The National Empowerment Fund (NEF) had exceeded its Rlbn approval milestone
by the end of last month, five years after it became operational. It has been especially helpful to black entrepreneurs during the global economic crisis. The fund was established to provide investment funding to black empowered businesses and
investment opportunities for blackindividuals, and since its inception to the end of last month had approved 204 deals worth Rl,6bn and disbursed Rl,2bn. The R978m invested by end- March had created 15 866 jobs, CEO Philisiwe Buthelezi told Parliament's trade and industry portfolio committee on Friday.

She conceded that 61% of the funds invested by end-March were concentrated in Gauteng, but said the NEF planned to establish offices in the other provinces over the next three years. Partnerships would be formed with provincial governments to identify investment opportunities, preferably in companies in which blacks were
involved at management level. The economic crisis had speeded up investment activity because of the dramatic weakening in commercial bank credit extension. To help clients in distress, the NEF had engaged in debt restructuring programmes and hadprovided them with immediate cash flow relief and additional working capital. In the first six months of this year, more than R500m had been approved for 25 transactions. Buthelezi said the NEF was also encouraging banks to share the risk of funding.

The bad debt provision, however, had risen from 19% to 24%. The state had allocated investments in a range of state-owned enterprises to the NEF. Buthelezi said the shares in lottery operator Gidani had been transferred and talks were in progress for the transfer of shares in state forestry company Safcol, while other
priorities were the Airports Company SA and Telkom. The R890m discounted sale of 12- million MTN group shares received by the NEF from the state to 82 285 investors had contributed to the NEF's success. The MTN Asonge share price had appreciated 67% between 2007 and the end of last month, she said. Khula Enterprise Finance CEO Setlakalane Molepo told how the economic crisis and the strict implementation
of the National Credit Act had affected the approval and disbursement of funds. Approvals have fallen dramatically from R745m in 2007 to R605m last year and R315m this year.
ensorl@bdfm.co.za