturing

related to renewable energy

& energy efficiency

The establishment of a unit focusing on green industries allows IDC to cover a range of sectors related to environmental products and services

16

17

Green Industries

• Solar Academy of Sub-Saharan Africa– The IDC approved funding for the roll-out of 200 000 solar water

heaters to the South African market. The company has a diversified portfolio of projects including the mass roll out of the low pressure SWH, high pressure SWH and investigating opportunities within the renewable energy space.

– The low pressure SWH project is the first programmatic CDM SWH Carbon Project globally to be registered at the UNFCCC.

– The project has rolled out 60,000 LPSWH units to the impoverished RDP Communities, uplifting their standards of living by providing them with hot water on tap, benefiting at least 240,000 individuals.

– The project supports localisation and in doing so gas established a local manufacturing plant.

– 535 local job opportunities were created. The second phase of training will see 10% of all installers being trained to become qualified plumbers.

Sustaining and creating jobs

Building a new industry

Green industry

Gauteng

North West

Eastern Cape

KwaZulu-Natal

Western Cape

Free State

18

Green Industries

• SA Calcium Carbide– SA Calcium Carbide is the only producer of calcium carbide in

Africa, through the beneficiation of local limestone and coal mineral resources.

– The company uses a large portion of the electricity supplied to the town of Newcastle.

– Apart from the strain put on the electricity supply, recent tariff hikes will result in significantly higher production costs.

– IDC will provide funding to assist with the installation of a co-generation facility, utilising furnace off-gas currently being flared, to reduce the company’s reliance on the national grid for electricity.

– Co-generation promotes energy efficiency and reduces the use of coal in power stations and hence qualifies for carbon emissions reductions.

Green industry KwaZulu-Natal

19

Agro-Industrialisation

IDC Focus Area: Agro-Industries

Demand side

International demand

Other (niche and new products)

By focussing its efforts on agro-industries IDC will increase demand for labour intensive primary agricultural products and add value to currently produced products

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Supply side

Value addition

Import replacemen

tImproved

competitiveness

Primary agriculture Creating backward

linkages to drive job creation and rural

development

Legend

IDC focus areas

Linkages to other industries

20

Agro-Industries

• Peppadew™ International– Peppadew International (Pty) Ltd manufactures products based on

the unique “Sweet Piquanté Peppers” and markets them locally and internationally under the Peppadew™ brand.

– The company started in the late 1990s and has a processing facility in Nkowankowa, Limpopo, sourcing produce for processing through contracts with farmers in the surrounding region and its operations in Peru.

– The economic crisis negatively affected the company in 2009 and projected sales growth failed to materialise. As a result, Peppadew received a working capital facility from the IDC to meet working capital requirements for the 2011 production season.

– The IDC funding will save 1 700 jobs in the factories and farms contracted to supply the peppers.

– The funding offers additional potential for the IDC to partner with Peppadew to fund further land reform projects and establish a wholesale facility to fund emerging black farmers

– The funding will also contribute towards the preservation of a uniquely South African international brand.

Sustaining jobs

Rural development

Supporting exports of South African products

Limpopo

21

Agro-Industries

• The Noodle Factory– This start-up in the Western Cape, will manufacture instant noodles,

which would previously have been imported from Asia.. – The IDC approved a loan for the Noodle Factory for the

establishment of a greenfields noodle production factory. The funds will be used for the construction and completion of the factory, for working capital and to acquire equipment.

– This project will beneficiate low value commodities (wheat flour and vegetable oil) into higher value products.

– This operation will create 21 direct jobs in Philippi and it has the potential to create more jobs once it expands.


Expansionary BEE

Import replacement

Adding value to raw materials

Developing a new industry Western Cape

22

Agro-Industries

• Green Farms Nut Company (GNFC)– Part of the biggest nut processing operations in South Africa with

processing factories in Mpumalanga, KZN and Limpopo.– Established in 1991 to process macadamia nuts in the Levubu area

in Limpopo.– IDC approved a loan facility to Green Farms Nut to upgrade its

existing factory and provide a more competitive service to both its growers and customers.

– The upgrade will result in a doubling of capacity over the next five years.

– GNFC, together with the European Union, supported the Vhembe Co-Operative, owned by ±350 Black Farmers for the establishment of macadamia production in the area.

– The company is currently in talks with the local Ravele community to establish a joint venture to dehusk and dry nuts for the benefit of small scale emerging farmers.


Labour intensive industry

Limpopo

23

Agro-Industries

• Grainfield Chickens– GFC will be a new sizable chicken (broiler) abattoir in the Free

State;– With a first phase capacity of slaughtering 160 000 chickens per

day, it will be the fifth largest in the country;– At the end of the first phase of the project, it will be employing 780

people directly;– Suppliers to the project will be setting up their own chicken houses,

adding to the employment impact of the project;– Through the project, c.a. 80 000 tons of maize will be beneficiated

annually and imports of frozen chickens will be replaced.


Broad based black ownership for workers

Replacing imports

Introducing competition in the domestic industry

Free State

24

Agro-Industries

• Dynamic Commodities– Established in 1996 and relocated to Coega IDZ in 2006 with

assistance from IDC;– Manufactures sorbet and other frozen fruit based products for the

export market;– IDC provided various loans over the years and has recently

approved another application for expansionary funding – Currently employs 860 people (annualised figure) with another 92

jobs (annualised) to be created.

Establishing a new industry

Assisting exporters

Assisting small enterprises to expand

Eastern Cape

25

IDC Focus Area: AutomotiveSector, Fabricated Metals and Capital Equipment

IDC’s efforts in this industry revolve around increasing local content

25

Automotive sectorAutomotive assembly

Legend

IDC focus areas

Linkages to other industries

Component manufacturer

s

Downstream metalsFabricated

metalsCapital equipment

SOE Capex programmes creates demand for locally produced goods

26

Automotive Sector, Fabricated Metals and Capital Equipment

• Africa Cellular Towers– The company was established in 1999 to fabricate, supply and

erect lattice towers for the telecoms industry;– In 2007 the company took a decision to diversify by expanding into

the electrical transmission and distribution industry;– The company was awarded tenders by Eskom to install power lines

and approached IDC to assist with the funding required to deliver on these contracts;

– IDC approved funding to cover the purchase of equipment, working capital requirements as well as a guarantee facility;

– The funding provided by IDC will assist the company to retain its existing labour force and create another 220 full-time equivalent jobs during the implementation of the contracts.


Black empowered business

Localising SOE capital expenditure

Limpopo

North WestMpumalanga

27

Automotive Sector, Fabricated Metals and Capital Equipment

• Electro Inductive Industries– The company was established in 1999 with IDC’s support as a

small fledgling service and distribution centre for electrical transformers;

– Have been able to grow to a fully fledged original equipment manufacturer with the third highest market share in the domestic market;

– During the year, IDC provided funding to the company to sustain its operations through renewal of revolving credit facilities and guarantees as well as conversion of portions of its revolving credit facility to loans;

– The transaction saved 220 jobs.


Assisting SMEs to expand

Expansionary BEE

Production of capital equipment

Western Cape

28

IDC Focus Area: Other Manufacturing Industries

Other Manufacturing Industries

Clothing, textiles, footwear, leather

Pharmaceuticals

Plastics and chemicals

Non-metallic minerals

Etc.Advanced

manufacturing

29


• Econo-Heat™ Energy Efficient Appliances– The company was formed in 1990 to manufacture innovative and

safe wall mounted heaters that are more energy efficient compared to competitor products;

– It has a strong presence in the local market and exports to 38 countries across the globe;

– They employ 109 workers in their Wetton, Cape Town factory;– The company, which has been expanding over the past few years,

has been funded for working capital requirements to deliver on local and export orders.

– The funding will allow the company to sustain current operations and fulfil potentially growing orders.

Creating and sustaining jobs

Supporting exports of South African products

Western Cape

30


• Ellen Arthur– Ellen Arthur was originally founded in 1959 as a cut, make and trim

manufacturer of blouses for a major South African retailer.– It has since expanded to design and manufacture a range of ladies

clothing;– The company saw margins reducing and ultimately losing orders to

domestic and international competitors as retailers put pressure on manufacturers to cut prices in an effort to maintain their margins;

– IDC provided a guarantee to allow the company to retain its overdraft facilities at a commercial bank that is vital for the company’s working capital requirements;

– IDC’s facility will assist the company to reconfigure their business to cater for a wider range of clients and diversify its client base;

– 460 jobs have been saved as a result of the transaction.

Sustaining jobs


Black-empowered business

Western Cape

31


• Chic Shoe Manufacturers– Chic Shoes was established in 2004 following the closure of a shoe

factory in Cape Town. This was done partly through funding raised from IDC;

– The company has grown from strength to strength and is ready to expand following an opportunity to supply several footwear ranges to a major South African retailer;

– With most of the funding IDC provided in the past paid up, the company approached IDC for new funding and a guarantee facility to assist the company with working capital requirements for the expanded capacity was approved;

– 64 new jobs will be created in addition to the 120 currently employed.

Creating new jobs


Expansionary BEE

Assisting SMEs to expand

Western Cape

32


• Synthecon Surgical Sutures– Synthecon is a local sterile surgical sutures manufacturer and

distributor based in Isando. The company manufactures about 400 different sutures based on needle type and size, which are used to close the edges of wounds or incisions and to repair damaged tissue.

– Synthecon has achieved a number of milestones since inception, including SABS certification for its products.

– The company has successfully penetrated the export market, providing sales in Malawi, Mozambique, Swaziland, Uganda, Rwanda and Mauritius.

– The initial funding created 45 jobs, mainly for women, with an additional 13 jobs created through the latest funding package.


SME development

Supporting exports of SA products

Localisation

Gauteng

33


• WG Wearne– WG Wearne was incorporated in 1910 by the Wearne family and is

a significant player in the ready mix concrete, aggregate and building materials market. The company has successfully grown since inception and has been profitable until 2008.

– Wearne’s operates across the country and employs people at its quarries, as well as through its distribution system.

– The economic crisis and the downturn in the construction industry resulted in declining demand for the company’s products.

– During the year IDC approved funding to assist the company with its turnaround strategy and in the process save 700 jobs.

Saving jobs

Broad-based ownership

Gauteng

North West

KwaZulu-Natal

Free State

Limpopo

34


• Vektronix– Vektronix was established in 1974 as SATV and was one of the first

television manufacturing plants in the country;– The company has since expanded to other products and is today a

cost-effective electronics contract manufacturer;– The company had been assembling CRT televisions for a major

South Korean manufacturer for 6 years and in 2009, the company was awarded a contract to assemble flat panel (plasma, LCD) televisions for the same manufacturer;

– Initially the company applied for a guarantee facility from IDC to enable it to meet the requirements of its international supplier.

– This was subsequently increased to meet additional demand in the previous financial year based on the company’s good performance.



Domestic value addition

Black-empowered company

Eastern Cape

35


• Pharma-Q– Pharma-Q contract manufactures and packages pharmaceuticals

from its facility in Industria, Gauteng;– The company services more than 30 leading global companies for

a diverse range of products including ampoules, dental cartridges, eye drops, oral syrups, sprays, topical ointments, tablets and capsules;

– As a result of changed regulations by the Medicines Controls Council, the company had to upgrade its facilities and at the same time modernise its plant and introduce new equipment;

– IDC approved funding to enable the company to upgrade and modernise , this should enable it to more aggressively enter the export market.

Improving competitiveness

Supporting exports of value added products

Improving efficiencies

Gauteng

36

IDC Focus Area: The Mining Value Chain

IDC is involved in funding extractive mining activities and encourages local downstream beneficiation

36

The Mining Value Chain

Stage 1 beneficiation (e.g. smelted or refined

products)

Extraction

Stage 2 beneficiation (e.g.

alloys)Stage 3

beneficiation (e.g. semi-manufactured

articles)Stage 4 beneficiation (e.g. fabricated articles)

37


• Diesel Power Opencast Mining– Diesel Power Opencast Mining is an opencast contract mining and

earthmoving contractor. Diesel Power was established in the mid 1980’s and is now one of the largest opencast contract mining and earthmoving contractors in SA;

– The slowdown in the world economy resulted in a surplus of second-hand fleet, which significantly reduced used fleet prices.

– This, together with the tougher credit climate, resulted in Diesel Power not being able to replace its fleet timeously resulting in downtime which negatively impacted the performance of the business since March 2009.

– The IDC facility will enable Diesel Power to replace a portion of its fleet thereby reducing maintenance costs and downtime and restoring the business to profitability, saving 1 357 permanent jobs.

Sustaining jobs

Mpumalanga

38


• Creative Design Manufacturers– Creative Design Manufacturers was established in 1995 with the

aim of providing quality gold jewellery chains to the local and export markets;

– During its previous expansions, the company received funding from IDC which has been fully repaid.

– The company currently manufactures yellow gold chains, bangles and earrings and it needed working capital to expand its product range to include white gold jewellery;

– The working capital facility approved in 2010/11 will assist the company to expand its operations and create 4 new jobs in the process.

Creating jobs

Downstream minerals beneficiation

Assisting SMEs to expand KwaZulu-Natal

39

IDC Focus Area: Tourism, creative industries and high-level services

Tourism, creative industries and high-level services Film

Tourism

ICT

Healthcare services

Etc.

40

High-Level Services, the Knowledge Economy, Tourism and Film

• Cape Town Film Studios– Cape Town Film Studios was built in response to a call by the

Western Cape Provincial Government, the City of Cape Town and Wesgro for proposals to invest in and build a film studio in Cape Town;

– The construction of the 4 sound stages and 2 workshops have been completed and these are the only studios in Africa suitable for the production of big budget movies;

– Shooting of the first film to use the studio, the big budget new Judge Dredd production completed earlier in the year and at the height of the production saw 400 South Africans and 50 top internationals working at the studios;

– The SA Film value chain will benefit from attracting more and bigger films into SA for production.

– IDC’s investment in the studio will provide local movie makers with world class facilities.

Creating jobs

Improving competitiveness Western Cape

41

High-Level Services, the Knowledge Economy, Tourism and Film• Mkambati Collection

– Establishment of a 18 room lodge within the Mkambati Nature Reserve in a remote area of the Eastern Cape with tourism potential;

– Although the reserve is under the management of the Eastern Cape Park Board, the lodge will be developed on community owned land following a successful land claim;

– The largest portion of the concession fee to be paid by the operators will benefit the community.

– 60 people will be permanently employed once construction, which will create 160 jobs over a 12 month period is finished.

Creating jobs

Development of a poor area

Community empowerment Eastern Cape

Prospects

43

IDC Sectoral Focus Areas

Green and energy saving

industriesBio

fuels

The green economy

Agro-processi

ng

Agricultural value chain Tourism

Business process services

Tourism, creative industries and high-level servicesCraft and film

ICT

Healthcare

Mining related

technologies

Biotechnology

The mining value chain

Downstream mineral

beneficiation

Mining

Logistics, infrastructure and cross-sector projects

Industrial infrastru

cture

Logistics

Metals fabrication, capital and transport

equipment

Automotives, components, medium and

heavy commercial vehicles

Plastics and chemicalsClothing,

textiles, footwear, leather

Forestry, paper & pulp,

furniture

Advanced manufacturin

g

Manufacturing activities

Pharmaceuti-cals

Oil and gas

R22.4 billion

R7.7 billion

R20.8 billion

R22.1 billion

R11.1 billion

R14.8 billion

Grreen industry

components

Other funding areas :Venture Capital: R500 millionFunding to distressed companies: R2.5 billion

R102 billion funding available in the next five years.

44

Improved Stakeholder Relations

Regional Roadshows• Purpose

– To improve the IDC’s understanding of its stakeholders’ needs;– To identify constraints that prevent business from expanding;– To identify opportunities for job creation;– To increase awareness on IDC product and service offerings. • Targeted groups– Entrepreneurs;– DFIs/Provincial development agencies;– Business Chambers/ Associations leaders.

Inter-Governmental Cooperation• Purpose

– To understand different government departments’ strategies and focus areas and to foster cooperation and coordination at a high level;

• Departments engaged– Health;– Public Enterprises;– Trade and Industry;– Mineral Resources.

Improved Turnaround Times• Purpose– To reduce turnaround times on applications to

acceptable levels;• Target– To reduce the time from an investigation

commencing to the day that the funding agreement gets send to the client to 15 days.

45

Challenges

• Uncertain economic climate– Fears that developing countries are entering another recession will have a negative impact on South Africa’s

economy and could undermine efforts to address unemployment;– Market demand would slow down resulting in lower capacity utilisation;– Low business confidence would delay investment decisions reducing demand for funding;– Fluctuations in the currency;

• Government processes– Water licences – Good improvements over the past few months, but challenges remain in some areas (e.g.

Orange farms in the Northern Cape);– Decision making on strategic projects (Project Mafutha, Project Mthombo);– EIA process delaying project development (e.g. titanium and zirconium beneficiation project , production of

aluminium trifluoride & hydrofluoric acid, manufacture of glass bottles);– Feed-in tariffs for co-generation ;

46

GovernmentLabour

BusinessCivil Society

Co-funders

Co-operation Needed from all Role-Players for IDC and the Country to Achieve its Objectives

47

Prospects

Thank you

Industrial Development Corporation19 Fredman Drive, SandownPO Box 784055, Sandton, 2146South AfricaTelephone 011 269 3000Facsimile 011 269 2116E-mail [email protected]

Industrial Development Corporation 30 June 2011 ANNUAL REPORT 2011 Geoffrey Qhena CEO 12 October...

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Transcript of Industrial Development Corporation 30 June 2011 ANNUAL REPORT 2011 Geoffrey Qhena CEO 12 October...