Trade, Industry and Competition Minister Ebrahim Patel has called on the Industrial Development Corporation (IDC) to pull up its socks in supporting black businesses and promoting localisation. Patel noted that the IDC’s performance in the transformation of the economy in the previous financial year lagged and showed a need for the corporation to intensify its focus on its mandate to develop black-owned and women-owned enterprises.
Patel made these remarks in the IDC’s annual report for the 2021/2022 financial year, which was released earlier this week. According to Patel, the IDC spent a total of R6.2 billion on transformation efforts, which was below its R8.1 billion target. Patel noted that the IDC should strengthen its focus on including women and youth entrepreneurs in the economy.
“Black industrialists are contributing significantly to the South African economy and the IDC’s role as a partner, enabler and financier can be stepped up further,” he said. He also criticised the IDC’s localisation efforts, recommending that it steer long-term industrialisation by boosting various sectors’ master plans, which were at the centre of localisation efforts and the fight against unemployment.
“To ensure jobs-rich industrialisation, the corporation will need to assist in the acceleration of the various industry master plans, support township economies and promote deeper localisation by investing in local industrial capacity,” the minister said.
“Given the current energy challenges, it will need to support efforts such as enabling the development of a strong and commercially viable local component base for the Renewal Energy Independent Power Producer Procurement Programme (REIPPP) and Green Hydrogen Action Plan, which seeks to diversify the country’s energy generation mix.”
In spite of these recommendations, Patel noted that the IDC improved in its efforts to support businesses in need during the previous financial year. He said that the IDC provided support to businesses affected by the July 2021 unrest in Gauteng and KwaZulu-Natal, and approved 90 transactions that were valued at R2 billion, assisting businesses that employed a total of 26,840 workers.
IDC board chairperson Busi Mabuza said that the IDC demonstrated its commitment to transformation, which was evident in its support of black industrialists, black-owned companies and women, and youth entrepreneurs. According to Mabuza, R4.1 billion was approved for black industrialists, R5.3 billion for black-owned and empowered businesses, R1.1 billion for women-owned businesses, and R386 million for youth-owned enterprises.
“Our role in the sustainable development of industrial capacity in South Africa and the continent is entrenched,” she said. Also, Mabuza said that the IDC’s corporate plan for the next couple of years cemented its commitment to employment creation initiatives, including support for industry master plans the township economies and administration of the Social Employment Fund.