South African development finance institution debt levels to jump

Speaking at the Industrial Development Corporations (IDC) annual results presentation yesterday, CEO Geoffrey Qhena said the IDC will spend ZAR100bn on industrial development over the next five years.

Qhena said that the corporation’s “involvement with the Industrial Policy Action Plan (Ipap) will result in us investing much more”.

Ipap, which was tabled in Parliament in February 2010, builds on the country’s National Industrial Policy Framework and represents the South African government’s efforts to “promote the countries long term industrialization and industrial diversification”.


The IDC said that although its debt-to-equity ratio was set to increase to around 50% in the next five years from 4% currently, “its strong balance sheet can handle increased borrowing rates”. Qhena also alluded to the fact that it was looking to Asia to secure funds, saying “due to Africa’s growing relationship with China, we are talking much more to them”.

The agency also said it remained concerned over SA’s current “jobless growth” situation saying that it was a “big concern” and that it would not “wait for people to come to us looking for funding; we will start the projects ourselves and there will be an element of skills training as well”.