Source: Government establishes fund to support critical industries growth – herald
Martin Kadzere, Zimpapers Business Hub
The Government has established an Industrial Development Fund (IDF) with an initial outlay of ZiG100 million to support high-growth value chains in the manufacturing sector, a Cabinet minister has said.
The fund is designed to provide “patient capital” to strategic industries, driving value addition, import substitution, and job creation, said Minister of Industry and Commerce, Mangaliso Ndlovu.
The new fund will be administered by the National Venture Capital Company of Zimbabwe (NVCCZ) to ensure effective management. This new arrangement follows a Memorandum of Understanding (MOU) signed between the Ministry of Industry and Commerce and the Ministry of Finance, Economic Development and Investment Promotion to ensure that Treasury allocations will go directly to support high-value chains within the manufacturing sector.
“We are happy that the Treasury has committed to consistently support the fund to aid high-growth value chains within the manufacturing sector until it is self-sustaining,” said Minister Ndlovu in an interview.
“It is a privately focused fund to support critical sectors, providing them with the financial and technical support needed for them to grow.”
Minister Ndlovu said the decision to create the IDF was prompted by the fact that the Industrial Development Corporation (IDC), which used to perform a similar role, is now under the control of the Mutapa Investment Fund.
Both ministries agreed that a dedicated fund, managed directly, would be the most effective way to channel resources into selected industries of national importance.
He said the fund’s core objective was to provide crucial financial support to strategic sectors like manufacturing and agro-processing, helping to build stronger local value chains. The initiative is a direct response to the Government’s push for increased local production and reduced reliance on imports.
The Government, taking advantage of the strong links between its manufacturing and agricultural sectors, is placing a special emphasis on developing key value chains. A special focus is being placed on “low-hanging fruit” for a structurally transforming economy. These include the fertiliser, soya, cotton, dairy, sugar, leather, pharmaceutical, bus and truck, engineering iron and steel, and plastic waste value chains.
NVCCZ chief executive Tino Kambasha said in an interview the newly established IDF would support key areas within high-growth manufacturing value chains. He said the fund would prioritise “high-impact projects” that align with the national agenda.
To ensure effective management and prevent misuse, Mr Kambasha said the fund would conduct thorough due diligence on all projects. He added that resources will be deployed on a “drip-feeding basis” rather than as a lump sum. This staged disbursement was intended to ensure that funds are used for their intended purpose and prevent money from being spent on non-essential items.
Mr Kambasha expressed his belief that the fund’s proper management will attract further investment from external partners, such as pension funds and development partners like the African Development Bank. He also shared his vision for the future, suggesting that different specific funds for other sectors, such as mining, could be established under the National Venture Fund to create a diverse portfolio.
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