THE ECDC REPORTS ITS FIFTH SUCCESSIVE UNQUALIFIED AUDIT OPINION

PRESS STATEMENT


Thursday, 10 December 2020: The ECDC is in a state of continuous improvement and it has for the last five years obtained an unqualified audit opinion from the Auditor-General. Since 2015/16, the Corporation has
witnessed a progressive improvement in its management of public assets with the focus being on maintaining the delicate balance between financial sustainability and the Corporation’s developmental mandate.

In this regard, the ECDC continues to engage the shareholder for the required capitalisation which is crucial for the
Corporation’s envisaged sustainability and viability. In the 2019/20 financial year the ECDC broadened its focus from the implementation of social infrastructure
to include economic infrastructure projects.

During the period under review, the ECDC completed the R8.3 million refurbishment of its factory in Butterworth as well as the implementation of the first phase R50 million Dimbaza Industrial Park security upgrades. With the introduction of the Eastern Cape Provincial Economic Stimulus Fund (PESF), three of the nine economic infrastructure projects which had been planned in the previous financial years received funding for further implementation from the PESF.

A total of R 36.7 million was secured for the second phase Dimbaza Industrial Park Roads and Services project, Queendustria
electrification and the Mount Ayliff informal trader Infrastructure projects The ECDC continues to demonstrate its efficacy in acting as a stimulant for improved and robust economic activity for the SMMEs. Although facing significant liquidity constraints, the ECDC took a decision to spread its development debt finance tools to reach a limited section of the SMME market.

This had the effect of reducing the Corporation’s ability to approve high value loans, allowing the ECDC to approve and disburse small loans enabling the Corporation to service a larger portion of qualifying and deserving small businesses.
In 2019/20 the ECDC disbursed R58,7 million worth of loans to 216 SMMEs, a significant increase from the 163 and 190 SMMEs supported in 2017/18 and 2018/19 respectively. As the ECDC works towards putting women and youth at the forefront of the economic development in the province, the loan disbursement figure facilitated the creation of 809 jobs where 372 were youth and 310 were women.

Women owned enterprises accounted for R7,16 million of the disbursements and youth-owned businesses received a share of R12,73 million.

The Eastern Cape Jobs Stimulus Fund disbursements of R9,8 million to 16 businesses resulted in 980 jobs being saved in the 2019/20 review period. The Jobs Stimulus Fund helps sustain distressed business with resultant retention of jobs.

While the Imvaba Co-operative Fund which provides grant funding through an incentive and institutional building support to co operatives disbursed R9,3 million to 20 co-operatives in 2019/20. This grant funding support brings co-operatives into the mainstream economy and it enhances self-
employment creation opportunities in the province in this segment of the economy. The co-operatives propel the rural and township economy. The geographical spread of the loan disbursements is consistent with the economic realities of the districts of the province.

However, the Corporation is pleased with the improved disbursements in areas such as Alfred Nzo. The Nelson Mandela Bay metro accounted for R20,4 million of the disbursements, Amathole R12,8 million, OR Tambo R11,3 million, Chris Hani R10,1 million, Alfred Nzo R3,7 million, Joe Gqabi R257 434 and R4,491 went to the Sarah Baartman district. Speaking to the trade, investment and innovation programmes of the ECDC, Chief Executive Ndzondelelo
Dlulane says “the aim of these programmes is to ensure that local businesses have a competitive edge and the technical acumen to compete with their global counterparts”, further saying that “the finalisation of the
African Free Trade Zone opens an exciting chapter for the continent and the Eastern Cape in particular. This free trade agreement opens immense opportunities for Eastern Cape companies to extend their reach into Africa without the hindrance of regulatory barriers and to foster business partnerships with their counterparts
in the rest of the continent in finding lasting solutions.”The Corporation is pleased that it managed to secure investment revenue worth R1,1 billion for the Eastern Cape in 2019/20.

A total of 211 SMMEs benefitted from integrated export support. Furthermore, a total of 223 people received critical skills training. A total of 12 development projects were facilitated. In its quest to attract investment revenue through film projects, the ECDC was able to secure and approve seven feature film projects in the province with an investment revenue of R114 million. The Corporation continues its long-standing commitment to the development of a buoyant and innovative creative industries sector in the Eastern Cape. Beyond training and development activities, the ECDC plays a crucial market access role for Eastern Cape creative. As such, the Corporation identifies various market opportunities which are aimed at increasing the sales of local craft entrepreneurs. The ECDC provides numerous sector-specific support packages which are aimed at growing and sustaining the vibrant creative sector in the province. As such The Eastern Cape Craft Collection Shop now located in the Beacon Bay Crossing in East London supported 127 craft producing entrepreneurs who are mainly drawn from rural areas.

Total sales from December 2019 to February 2020 amounted to R262 000. This craft shop is an excellent platform for craft producers to sell their craft. ECDC is also increasing its footprint in the Middle East region.

There exists a potentially lucrative market for Eastern Cape agricultural produce in this region. In 2019/20, the ECDC met fresh produce hyper market groups in the United Arab Emirates (UAE) on the invitation of these groups. These hyper market groups view South African products as being of a high quality. The discussions were centred on opportunities of exporting fresh produce from the Eastern Cape to the Middle East. The Corporation met the three largest hyper market groups in the UAE – Lulu Market, Farzana Trading and Grand Hyper.


Faced with limited financial resources the ECDC continues to strengthen collaborations, partnerships and
strategic alliances for leveraging in order to augment resources to further its development mandate. The success thereof is depicted in its property portfolio which the ECDC is rehabilitating working with other partners for better economic impact.
Dlulane adds “In the hierarchy of good governance, the next step for the ECDC is to obtain a “clean audit” outcome.

This outcome is characterised by an unqualified opinion with no emphasis of matter items on the financial statements, an unqualified opinion on performance objectives and by having no findings on
compliance matters. The attainment of a clean audit outcome is possible through the application of consistent controls and good governance practices throughout the year. This consistency in application should ensure that the ECDC complies with all applicable policies, laws and regulations.”
Issued by the Eastern Cape Development Corporation.


For further enquiries contact:
Nobulali Myataza
ECDC Spokesperson
Email: nmyataza@ecdc.co.za
Tel: 043 704 5610
Cell: 064 850 8655

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