Presented by: Andile Reve Executive Vice-President (Sectors)

1. Report back to - Trade and Industry Portfolio Committee Presented by: Andile Reve Executive Vice-President (Sectors) March 2001

2. Contents • Vision, Mission and Core Strategies • A transformed IDC • The past financial year (2000) • The current financial year (2001) • IDC managed government programmes

3. Vision ... “To be the primary driving force of commercially sustainable industrial development and innovation to the benefit of South and southern Africa”

4. Mission ... • Contribute to the generation of balanced, sustainable economic growth in southern Africa • Economically empower the southern African population • Promote entrepreneurship through the building of competitive industries and enterprises based on sound business principles

5. Core Strategies ... 4 Providing risk capital to widest range of industrial projects • Maintaining its financial independence • internal profitability • divestments from mature assets • borrowings Identifying and supporting opportunities not yetaddressed by the market Establishing local and global involvement & partnerships in projects that are rooted in or benefit SA and SADC Building upon and investing in human capital in ways that systematically and increasingly reflect the diversity of SA’s society

6. Contents • Vision, Mission and Core Strategies • A transformed IDC • The past financial year (2000) • The current financial year (2001) • IDC managed government programmes

7. The successful completion of an internal restructuring exercise within the IDC and the introduction of client focused SBU’s and processes, improved finance approval lead times, reduced by about two thirds. CEO / President Khaya Ngqula Professional Services Marius Mostert Sectors Andile Reve Projects Jaco Kriek Financial and Funding Gert Gouws HR and Corporate Support Services Lesé Matlhape 16 departments are tasked with providing the necessary operational services to the SBUs 13 strategic business units (SBUs), each focussed on specific economic sectors IDC’s Operational Structure ...

8. IDC’s Focus Areas • Empowering of emerging entrepreneurs • Support manufacturing, tourism development, agro-industries and small-scale mining • New initiatives: • telecommunications and IT • retail and service sectors • government tenders • venture capital • Continue with the establishment of internationally competitive, large, resource-based beneficiation projects and downstream value-added industries • Regional (SADC and Africa) development

9. IDC’s involvement in the rest of Africa ... • IDC’s current SADC involvement: 30 projects in 9 SADC countries • The IDC’s investment portfolio in the SADC region (excl. SA): • aluminium smelting, • mining activities, • agriculture, • manufacturing and • tourism. • Mandate extended to invest in the whole of Africa

10. Contents • Vision, Mission and Core Strategies • A transformed IDC • The past financial year (2000) • The current financial year (2001) • IDC managed government programmes

11. R Annual Highlights • Increased investment assistance amounting to R4.2 billion vs. R3.3 billion in 99/00 (about 5.9% of national fixed investment); • Total number of approvals increased by 78%over 99/00; • Approval of a R300m venture capital fund; • The registration of Exim Finance; • The introduction of a flood relieve scheme (total value R300 million); and • The IDC’s involvement within SADC was enhanced and nowcomprises 30 projects. 11

12. IDC’s Financial Results ... • Financially strong - Assets = R17.4 billion - Retained income = R631 million • Ranked 29th in South Africa’s “Giants League” i.t.o. assets • Ranked 4th largest SA public corporation i.t.o. assets and 5th largest i.t.o net income

13. 2000 1999 % Change Net income from operating activities 860 752 14 Associated entities’ net retained loss (683) (177) Net capital profits 503 46 Net income before taxation 680 621 10 Taxation (4) (199) Net income after taxation 684 820 (17) Minority interest (3) 2 Net attributable income for the year 681 822 Dividend 50 50 Retained income for the year 631 772 Abridged Consolidated Income Statements for the year ended 30 June (R’mil)

14. 2000 1999 % Change Financing of industrial undertakings 14 290 15 029 (5) Fixed assets and loans 1 352 1 181 Other assets 1 792 1 743 Total assets 17 434 17 953 Capital and reserves 10 760 10 129 6 Outside shareholders’ interest 2 58 Long-term liabilities 5 276 6 299 (16) Other liabilities 1 396 1 467 Total funds 17 434 17 953 Debt / Equity ration 49% 62% Abridged Consolidated Balance Sheets as at 30 June (R’mil)

15. Performance: SBU approvals ...

16. Investments facilitated during 2000: • Contributed 5.9% to manufacturing investment in productive capacity IDC’s Development Impact ... • Created 17 600 additional jobs • Maintained 1 233 permanent jobs • Assisted 415 industrialists • Generated R4 bn additional annual export earnings

17. Credit facilities for delivery on government contracts Approvals to empowerment firms % of total number of approvals 27% 30% Wholesale financing Warehousing of shares 19% 20% 14% 9% 10% 6% 0% 1996 1997 1998 1999 2000 Loan finance Take-overs and acquisitions Empowerment Financing ...

18. SME: Authorisations (R million) 600 1998 1999 2000 500 400 R million 300 200 100 0 <R1m R1 - R10m R10 - R20m R20 - R60m Total assets SME Financing ... SME financing’s value - from 11% of approvals in 1996 to 42.3% in 2000

19. Promoted non-metropolitan development(54% of total number of approvals) 6% 4% 20% 23% 7% 5% 4% 4% 2% 3% 20% 14% 2% 15% 16% 7% % of total approvals excl. Saldanha - Value - Number 17% 23% Performance: Regional Development ... Approvals:July 1996 to June 2000

20. Contents • Vision, Mission and Core Strategies • A transformed IDC • The past financial year (2000) • The current financial year (2001) • IDC managed government programmes

21. 24% Targets: SBU approvals (2001) • 6% increase in number compared to 99/00 actuals • Value of approvals likely to increase by 14% by year-end from last year • Aim to accomplish a morebalanced portfolio(sectoral and regional)

22. Contents • Vision, Mission and Core Strategies • A transformed IDC • The past financial year (2000) • The current financial year (2001) • IDC managed government programmes

23. Management of Government Programmes Name of Fund Funder/Donor Purpose Funds under management Support Programme for DTI Technology Promotion R109m per year Industrial Innovation Dept of Minerals & Development of small scale mining Small Mining Fund R9,82m Energy ventures Enhance productive efficiency through training of the social partners, and the Workplace Challenge DTI R0,470m application of best in practice principles Fund transferred to NPI Draft new legal framework for South Danida DTI/Danish Aid R0,365m Africa business Facilitate restructuring of DTI and Norwegian Grant Fund DTI/Norwegian Aid R2,1m associated institutions Widening and deepening of empowerment by assisting "Black" National Empowerment Fund DTI/IDC (R100m each) R5,105m (at historic cost) businesses with equity participation IDC handles establishment of fund Research fund focussing on international FRIDGE DTI R14m per year competitive capability of local industry 23