South Africa’s Industrial Development Corporation (IDC) is preparing a R51.5 billion ($3.15 billion) funding programme aimed at supporting industries considered vital to the country’s economic recovery, including manufacturing, energy, mining and infrastructure.

The state-owned development financier said the three-year plan comes as South Africa works to rebuild industrial capacity, attract investment and support companies facing rising production costs, global competition and supply chain disruptions.

The funding strategy has been aligned with the government’s Industrial Development Strategy (IDS) for 2026, which places greater focus on sectors such as critical minerals, green industries, digital services and advanced manufacturing.

Acting IDC Chief Operating Officer David Jarvis told Parliament’s Select Committee on Economic Development and Trade that the organisation would continue supporting established businesses while investing in emerging industries expected to create new economic opportunities.

IDC prioritises manufacturing, energy and critical industries

The IDC’s corporate plan outlines disbursements of R16.3 billion($997.45 million) in the 2026/27 financial year, R17.4 billion($1.06 billion) in 2027/28 and R17.8 billion($1.09 billion) in 2028/29.

The organisation expects most of the funding to come from internally generated cash, with limited reliance on additional borrowing.

Manufacturing is expected to receive the largest allocation at R17.4 billion($1.06 billion), followed by energy and infrastructure with R11.7 billion($715.95 million), mining and metals with R5.8 billion($354.93 million), agro-processing at R4.5 billion($275.37 million) and tourism and services at R2 billion($122.4 million).

The IDC said it would also support regional industrial projects but would participate mainly through partnerships and minority ownership positions.

Government looks to protect manufacturing jobs

The industrial strategy comes as South Africa’s manufacturing sector faces pressure from high operating costs, import competition and infrastructure challenges.

Manufacturing’s contribution to gross domestic product has declined to about 13% from 21% in 1994, raising concerns about the sector’s ability to create jobs and support economic growth.

The Department of Trade, Industry and Competition has proposed measures including special electricity pricing arrangements, increased import protection and tax incentives to help industries such as steel, automotive manufacturing and smelting remain competitive.

The department has also suggested that the IDC could be exempted from corporate income tax to allow it to increase its support for industrial development projects.

IDC Strengthens Role in Strategic Assets

The Industrial Development Corporation was established in 1940 as a South African state-owned development finance institution focused on funding businesses and projects that support industrial growth, job creation and economic development.

It provides financing across sectors including manufacturing, mining, agriculture, energy and infrastructure.

The IDC is also involved in discussions around strategic companies such as ArcelorMittal South Africa (AMSA), which is currently in talks with the corporation over a possible transaction. The IDC did not provide details about the discussions in its parliamentary presentation.

The organisation said its fertiliser subsidiary, Foskor, had recently faced renewed financial pressure due to higher costs for key inputs, including sulphur and ammonia, following disruptions affecting global shipping routes.

The company said it would continue implementing measures to strengthen operations while responding to challenges affecting its financial performance.