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The Ministry of Industry and Commerce has applied to Treasury for US$100 million that would be used as seed capital to recapitalise the Industrial Development Corporation and other State enterprises affected by the liquidity crunch in the economy.
IDC is a wholly Government-owned investment company and the initiative to recapitalise it is part of economic solutions contained in
the new Zimbabwe Agenda for Sustainable Socio-Economic Transformation.
Speaking at a Confederation of Zimbabwe Industries business breakfast meeting yesterday, Industry and Commerce Permanent Secretary Mrs Abigail Shonhiwa said Government was committed to funding IDC in the same manner it has been funding other bodies like Agribank.
“As you are aware the Government unveiled a new economic blueprint, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation which is tailored to pursue a new trajectory of accelerated economic growth and wealth creation and anchored on indigenisation, empowerment and employment creation.
“Therefore, recapitalisation of IDC is one of the things that are included in the blueprint as we are trying to come up with initiatives that can revive the industry,” she said.
“We submitted the proposal for seed capital from Treasury to inject life into IDC and it is our wish to see the Industrial Development Corporation assisting in the growth of the manufacturing sector in the same way that Agribank does to the agriculture sector,” she said.
The seed capital is supposed to be allocated to all Government investment companies that have been facing financial challenges.
In an interview last year, IDC general manager Mr Mike Ndudzo said that they were looking for capital to restore normal operations at IDC-owned companies.
“All our subsidiaries are in need of fresh capital injection and it’s a miracle that they are still operating.
“We are therefore looking for strategic partners with the capacity to inject about US$140 million in total, a move which will stimulate production in these subsidiaries,” he said.
IDC has been courting suitors for cash to recapitalise its ailing subsidiaries, with officials indicating they were looking for about US$140 million.
IDC controls more than 15 companies with interests across different industrial sectors.
The group, founded in 1963 through an Act of Parliament, is a self-financing, national development finance institution.
Its associate companies include Olivine Industries, Zimbabwe Grain Bag (49 percent), Sunway City (97 percent), Sino-Zimbabwe Cement Company (35 percent), Modzone Enterprises (17,62 percent), Almin Metal Industries and several other companies.
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