Samdef: The next decade The Southern African Media Development Fund (Samdef), the media development arm of MISA, celebrated its 10th anniversary during 2008. It provides an ideal opportunity to take stock of the achievements made and the challenges learnt during the past decade. Importantly, the original objectives for which Samdef was established in 1998 still hold true: to offer financial products and services to media entrepreneurs in southern Africa, with a specific focus on emergent and independent, private media. Access to funding by media organisations, especially those that are small and emerging, remains a major stumbling block. Mainstream financial institutions, including commercial banks, are generally averse to funding media houses. Only in exceptional cases, where there has been proof of healthy cash flows, have banks provided short-term funding, albeit at high interest rates and collateral security of more than 100 per cent. In some instances, we have witnessed promoters desperately trying to finance their long-term capital expenditure with short-term funding instruments, such as overdrafts. Over the last few years, there has been an unprecedented, exponential demand for funding and enquiries from potential media promoters as governments in the region liberalise the airwaves and media houses prepare to go digital. Information and communication technologies (ICTs) and new media technologies have changed the face of the media as we knew it, placing greater need on keeping abreast of technology. As a funding institution, Samdef faces the challenge of satisfying this ever-growing demand and contributing to its mandate of prompting media development to build capacities and strengthen democracies. New initiatives In August 2008, the MISA Trust Fund Board approved Samdef’s strategy to develop innovative and diversified financing models for the development of sustainable media enterprises in southern Africa. Under this new strategy, Samdef will finance media technology, broadband roll-out, mobile media telephony and content development. Samdef will also initiate and strengthen specific strategic partnerships with other institutions that work in the development of media, technology transfers and development finance institutions. In its unrelenting effort to add value to medium-to-large media enterprises, Samdef entered into a joint venture agreement with Stargate Capital Management Ltd, a fund manager from the United Kingdom, to set-up a private equity fund to finance media and technology in southern Africa. The importance of private equity funds in propelling development is evident in the growth of these funds in Africa. The private equity fund, which aims to raise around US$100 million, is expected to start operating in the first quarter of 2010. Samdef loan portfolio The Samdef investment portfolio recorded a 13 per cent growth of P6.5 million to P57 million (US$7.8 million) before impairment provisions. The net growth was P6.9 million, or 23 per cent, to P35.6 million (US$5.5 million). Against the background of a very challenging economic environment punctuated by the global financial crises, the following investments totalling P1.6 million were financed during the year: · · 40 completion of a printing press in Mozambique – S-Graphics; completion of the transmitter infrastructure project for two radio stations in Botswana – Yarona FM and Gabz FM; Annual Report 2009