By Special Correspondent:
The National African Federated Chamber of Commerce and Industry (NAFCOC) has turned to Parliament, demanding that the Industrial Development Corporation (IDC) be held accountable for what it calls a failure to deliver on its developmental mandate and for discriminating against black-owned businesses.
In a strongly worded letter to National Assembly Speaker Thoko Didiza, NAFCOC accused the state-owned financier of consistently sidelining township enterprises and black industrialists, while channelling funds to white-owned and privileged companies. The chamber said black businesses are routinely bogged down in red tape when seeking support, undermining efforts to drive inclusive economic growth.
Parliament has agreed to meet with NAFCOC following the complaint. Didiza has referred the matter to the portfolio committee on trade industry competition, which will now consider the chamber’s grievances against the IDC. during a virtual meeting with NAFCOC leadership on 24 February.
This behaviour is inconsistent with the spirit of transformation and IDC’s own mission
In its statement, the black business chamber accused the Industrial Development Corporation (IDC) of entrenching systemic barriers that have long stifled black enterprise. It said black-owned firms continue to face inconsistent funding practices and inadequate post-investment support, while established and white-dominated companies benefit disproportionately from IDC financing.
“We are witnessing a troubling trend where black entrepreneurs face endless red tape, only to see their projects deliberately delayed, collapsed, or arrogantly auctioned at ridiculous prices — often without proper explanation. This behaviour is inconsistent with the spirit of transformation and with the IDC’s own mission to promote equitable industrial development and implementation of the Black industrialists programme,” said NAFCOC Secretary-General, Richard Zulu.
IDC’s own financial disclosures reveal recurring governance weaknesses, including hundreds of millions of rand in impaired loans annually, poor oversight in project approvals, and ineffective post-investment monitoring.
Zulu noted the fact that although the Auditor-General continues to issue unqualified opinions, material losses and impairments persist, casting doubt on the IDC’s internal controls and accountability.
“When a state-owned development financier repeatedly records massive impairments without visible reform, it raises serious questions about leadership accountability and institutional intent. “Investigations by law-enforcement agencies and the media — including City Press, Sunday World, and Mail & Guardian— have revealed IDC-funded projects that collapsed or were written off, sometimes amid allegations of favouritism, poor due diligence, or internal misconduct or alleged collusions.
Onerous compliance hurdles, protracted approval timelines, and limited aftercare for emergent entrepreneurs
These incidents suggest weak risk management and selective support, undermining the very entrepreneurs the IDC was created to empower but becoming known as “a slaughterhouse of black business initiatives,” Zulu said.
Despite the country’s transformation imperatives, IDC data shows a continuing underrepresentation of black-owned, youth-owned, and township enterprises in its loan portfolio. It has no faith in black South African business. Emerging entrepreneurs frequently report onerous compliance hurdles, protracted approval timelines, and limited aftercare, while larger, established firms receive faster and more generous support and continuous bailouts. “This imbalance is structural and economic — it undermines the goal of inclusive industrialisation and perpetuates inequality in access to finance,” noted Zulu.
Although the IDC’s Conflict of Interest Register (May 2025) declares no active conflicts, past parliamentary debates and investigations have raised concerns about undisclosed relationships between IDC officials and certain and selected beneficiaries.
A black initiative has been systematically frustrated with shifting goalposts
The absence of full public disclosure of related-party transactions continues to erode confidence in the IDC’s fairness and transparency.
A particularly concerning example involves the Gelvenor Africa Project — a strategic textile-manufacturing initiative in which NAFCOC, through its investment arm Silver Vanity Investments (SVI), holds a significant stake. SVI is a 100% broad based black-owned enterprise whose benefits extend to more than 2.3 million NAFCOC members and affiliates nationwide. Despite IDC’s formal approval of support, the project has been systematically frustrated by delays, inconsistent conditions, failure to provide technical and human support and shifting requirements.
Zulu said key concerns include; prolonged delays in releasing approved working capital since 2021, causing severe operational strain; failure to appoint IDC-nominated experts directors as required by the loan agreement; reliance on unverified reports and external influences that appear to have shaped IDC’s stance; inconsistent interpretation of own clauses such as reserve-fund requirements, adding unnecessary pressure on SVI to provide more than 60% surety or guarantees; and the sudden introduction of new conditions, including a demand for an additional R48 million equity partner — contrary to the IDC’s developmental-finance mandate or it becoming that equity partner for a while.
“Gelvenor Africa was conceived to showcase black industrial capability, yet it has been hindered by red tape and inconsistent decisions that now threaten its viability and continuation. Such treatment of a 100% broad based black-owned project is unacceptable and reflects deeper institutional shortcomings within the IDC,” he said.
Companies with potential allegedly being subjected to forced liquidation that being rescued
To the surprise of NAFCOC and fellow black businesses as a whole, IDC has opted for litigation and force liquidation route rather than to save the company with potential job creation of approximately a thousand direct and over ten thousand indirect jobs through NAFCOC’s multiple sectoral approaches.
NAFCOC calls for a comprehensive, independent forensic review of the IDC’s operations and funding practices over the past decade, focusing on Disbursement patterns by race, sector, and geography; loan-approval timelines and rejection rates; recovery and resale processes for failed black-owned enterprises; and potential conflicts of interest or irregularities in project disposals and alleged corrupt or javelin practices.
The organisation also urges the Auditor-General of South Africa and Parliament’s Portfolio Committees on Trade, Industry and Competition, and Public Enterprises to prioritise oversight of these mat
Chamber rejects bureaucracy or selective empowerment but demands commitment to transformation
“Our demand is straightforward — transparency, accountability, and fairness. NAFCOC does not make unproven allegations, but we will not remain silent while black industrialists and MSMEs are marginalised by the very institutions established to empower them.
“Rebuilding trust between government, development finance institutions, and black entrepreneurs is vital. That trust must be grounded in mutual respect, consistent practice, and an unambiguous commitment to genuine transformation — not bureaucracy or selective empowerment,” emphasised Zulu.
NAFCOC calls upon the top echelon of IDC to hold an urgent meeting and reprimand the lower and some middle managers who are allegedly the cause of what is widely known as ÏDC acts as a slaughterhouse for any black business initiatives or projects getting into its systems. -@NewsSA_Online
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