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USAID West Africa Trade Hub
Roger Brou Business & Finance Director
March 2013
West Africa Trade Hub In 21 countries, with UEMOA, ECOWAS, & CEMAC
•+/-300 million inhabitants •GDP est. $500 billion USD
Offices in Accra, Dakar, & Arlington; Virtual team in Ouaga, Abuja, & 18 ARCs
Value Chain Approach Informs Trade Policy & Infrastructure Improvements
People, Planet and Profit: The triple bottom line – a market driven approach to development
The Problem In West Africa, 75% of the population live on
less than US$2 per day.
The Question IS: How to create jobs and lift incomes in a
sustainable fashion?
• Traditional crop • Millions rural
women • Weeks of work • April to September • Kernel quality
defined • Price takers • Commence selling
@ < $150 per ton kernel
• 1,000s of nut traders
• Consolidate & finance
• Commence selling @ > $250 per ton kernel
• Quality deteriorates • Limited value added
• < 10 major buyers • Export, process &
formulate • Erratic price @ $250 -
$800 per ton kernel • Quality variation high • Zero traceability
Production to Market
DISCONNECTED… Limited
transparency!
The Global Shea Alliance annual conference connects an industry, leveraging resources to drive business opportunities
Shea 2013 GSA conference offers training and opportunity on: •Access to Finance •Transportation •Cosmetic formulation •Packaging Business to Business Conference and presentations Exhibition Field trips
Partnering with international financial institutions, regional banks and investors to improve lending and investing opportunities for exporters. Product & Process Development: Innovative approaches to trade finance for commercial banks. Promoting Best Practices and Training: Bringing banks and companies together to develop relationships that are mutually beneficial. Hosting annual Financing Trade Regional Conference. Technical Assistance: Helping bankers develop products/processes. Facilitating exporters to apply for loans, develop financial projections and business plans.
Exporters’ #1 Hurdle: Access to Competitive Financing
Increased Jobs and Wealth Creation
10
Based on Value Chain approach the Trade Hub:
Facilitates dialogue with regulatory authorities Leverages partnerships:
Commercial Banks Multi- and Bi-lateral Institutions Investors Buyers
Provides industry-specific financial training Assists with company-specific technical needs
Financial Services Approach
ERC
Trade Hub
Commercial Banks
Investors
LCs, Purchase Orders
New products & services
Government & Multi-lateral Institutions
Performance-based Financial Service Providers Business Plans Investment
Promotion Financial Structuring Negotiations Management
Coaching Product costing and
Pricing
MSMEs Type of Financial Needs
Short-Term (1 year max) – Procurement financing – Working Capital Financing – Trade Financing/ Term loan
Medium to Long-Term (more than 1 year) – CAPEX financing for expansion, acquisition of
new equipment (leasing or direct purchase) or new factory construction
Long Term Financing EBID-USAID-ACA MoU BOAD-USAID-ACA MoU Private Equity Funds for medium/ long-term Strategic partnership (JV, M&A, etc)
MSMEs Sources of Financing 1. Equity Financing 2. Debt Financing 3. Trade Financing 4. Government/ NGOs grants
Equity Finance Sources Triodos Octave Company Nova Capital Phoenix Capital
Debt and Trade Finance Sources MFIs Commercial banks Social Impact Investment Funds
– Root Capital www.rootcapital.org – Grassroot Business Funds www.gbfund.org – Acumen Funds www.acumenfund.org – ResponsAbility Funds www.responsAbility.com
Find out more
www.watradehub.com
www.globalshea.com
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