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Business News of Wednesday, 18 March 2015


IDC invests in hotels in Ghana and Uganda

The Industrial Development Corporation (IDC) has invested about R1.5bn in hotels in Ghana and Uganda.

The IDC said the construction of the hotels was part of its drive to create opportunities for local companies to export their goods and services into the rest of Africa. The corporation already has exposure of close to a $1bn in the rest of Africa.

"Those hotels are almost done," IDC CEO Geoffrey Qhena said. "The hotel in Ghana will be operated under Marriott and the one in Kampala under Hilton.

"Some of the goods and services that were used in these hotels come from SA and these are things such as furniture fittings and equipment."

Mr Qhena was a panellist at the Africa CEO Forum in Geneva. He and Mo Ibrahim, the founder of the Mo Ibrahim Foundation, were vocal at the forum about the importance of integrating African economies.

The IDC has about 60 projects in about 20 countries in diverse industries such as energy, infrastructure, agro-processing and services. Last year the company sold its 20% stake in Habesha Cement in Ethiopia to SA’s PPC.

The IDC had invested R74m alongside PPC in 2012, Mr Qhena told Business Day.

Following the sale of the IDC stake in Habesha Cement to PPC, Mr Qhena said his company did not have plans to exit other investments in the rest of Africa. Instead, in the short term the company planned to invest about R9m in some smaller projects on the continent.

"There are big projects that need to happen," Mr Qhena said. "We are keen on that."

One of the big projects was the Inga Hydro Energy project in the Democratic Republic of Congo. It presented an opportunity for a number of African countries to work together in generating power.

Mr Qhena said in an interview that without regional integration it was not easy for South African companies to move their goods and services in the rest of Africa. "What we want to do is put life into regional integration.... We have seen that South African companies have been exporting some goods to the rest of Africa."

He cautioned that if regional integration did not happen, Africa ran the risk of having to rely on European markets.

Mr Ibrahim called for the removal of customs red tape at the border posts of African states.