Industrial Development Corporation (IDC) of South Africa has declared Zimbabwe a good investment destination as evidenced by the strong economic recovery.
The corporation said it would continue to bankroll projects in the productive sectors of the economy.
Speaking on the sidelines of the signing ceremony for the $30 million line of credit for Agribank on Friday, IDC executive director Ufikile Khumalo said the country’s economy was on the upswing.
“Zimbabwe’s economy is on a growth path. The last two years has seen the country post impressive growth rates,” said Khumalo.
“We are bullish about the way Zimbabwe economy has grown recently.” The country’s economy rebounded from decade-long decline to register successive growths of 5,7% and 8% in 2009 and last year respectively.
Khumalo said IDC was lining up new lines of credit for companies in the gold mining and telecommunications sectors.
“We are in the process of finalising additional funding for various companies. There are just a few issues we have to get out of the way,” said Khumalo.
IDC last week extended a $30 million credit line to Agribank to fund the company’s recapitalisation needs.
Khumalo said the line of credit was part of IDC’s efforts to assist in the recovery of the economy. “Capacity building initiatives have already started and hopefully the funds will be used in a professional manner,” he added.
The company has already extended $80 million to other institutions in the country including Delta Beverages and Econet Wireless.
Finance minister Tendai Biti said the line of credit was one of the fruits the country was reaping since signing a Bilateral Investment Promotion and Protection Agreement (Bippa) with SA two years ago.
“IDC’s credit is a signal of Bippa in action,” said Biti.
According IDC financial results for the year ended March 31 2010 the company approved funding amounting to R9,4 billion.
IDC is a self-financing, South African state-owned national development finance institution that provides finance to promote industrial and entrepreneurial development.
The IDC identifies and funds projects in partnership with others and focuses on promoting and investing in viable new industries.
It differentiates itself through risk taking and flexibility in structuring, particularly in promotion of broad-based black economic empowerment, SMEs, regional investment diversification and job creation.