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Focussed funding on youth-owned businesses is a strategic priority

Regional Manager for the Industrial Development Corporation (IDC) in the North West, David McGluwa, expands on the diversity of projects funded by the corporation, from tourism and mining, to renewable energy, manufacturing and agro-processing.

Having obtained qualifications in commerce, finance and executive management, culminating in a Masters in Business Leadership, David McGluwa worked in various financial fields including trade, debt and international financing. He has led the North West office of the IDC since 2008 and is a member of a national infrastructure commission, Strategic Project 8 (Green Industries).

David McGluwa
Most people associate the North West with mining, but the regional economy is in fact quite diverse. Where should entrepreneurs be looking for opportunity?

Mining remains the key driver of economic growth and job creation in the Province. However, there are many other sectors that provide opportunities for investors and entrepreneurs in the North West. The tourism sector arguably provides the biggest opportunities, with prominent National Parks Pilanesberg and Madikwe being home to the big five. Other tourism key points include Hartbeespoortdam, Sun City, Bloemhof Dam, the Taung Skull and Taung Dam as well as the city of Mahikeng.

In the manufacturing sector there are opportunities worth pursuing in automotive components, mining supplies, the localisation of imported goods and cultural artefacts.

Agriculture is a big feature of the North West’s economy and there are good prospects in processing (sunflower, feed and vegetables) and in various schemes such as the Taung Irrigation Scheme and the new concept of Agri-Parks, which will create opportunities for storage and trade.

Both the green economy and waste management offer business owners a chance to run sustainable businesses while at the same time contributing to cleaner energy provision and cleaner communities. Photo-voltaic solar units can be manufactured and the opportunities for waste collection, baling, processing and recycling will always be with us.

What sort of projects has the IDC supported in the course of funding 52 projects?

We have a diverse portfolio of projects ranging from mining, tourism, agriculture, manufacturing and healthcare. Youth-owned businesses in the province have recently received IDC funding of R124-million, which created 109 direct jobs. We also funded a sub-acute hospital, Care Cure Thaneze in Mahikeng, which is majority owned by black women, and it is doing extremely well. IDC also funded Momentous Energy, a solar farm outside of Rustenburg, 17% of which is owned by the community around Marikana.

Are there opportunities for entrepreneurs to get involved in the beneficiation of mining products?

The Platinum Valley Special Economic Zone (SEZ) will certainly boost beneficiation initiatives in the province. Hydrogen South Africa (HySA), based at the North West University’s Potchefstroom Campus, is working on exciting game-changing initiatives that will further boost beneficiation. The province is also host to the country’s only platinum incubator, the Seda Platinum Incubator (SPI) which has produced many entrepreneurs in jewellery manufacturing. The IDC is involved in all of these important initiatives, the SEZ, HySA and SPI.

What is the North West branch doing to empower youth, women and black-owned businesses in the province?

The IDC recently set aside R4.5-billion to finance youth-owned enterprises in South Africa, with R1-billion of that being offered at the very attractive lending rate of prime less 3%. In the last two years we have approved R124-million to youth-owned entities. We have an intentional and focussed strategy to fund many more youth-owned entities in the North West.

The IDC also funded 13 projects in the province where women have a significant stake and we intend to disburse R23-billion to black industrialists over the next five years. Black empowered companies in the North West Province currently receive R5.6-billion (90%) of IDC funding.

What levels of funding will flow from the IDC in the near future?

The IDC plans to disburse R100-billion over the next five years into the South African economy. There is no set amount allocated per province, it is the responsibility of each provincial office to ensure that their province gets its equitable stake. The North West currently contributes 6% to the SA GDP and I am confident that we can disburse a significant amount of funding into the North West economy over the next five years.

Published in the 2017 edition of North West Business

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