Centre for the Development of Enterprise: Business Development Services for the ACP Private Sector 1
CDE – Centre for the Development of Enterprise � An insti- tution of the ACP Group and the EU – under Cotonou Agreement � Supports the sustainable development of the ACP private sector � Financed by the European Development Fund (EDF) 23/ 09/ 2009 CDE - the institution 2
3 CDE in brief
The CDE: key figures � Total number of interventions undertaken= 1 5 .7 3 8 � Total number requests received= ± 2 1 .5 0 0 � Total number entreprises assisted = ± 1 1 .6 0 0 � Total number of jobs created= ± 1 5 .0 0 0 � New investments generated or linked to CDE interventions = € 2 .3 1 0 m illions � Professional meetings, thematic workshops organized by or linked to CDE = 5 1 7 � Number of ACP participants= ± 8 .9 0 0 � Number of European participants= ± 2 .9 6 0 4
Achievements over the last 10 years 4,000 ACP enterprises have been assisted by CDE through some 6,500 interventions � � Geographical distribution Sectoral distribution West Africa Agro-Industry Central Africa Construction, Wood, Metal Eastern Africa Leather and Textile Southern Africa Tourism and Services Caribbean Others Pacific 9% 18% 25% 15% 40% 9% 12% 19% 8% 20% 25% CDE Achievements 5
Eligible Beneficiaries � Private Sector enterprises • Enterprises in the creation, extension, diversification or reorganization phase in the ACP countries • Enterprises must have promising prospects for financial and economic viability as well as a positive development impact � Private Sector Intermediary Organizations • Professional associations, federations, technical centres, investment promotion bodies, etc � Service Providers • ACP consultants and consulting firms Beneficiaries and approaches 6
The CDE intervenes… � Through Programmes � Increasingly, CDE interventions are being undertaken within the framework of Programmes (2/3 of the budget) � Cluster approach – grouped assistance � Through Ad Hoc Assistance � In response to individual requests and prospective investors Priority sectors: � manufacturing � agro-industry and commercial farming � fisheries � forestry � mining and construction � Tourism � Trade � transport and other related services 7
� Key eligibility criteria • Private sector SMEs legally established in an ACP country • Net assets of at least 80.000 € • Maximum net assets : 10 m € • At least five employees • If new enterprise : same amounts of investments, turnover and jobs forecast • Commitment to contribute at least one-third of the expenditures eligible for assistance • Compliance with international codes of good conduct (working conditions and environmental impact) 8
9 CDE Support during…
Rationale of Program m e approach • Purpose : � Identify and select sectors and activities with highest potential for social and economic development in ACP countries Benefits: • � Better knowledge of selected sectors and transversal activities � Lower average cost per intervention, hence more SMEs can be assisted � Improved ability to promote inter-enterprise partnerships � Better complementarity and coherence with the priorities of other development actors � Prompt and effective response to requests for assistance � Higher efficiency by grouped assistance � More visibility of CDE-Pro€Invest actors in the field 10
Example of CDE programmes Sector Programmes Cross-cutting Programmes Sustainable Forestry & Competitiveness Timber Processing Enhancement Maintenance in the Promotion of Aquaculture Infrastructure Sector ICT – Information and Cotton & textile Communication Technologies 11
Sustainable Forest Managem ent SFM and Dow nstream Processing Context • SFM is based on environmentally, socially beneficial and economically viable management of forests for present and future generations • The world market for timber and wood products is more and more geared towards certified products from SFM • Target countries have significant sustainable forest resources Global Objective • Develop Sustainable Forest Management (SFM), downstream processing and export Specific Objectives • Increase Sustainable Forest Management • Increase production and marketing of timber from SFM, including promotion of certification • Improve productivity and downstream processing of value-added products • Promote regional trade and cooperation; increase export capacity S ector Programmes Wood Sector
Continental Aquaculture Context The fisheries of the African continent provide vital contributions to the nutrition and food of 200 million people, and involve 10 million persons Global Objective Increase the industrial and semi- industrial fish farming production of the continental African countries. Specific Objectives • Increase fish farming production by private companies • Increase and improve fish food processing • Create a national and regional network of aquaculture expertise • Promote local, regional and international trade S ector Programmes Fish Sector
Subcontracting and Maintenance in the I nfrastructure Sector Context • Roads are essential for economic development • Lack of maintenance has high cost • Transfer of road building and management to private agencies • Need of capacity-building to SME contractors Global Objective Contribute to the improvement and maintenance of the African road network through involvement of SMEs Specific Objectives • Increase capacity of SMEs specialised in road building and maintenance • Promote sub-contracting and partnership with EU companies • Support professional organisations • Develop capacity of engineering firms S ector Programmes Infrastructure Sector: maintenance
COOPERATI ON W I TH DEVELOPMENT FI NANCE I NSTI TUTI ONS ( DFI s) • Regular working relationships with relevant DFIs to seek complementarity and to achieve maximum impact with pre- investment assistance, i.e. to mobilise investment funding. • CDE’s technical or management assistance for project implementation and initial operating phase is a useful complement to DFI financing. • PRACTI CAL EFFECTS CDE as interface between promoters and DFIs: � facilitates access to relevant finance sources � helps to reduce evaluation cost of DFIs � provides management and technical assistance to projects financed 15
CDE and Venture Capital Funds (VCFs) • Early involvement in the “pioneer phase” of VCFs in Africa; • Recognition of equity finance gap typical for SMEs (limited scope for FDI and joint ventures, structural lack of local private equity, unacceptable debt-equity ratios); • Need for institutional equity combined with enterprise support services; • VCF managers in Africa must often provide “extended functions” : � contribute to business plans and investment studies; � assist with technical and market assessment; � help locate technical and management expertise; � assist in obtaining additional finance; � advise/ monitor ongoing investee companies; � assist for appropriate accounting and reporting systems. 23/ 09/ 2009 16
17 CDE’s ASSISTANCE TO Venture Capital 23/ 09/ 2009 Funds
Agreem ents concluded w ith VCFs • The initial agreements signed in January 2008 with I &P –which invests particularly in West and Central Africa– and DEVCAP in the Caribbean, were followed by those concluded at the end of 2008 for four African regions as well as for the Pacific: � Southern Credit Corporation in Kenya , for East Africa, � I ndustrial Credit Cooperation ( I CC) in Zambia, for Southern Africa (SADC), � Cauris in Togo , for West African UEMOA countries, � Makeda Fund in Nigeria , for West African ECOWAS countries, � Kula Fund in Mauritius , dealing with the Pacific area. 23/ 09/ 2009 18
Private Sector Development Programmes (PSDP) • W HAT? Exam ples in Sub- • PSDP, funded either by ACP Saharan Africa: countries’ own resources, by European Development Fund � Democratic Republic (EDF) resources, or by other of Congo (Belgian donors, have sectoral and trust fund) – EDF thematic priorities set by a national funding under national or regional negotiations committee which includes representatives of both � Republic of Gabon – public and private sectors. Gabon own budget • Tailor-made formulation and � Côte d’Ivoire – own Public-Private dialogue budget • CDE as executing agency � UEMOA – aid for trade budget • Focus on enterprise level 23/ 09/ 2009 19
RESOURCES � Human Resources: • At Headquarters • In ACP countries • In Europe � Financial Resources • European Development Fund (EDF) • Third parties • Other programmes 23/ 09/ 2009 CDE Resources 20
Human Resources � At Headquarters in Brussels: 2 departments • Operations Management : technical & sector expertise • Administration � In the ACP regions • RFO : Regional Field Offices in each ACP region • National antennae • Specialized correspondents (sector and financial specialists) � In Europe • Operational correspondents in the institutions of the EU Network • Mobilization of EU Enterprises and Intermediary Organizations 23/ 09/ 2009 CDE Resources 21
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