The Industrial Development Corporation (IDC) has launched a R1.5 billion funding package in response to the civil unrest, looting and destruction of property thToeaat occurred in parts of the country. The unrest, mainly in KwaZulu-Natal and parts of Gauteng, resulted in the tragic loss of life and a negative impact on the economy and livelihoods.
The IDC’s R1.5 billion Post Unrest Business Recovery package includes funding support for businesses and communities impacted by the unrest. This package is a part of the R3.75 billion comprehensive economic recovery package recently announced by the Minister of Trade, Industry and Competition, Mr Ebrahim Patel.
“We began monitoring the negative impact soon after the civil unrest flared up. Our exposure to key sectors of the economy and feedback from our affected client base spread across the country, particularly in KwaZulu-Natal and Gauteng, gave us insights into the impact on business activity,” says IDC CEO TP Nchocho.
Nchocho is particularly concerned about the lasting impact of the unrest on the local and regional supply chains. Export-oriented businesses in KwaZulu-Natal might lose out on opportunities in the long- term if business confidence remains affected.
R1.4 billion of the total package is earmarked to assist businesses (existing and new clients) in select sectors. The funding will be available at concessionary rates to give businesses a better chance to rebuild. Bridging loans for insurance payouts will be offered at 0%, with other debt facilities priced at prime plus 1%.
IDC has also set aside a R100 million regional programmes grant for technical and financial assistance to small businesses in townships, rural areas, and small towns affected by the unrest and associated supply chain disruptions.
In Gauteng, the Corporation will partner with the Gauteng Enterprise Propeller which has set aside R50 million to co-invest with IDC on the proposed R100 million grant funding. In addition, the IDC will be administering the dtic’s R400 million Manufacturing Competitiveness Enhancement Programme (MCEP) Economic Stabilisation Fund.
The fund will support manufacturing companies affected by the unrest, including those impacted by associated supply chain disruptions. The fund will offer concessionary funding to affected companies through interest free loans.
Through its CSI programme, IDC has further allocated R 10 million towards food and social security and recovery efforts in affected communities. This funding will cater for school infrastructure rebuilding and support for care facilities and clinics.
“Our CSI response will focus mainly be on rural, outlying and less developed areas that now face increased vulnerability. We will be working with our established NGO partners to ensure reach and impact,” Nchocho added.
Article sourced from the IDC website
