Strategic Projects Fund
SPF's sector focus is informed by the government's strategies on industrial development through the dti's National Industrial Policy Framework, the corresponding Industrial Policy Action Plans [IPAP] as well as the current government economic growth strategy, the New Growth Path. The sectors identified based on the IPAP and the New Growth Path and are listed as follows:
- Agriculture;
- Business Process Outsourcing [Call centres, data storage centres and termination centres];
- Textiles
- Mining, Mineral Processing and Mineral Beneficiation;
- Automobiles
- Renewable Energy and Biofuels [solar, biomass, hydro, co-gen and wind];
- Plastics;
- Pharmaceuticals and Chemicals
- Forestry, Pulp and Paper;
- Infrastructure [telcoms, healthcare, roads, rail airports, dams and water];
- Manufacturing;
- Tourism [hotels, resorts, tourism attractions and leisure];
The list above is a guideline, and SPF will evaluate each project based on its economic merit and ability to deliver on the Development Mandate.
Established in 2008 as a division within the NEF, the SPF’s mandate is to play a central role in early stage projects by identifying, initiating, scoping and developing projects that are in sectors identified by government as key drivers to South Africa’s economic growth. These projects will be taken through 6-stages of project development.
The phases being the following: Scoping and Concept Study; Pre-Feasibility Study; Bankable Feasibility Study; Financial Closure; Construction Phase; and Technical Completion.
Through the Strategic Projects Fund, NEF will facilitate BB-BEE in the following ways:
- Warehouse equity for BB-BEE in early stage projects at valuations with little or no premium paid to access the projects. This enables NEF to distribute its warehoused equity to BB-BEE at lower valuations once a project is operational;
- Take early stage risk on behalf of black people as early stage projects have higher execution risks compared to operational companies. The NEF will assume most of the financing risk and devise instruments to carry or transfer equity to BB-BEE once project fatal flaws have been mitigated;
- Manage the project and venture capital finance structuring complexities as it is more complex and difficult to raise capital for new ventures as compared to corporate finance deals where valuations can be ascertained based on historical performance and risks are clearly understood;
- Enable project promoters to focus on making projects bankable and operational by giving the BB-BEE status as NEF is the only DFI gazetted as a BB-BEE facilitator.
For more information visit: www.nefcorp.co.zaSource: www.nefcorp.co.za
National Empowerment Fund (Owner)
