IDC funded youth businesses in Limpopo set to thrive

Date: 08 July 2017 By: Andries van Zyl

The Industrial Development Corporation (IDC) is tapping into the economic potential of youth-owned businesses in Limpopo.

Through the regional office, the IDC is injecting millions into stimulating the provincial economy by growing young entrepreneurs. “Youth unemployment continues to be one of the biggest challenges facing the country. The IDC in response to this challenge is proactively promoting initiatives which encourage more youth to create jobs and build sustainable businesses,” said Kgampi Bapela, IDC regional manager in Limpopo, in a press release.

In a provincial economy driven by agriculture and agro-processing, the IDC has injected millions into funding 100% youth-owned businesses in this key sector.

Seshego-based Mufama Bellegings (“Mufama”), is a business started in February 2013 by Carlo Snyman. He was a young farmer specialising in the production of cherry peppers and, along with other farmers, sent the raw cherry peppers to a factory in Musina for processing. This company, unfortunately, experienced problems due to floods that struck the area in January 2013.

This unfortunate situation left grower farmers, including Mufama, with huge potential losses. Mufama rescued the situation of the farmers by hiring a processing space from an established food processor in Tzaneen. Through this arrangement, Mufama managed to process and deliver 100 tons (9.8 containers) to German clients.

Against this background, Mufama identified a need to set up its own factory in Polokwane and received R13,6m funding from the IDC. The factory began production in March 2014 thereby creating 215 jobs, most of which are women, while sustaining 600 indirect jobs created by its grower farmers. The company has an export demand of more than 800 tons per season of this uniquely South African brand of peppers, which are exported across the globe.

With successes such as Mufama Bellegings, the IDC office in Limpopo is continually searching for projects in key sectors such as basic metals and mining as well as light manufacturing and tourism. “Mining, manufacturing and agro-processing are the main drivers in the province and we will continue to search for and support businesses in these key sectors and sub-sectors which are 100% youth-owned and have great potential to create jobs,” said Bapela.

Increasing the competitiveness of youth-owned enterprises is priority and through its Gro-E Youth Scheme, the IDC provides funding for youth-owned businesses in the sectors that the corporation funds, at an interest rate of up to prime minus 3%. A minimum of R1 million, with a maximum of R50 million per project, will be approved through the Gro-E Scheme and this reduced loan pricing will be available for five years. “We evaluate each application on its own merit and depending on the financial needs of the youth business, funding will be structured accordingly,” added Bapela.

During the 2015/16 financial period, the IDC approved close to R1 billion in youth transactions and hopes to significantly increase this amount. The corporation has set aside R4.5 billion for the funding of youth-empowered businesses over a period of five years. “We really encourage youth in Limpopo to take advantage of this funding. Contact our office and see how you can play a role in growing our province’s economy,” said Bapela.

Unlike other financial institutions, the IDC in Polokwane offers pre- and post-investment business support to ensure applicants are equipped to build sustainable businesses.

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Andries van Zyl

Andries joined the Zoutpansberger and Limpopo Mirror in April 1993 as a darkroom assistant. Within a couple of months he moved over to the production side of the newspaper and eventually doubled as a reporter. In 1995 he left the newspaper group and travelled overseas for a couple of months. In 1996, Andries rejoined the Zoutpansberger as a reporter. In August 2002, he was appointed as News Editor of the Zoutpansberger, a position he holds until today.

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