The African Development Bank Group (AfDB) has approved a private-sector multicurrency line of credit of $100-million and R1.3-billion to South Africa’s Industrial Development Corporation (IDC).
This will support industrialisation projects in South Africa and in other regional member countries.
Fifty per cent of the funding will be used for projects in South Africa and the balance will be directed to regional projects in Mozambique, Malawi, Ghana, Kenya, Namibia, Mauritius, Swaziland and Sudan.
This is the third nonsovereign-guaranteed line of credit from the AfDB.
The recently concluded extended supervision of the previous facility indicated that its support resulted in the creation and retention of over 15 000 jobs as it supported the agroprocessing, logistics and transport industries, as well as other industry infrastructure in Senegal, Zimbabwe, Mozambique and Swaziland.
“This project is timely, considering current economic challenges in South Africa, as the AfDB and the IDC together can play a countercyclical role,” the AfDB said in a statement.
The bank further said that support was much needed, as raising funds was becoming more difficult for South Africa and State-owned entities, such as the IDC, owing to the country’s sovereign downgrade.
The project will address the IDC’s funding gap and reduce asset-liability mismatch.