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Linking IDC finance to structural transformation and inclusivity in post-apartheid South Africa

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  • Sumayya Goga
  • Teboho Bosiu
  • Jason Bell

Abstract

The need for structural transformation and inclusivity in South Africa is urgent, given poor economic growth, employment and equality outcomes. This article examines the role of South Africa’s main industrial finance institution – the Industrial Development Corporation (IDC) – in providing finance for structural transformation and inclusive economic growth post-apartheid. We find that the IDC’s funding has been concentrated in capital-intensive upstream sectors of the economy, with limited concessional finance to facilitate meaningful entry of SMEs into high-value and labour-absorptive downstream sectors. The IDC’s funding model (in being a self-sustainable institution) is a significant constraining factor in this regard. Furthermore, the lack of a purposeful integrated industrial policy strategy which directs investments clearly means that IDC’s funding priorities are not clearly defined.

Suggested Citation

  • Sumayya Goga & Teboho Bosiu & Jason Bell, 2019. "Linking IDC finance to structural transformation and inclusivity in post-apartheid South Africa," Development Southern Africa, Taylor & Francis Journals, vol. 36(6), pages 821-838, November.
    • Handle: RePEc:taf:deveza:v:36:y:2019:i:6:p:821-838
    DOI: 10.1080/0376835X.2019.1696181
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    Cited by:

    1. Diogo Ferraz & Fernanda P. S. Falguera & Enzo B. Mariano & Dominik Hartmann, 2021. "Linking Economic Complexity, Diversification, and Industrial Policy with Sustainable Development: A Structured Literature Review," Sustainability, MDPI, vol. 13(3), pages 1-29, January.

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