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Kgampi Bapela

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Kgampi Bapela

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Kgampi Bapela

  1. 1. Kgampi Bapela Regional Manager: Limpopo September 2018 Financing of IDC supported sectors
  2. 2. Positioning of Development Finance Institutions (DFIs) in South Africa’s financial landscape • Less-commercial focus • Fiscal transfers and grants • Development objectives (social) Government/ NGOs • High commercial focus • Private sector capital • Financial objectives • Known risks Commercial financiers • Commercial and development focus • Sharing risk • Internally generated funds, government funds, loans (DFIs) Greater importance on social and developmental objective Greater importance on financial objectives DFIs should not compete with other institutions, but should instead encourage cooperation to achieve their goals
  3. 3. IDC’s sector focus aligned with the States TourismBusiness process services Cultural & creative industries ICT Healthcare Mining related technologies Biotechnology Mineral beneficiation Agri-processing Forestry, paper & pulp furniture Metals fabrication, capital and transport equipment Automotives, components, medium and heavy commercial vehicles Plastics, pharmaceuticals, chemicals & cosmetics Other cross-sectoral funding areas: Venture Capital IDC activities are aligned to Government’s programme, driving increased economic activity in productive sectors and seeking to have a greater impact on job creation, inclusive wealth, provincial distribution of economic activity and regional development. IDC sectoral funding activities supports relevant areas of the NDP, NGP and IPAP NDP Focus Area NDP Focus Area IPAP Focus Area Boatbuilding Advanced Manufacturing Electronics Green Industry components Clothing, textiles, footwear, leather Mining
  4. 4. IDC’s sector focus aligned with the States Economic infrastructure Green industries Biofuels Logistics Industrial infrastructure Oil and gas IDC sectoral funding activities supports relevant areas of the NDP, NGP and IPAP NDP Focus Area NDP Focus Area IPAP Focus Area IDC activities are aligned to Government’s programme, driving increased economic activity in productive sectors and seeking to have a greater impact on job creation, inclusive wealth, provincial distribution of economic activity and regional development.
  5. 5. • Debt products: Long-term, capital/interest moratoriums, sculpted repayments • Mezzanine funding: Cash flow, quasi nature, structuring instrument • Equity instruments: For own account & share warehousing options – mainly strategic reasons • Other products: guarantees, trade finance, venture capital etc. IDC’s funding products Funding will be structured in a way that will suit the business’ needs most appropriately. Structuring options include: • Term of the funding: Short, medium and long-term loans are available; • Grace periods for repayment: Repayments can be structured to suit cash-flows and allow for periods where no payments need to be made on either capital or interest. • Special funding schemes are available that offer more attractive terms and targets cross-sectoral issues such as job creation or development of specific sectors. • IDC’s business support programme addresses non-financial support to entrepreneurs.
  6. 6. Customised structuringof eachtransaction SALIENT POINTS Community involvement in projects: • Funding structure • Expectation management • Corporate governance • Business management • Offtakes/market
  7. 7. Thank You

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