25 February 2011
In a bid to stimulate economic growth and help create jobs, South Africa’s Industrial Development Corporation (IDC) has set up a five-year, R10-billion scheme that will provide businesses with loans at a rate of three percent below prime.
Addressing journalists in Pretoria on Tuesday, IDC chief executive Geoffrey Qhena said the IDC was now focusing on realigning with the country’s New Growth Path, which was announced by the government in November.
“It can’t be business as usual,” Qhena said of the funding that will be available to job creation projects from 1 March 2011.
“This will be across all IDC-mandated sectors to businesses which demonstrate economic merit and efficiency in new job creation,” Qhena said, adding that the scheme was set to run over a five-year period.
On repayment of funding granted to businesses, the state-owned development institution would be more accommodative, particularly for businesses that were starting out.
“We want to ensure that people have access to this facility and that it caters for the requirements of a business,” he said.
Creating new industries
Existing businesses as well as new start-ups would qualify for the funding: “We want to encourage entrepreneurs,” Qhena said, adding that the IDC wanted to help in the creation of new industries.
In addition to the R10-billion, the IDC has set aside R750-million to assist businesses that were affected by the recent floods and drought. Of this money, R500-million would go to assist businesses that fell within the mandate of the IDC at prime less three percent.
“The remaining R250-million will be loaned to the Land Bank to assist those affected agricultural businesses that fall outside the IDC’s mandate,” Qhena said.
Applications for this fund will start on 1 March 2011 and end on 31 March 2012.