HOW IT ALL STARTED

The Business Trust and the Maruleng and Bushbuckridge Economic Development Initiative.
Between 2006 and 2011 the Business Trust ran a pilot project in Maruleng and Bushbuckridge where 500,000 people live on the border of the Kruger National Park. It aimed to pilot a market based approach to economic development. Part of the programme focused on working with communal property institutions responsible for the management of land acquired under the land reform programmes.

The Maruleng and Bushbuckridge Economic Development Initiative (MABEDI) provided three forms of support to communities: community facilitation, communal property institution -administration support and transaction advisory services in order to bridge the gap in knowledge and skills between communities and potential investors and to ensure that partnerships were fair and sustainable.

Partnerships were structured with investors for the development of their land and 16 of these partnerships raised R1,5 bn with the potential to benefit 3,300 families and create 4,975 jobs.

The success of those projects is attributed to the sustained and dedicated attention of skilled transaction advisors, community facilitators and property institution -administrators. Based on the success of the Maruleng and Bushbuckridge Economic Development Initiative pilot project, the Business Trust resolved to make a founding donation for the establishment of the Vumelana Advisory Fund.

How does Vumelana work?

1. Applications for funding are invited from communities, government departments, advisors or investors
2. A cooperation agreement is signed with the community setting out the basis of the relationship between the community and Vumelana
3. A transaction advisory team is contracted to structure an agreement in terms of which the community makes the land available and the investor undertakes to finance and manage operations
4. The Transaction advisory team procures proposals from potential partners which show how the land will be developed to create jobs, income, skills and other benefits for community members.
5. Once an agreement is signed, the investor reimburses Vumelana for the costs incurred by the transaction advisory team in putting the deal together.
6. The reimbursed funds are used by Vumelana to finance the support to the community property institution for a period of two years.