Page 16 - IDC

6 CITY PRESS, 17 JULY, 2016

IDC’s Heavy Manufacturing BookDC s H
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I IDC’s Light Manufacturing and Tourism Booksm BookD o okkkkk
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business the past five y ears 108 Number of businesses funded in the past five y ears
83 Number of businesses funded in
R2 083 100 000 Total investment in South African companiees R2 420 000 000 Total investment in South African companiees

R1 016 400 000 Total investment in other African companies R4 949 900 000 Total investment in other African companiees

WHERE THE BUSINESSES ARE WHERE THE BUSINESSES ARE

Eastern Cape Northern Cape Eastern Cape Northern Cape
Number of businesses: 8 Number of businesses: 2 Number of businesses: 5 Number of businesses: 2
Investment value: R273 200 000 Investment value: R95 000 000 Investment value: R309 800 000 Investment value: R27 900 000

Free State Western Cape Free State Western Cape
Number of businesses: 3 Number of businesses: 3 Number of businesses: 3 Number of businesses: 12
Investment value: R12 100 000 Investment value: R10 900 000 Investment value: R4 300 000 Investment value: R143 000 000

Gauteng Ethiopia Gauteng Botswana
Number of businesses: 27 Number of businesses: 1 Number of businesses: 51 Number of businesses: 1
Investment value: R446 300 000 Investment value: R74 400 000 Investment value: R1 725 300 000 Investment value: R29 100 000

KwaZulu-Natal Mozambique KwaZulu-Natal Ghana
Number of businesses: 16 Number of businesses: 2 Number of businesses: 10 Number of businesses: 1
Investment value: R369 100 000 Investment value: R372 400 000 Investment value: R53 300 000 Investment value: R933 100 000

Limpopo Namibia Limpopo Uganda
Number of businesses: 5 Number of businesses: 1 Number of businesses: 6 Number of businesses: 1
Investment value: R25 900 000 Investment value: R288 600 000 Investment value: R70 300 000 Investment value: R1 468 000 000

Mpumalanga Rwanda Mpumalanga Mozambique
Number of businesses: 12 Number of businesses: 1 Number of businesses: 9 Number of b usinesses: 1
Investment value: R840 900 000 Investment value: R75 900 000 Investment value: R43 500 000 Investment value: R99 700 000

North West Swaziland North West
Number o f b usinesses: 1 Number of businesses: 1 Number of businesses: 6
Investment value: R9 800 000 Investment value: R205 100 000 Investment value: R42 700 000
KwaZulu-Natal
IDC’s Media and Motion Picture Book Number of b usinesses: 3
Investment value: R22 100 000
Eastern Cape Limpopo
49 Total number of businesses Number of businesses: 2 Number of businesses: 2
Investment value: R2 200 000 Investment value: R9 100 000
R295 400 000 Total investment in SA companies
Free State Western Cape
R118 800 000 Total investment in Nigeria Number of businesses: 2 Number of businesses: 17
Investment value: R2 200 000 Investment value: R121 100 000
William Smith, the IDC’s
WHERE THE BUSINESSES ARE Gauteng Nigeria executive r esponsible for
Number of businesses: 1
Number of businesses: 22
Investment value: R138 700 000 Investment value: R118 800 0 00 high impact and regions
Source: IDC ISABELLA MAAKE, Graphics24
ne of South Africa’s growth areas of the future is its
budding digital animation sector, responsible for GOING FOR
internationally successful feature films such as Khumba The IDC will
(2013) and Adventures in Zambezia (2012).
That’s the view of William Smith of the Industrial help with your
ODevelopment Corporation (IDC), who envisages a
bustling central “animation hub” to keep the country’s animation MAXIMUM business plan
creatives constantly and productively employed – retaining their skills
here instead of their being tempted to seek their fortunes overseas.
And there are plenty of other opportunities for those with the right
vision and drive, particularly following the SABC’s recent decision to
beef up its local television content quota to a staggering 80%. “Some entrepreneurs have a sound business
“This is the time for entrepreneurs to stand up and come forward concept, but they battle to get it into a business
with their stories,” Smith urges. impact plan,” says Smith.
Smith was recently appointed the IDC’s divisional executive in charge If you’re in that boat, there’s no need to panic
of “high-impact” industries as well as the regional offices. But he’s – the consultants at the IDC’s regional offices
served at the government’s industrial funding arm in various capacities will sit down and discuss the nuts and bolts of
for the past 23 years and knows his way around development finance. your dream venture with you.
He’s hyped about using IDC funding to turn South Africa’s industry into The entity has 14 manned regional offices
a “world-class player”, particularly through his area of responsibility: countrywide in addition to a number of smaller
the country’s high-impact industrial sectors. satellite offices with staff that operate on an ap-
“High impact is where we can, for minimal effort, achieve the pointment basis.
biggest impact,” he explains. Like any bank or development finance institu-
“We’re looking at the sectors that are already established and do not tion, the IDC needs reassurance that you’ve
require us to develop a whole value chain. We can go in to fund them The IDC has identified creative industries as an important thought through your business concept, put in
and achieve job creation, or transform them, for minimum effort. We the hard yards and done financial forecasts be-
want to get the maximum bang for our buck.” fore approving your proposal. But you don’t have
The sectors in his portfolio include heavy industry (glass, cement, focus area for growth, writes Christina Kennedy to do the hard slog alone.
bricks, rubber products); light manufacturing (ICT, furniture, scientific “At the IDC regional offices, you can go in for
equipment); and tourism (hotel developments, a chat and sit across a table from someone to
tourist attractions); and media and motion discuss your idea,” explains Smith, who set up
pictures. the network of offices some years ago.
The Africa support unit also falls “There, you can share ideas, and get advice
under his ambit. and guidance on how to compile a business
Two years ago, he explains, the A plan. They will then screen the business plans
IDC realised that it “cannot fund and help the applicants fill in the gaps. When
everything” and that it would be PROJECT IN it’s at the stage where it’s bankable, they’ll send
prudent to focus on those areas it to head office [in Johannesburg], where we’ll
where its investments could PARTNERSHIP do the due diligence on it.”
have the most impact on the He adds: “We’ve found those initial interac-
economy. WITH THE tions very important. Youth entrepreneurs, in
With the help of consultants, particular, need guidance.”
the IDC isolated the industrial Since the offices were set up around the
sectors – such as metals and country, up to 60% of IDC funding applications
mining, chemicals and agriculture IDC emanate from them.
– where value chains should be “The offices have definitely influenced the
supported and developed, as well as geographical spread of our funding,” says Smith.
the high-impact sectors, laden with “We are trying to get funding to the whole of
potential, where a minimal financial outlay South Africa – to go out of the metros to facili-
could set in motion a significant effect. ANIMATED Adventures in Zambezia’s main protagonist is AERIAL The state-of-the-art Cape Town Film studios where tate rural transactions.”
The IDC’s media and motion picture unit is the one about which Kai the falcon : the TV show Black Sails is filmed
Smith is the most excited, considering its vast employment potential as
well as the country’s growing international stature as a sought-after Women doing it
film production destination.
“We have a huge focus on the film, television and radio sector, and for themselves
we can do so much more,” says Smith. “Not so much the big
blockbusters, but on a smaller scale, the local stories … We have the Female entrepreneurs are rolling up their
market for it and big players such as the SABC and Multichoice have sleeves to create jobs and earn a living. Some of
hardly scratched the surface in the rest of Africa in terms of selling our the projects the IDC’s high-impact division has
product. If we can come up with enough stories and scripts, we have a funded offer proof that, even on the factory floor,
huge industry we can support.” South Africa’s women aren’t afraid to get their
In the past, the IDC has funded successful local films such as the hands dirty. Here are some success stories:
Oscar-winning Tsotsi and the Nelson Mandela Biopic Mandela: Long
Walk to Freedom. Since Cape Town Film Studios opened in 2010, Heavy manufacturing
productions, including 19 major feature films and four seasons of TV’s . Sam’s Tissues – a R140 million paper mill
emmy award winning Black Sails, using the studios have spent more owned by black female industrialists that will
than R2 billion and created job opportunities for more than 77 500 create 94 jobs;
people. . Sacks Packaging – a paper bag
Adds Smith: “ we are focusing on developing black film producers manufacturing plant owned by black
and directors. The IDC’s Emerging Black Filmmakers Transformation industrialists that will create 238 jobs; and
Fund was established specifically for this purpose, which I think is quite . Maloka Machaba – an asphalt road-surfacing
groundbreaking. So we are inviting them to come to us with their start-up in Limpopo headed by young black
feature film scripts and their local stories.” AMANDLA Mandela: Long Walk to Freedom stars Idris Elba ACCLAIMED Presley Chweneyagae in the Oscar-winning women.
The IDC funding works in tandem with a bouquet of public as former president Nelson Mandela film Tsotsi
initiatives to boost the local film industry – from the department of Light manufacturing
trade and industry’s incentive schemes to the funding cycles of the that of jewellery manufacturing. South Africa has long been criticised the entry point into Africa should be South Africa. . The IDC will soon conclude a Wholesale
National Film and Video Foundation. for mining ample precious metals, yet not beneficiating them at source, “So we need to look at how to get those entities to set up here, Gold Loan Scheme with a precious metal
The scripts (and any initiatives that are funded) also have to show instead allowing the bulk of the country’s raw materials to be benefiting South Africa, and then move into the rest of Africa.” refinery for on-lending to local jewellery
“economic viability and sustainability”. processed into finished products – which have higher export values – Smith says there is a lot of confusion about the IDC’s mandate and manufacturers. The aim of the scheme is to
“We are in the business of creating long-term sustainable jobs, not outside the country. precisely what it funds: initiatives that boost competitiveness, create make gold available at competitive prices to
short-term initiatives,” Smith explains. In heavy manufacturing, there are opportunities for modernisation jobs, grow the economy and foster transformation in the industrial reduce raw material input costs and increase
The entity enlists people with knowledge of the movie industry to to make companies more competitive. And when it comes to tourism, sector and not in retail, for example. local production of jewellery ,which will
advise producers on what is likely to work from a commercial point of the sector is ripe for the picking, says Smith. Included in that mandate is targeting rural communities, women and facilitate an increase in the export of jewellery.
view, because the money invested will have to be repaid so that the “South Africa has reached near capacity in terms of rooms, but young people to become the next generation of visionary industrialists.
IDC can “recycle” it back into other projects. serious effort is still required to transform the industry. Locally, we are Here, Smith says, the IDC has “far exceeded” its target of funding Tourism
Smith warns that an IDC investment in your business is not money focusing on the smaller operators and the expansion of existing female entrepreneurs in the past year. . The IDC has funded construction of four
for jam – there are no free lunches on offer for vanity projects. businesses. But there are major opportunities in the rest of Africa, He says that funding any business is always a risk and the funding new hotels – one each in Polokwane, Limpopo,
Entrepreneurs have to “have skin in the game”, as he puts it – they where we can have the biggest impact tourism wise.” pool is not bottomless, but he assures enterprising people with shape- Ghana, Uganda and Mozambique. All of the
must co-invest their own money, however, if they want the IDC to The IDC also has an eye trained firmly on the continent with its “rest shifting ideas that “if there’s a good transaction that comes in, and if hotels are nearing completion and will
cough up in kind. of Africa” unit. Smith says that, as international markets become it’s viable and meets the IDC objectives, we’ll fund it – we’ll find the commence operations this financial year.
Besides film and animation, another exciting sphere of opportunity is saturated, many businesses are looking to Africa for expansion – and money”.