Business - Zambia's President Michael Sata has announced the establishment of the Industrial Development Corporation (IDC) that will serve as the holding firm for all state-owned enterprises incorporated under the Companies Act or the Banking and Financial Services Act. The holding company, which is 100 per cent government-owned, has an initial authorised capital of K20 million (US$3.59 million), out of which the President disclosed that K10 million (US$1.79 million) has already been paid up using funds from the Privatisation Revenue Account.
“I will soon be appointing the Board Members of the IDC. I have also directed that a Sovereign Fund, which will initially be supported by the IDC after Parliament passes a statute to give effect to the Sovereign Fund, be constituted with due dispatch.
'I have further guided that 75% of the dividends from the IDC itself and its subsidiaries be paid into the Sovereign Fund,” President Sata said in a statement posted on his facebook page.
Sata, who has defended government’s position to establish the IDC, said it would be a tool for the modernisation and diversification of the economy in order to create jobs, wealth and prosperity for the Zambian people.
He said the state would, through the IDC, maximise the value of government assets by establishing a sovereign wealth fund which will focus on stimulating investment in strategic non-mining industries, among others, thereby expanding the country’s investment portfolio and thus creating jobs.
The IDC is also expected to boost the contribution of State-Owned Enterprises (SOEs) to national development by placing them under one umbrella holding entity to deepen their reform, enhance efficiency and maximize returns.