Strengthening the capabilities of clients companies

STRENGTHENING THE CAPABILITIES OF CLIENTS' COMPANIES

PROVIDING COMPANIES WITH LONG-RANGE, END-TO-END SUPPORT In Africa and the Middle East, in Asia and Latin America, companies and financial institutions not only need financing; they also need assistance with implementing their projects and improving their practices, particularly environmental, social and governance practices.

In response, Proparco offers technical assistance to its clients in addition to the funding it provides. These services aim to support the responsible practices and innovative initiatives of the private sector, and thereby strengthen the impact of Proparco’s investments on local development.

Through these services, Proparco supports the financing of studies (feasibility studies, for example) and audits, as well as the implementation of its clients’ in-house projects, for which one or several consultants can be seconded.

This assistance is designed primarily to achieve the following: n Enhance the capabilities of financial

institutions (banks, investment funds, microfinance institutions) and help them comply with the E&S management requirements of their partners by training experts, promoting performance standards, assisting them with obtaining certification (ISO 14 001, OHSAS 18 001, SA 8 000), etc. n Heighten their ability to manage human

resources, manage their finances, control risk, combat money laundering and terrorism financing, and improve their management information systems. n Strengthen governance at companies in which Proparco invests (functioning of decision-making bodies, financial transparency, etc.). n Perform energy diagnostics to develop

energy management solutions (energy efficiency/renewable energies).

n Facilitate diversification through the launch

of new products and services to address the needs of the most vulnerable (low-income groups, women, young people, etc.), as well as of micro-enterprises, small and medium-sized enterprises, cooperatives and small farmers.

The aim of these technical assistance services is to help companies in the South adapt to a changing, increasingly competitive local and international environment.

Proparco finances them by drawing on: n The technical assistance facility of the Investment and Support Fund for Businesses in Africa (FISEA), held by AFD and advised by Proparco, which is primarily intended to build the capabilities of small and medium-sized enterprises in Sub-Saharan Africa; n The Governance Capacity Building Facility (FRCG), which finances projects to improve environmental, social and governance (ESG) performance; n Its own resources.

80 COMPANIES have benefited directly or indirectly from Proparco’s technical assistance since 2014.

1 This notion of corporate “performance” covers the objectives of efficiency (production), effectiveness (productivity), viability (profitability) and relevance (economic, social and environmental impacts).

TECHNICAL ASSISTANCE SOLUTIONS GEARED TO A WIDE VARIETY OF NEEDS AND SETTINGS

CAMBODIA GOLDEN RICE

OBTAINING CERTIFICATION ISO 14 001 AND SA 8 000

THE CLIENT COMPANY

THE TECHNICAL ASSISTANCE PROVIDED

Golden Rice (GR) is a company that processes, mills and sells prime-quality jasmine rice, much of it for export. It was founded in 2008 with the aim of adding value to the production and distribution of quality rice inside the country and positioning Cambodia in a market dominated until then

by Thailand.

In 2014, Proparco and GR signed a technical assistance agreement to put in place an environmental and social management system (in accordance with ISO 14 001 and SA 8 000, respectively). The aim is to enable GR to comply with international E&S standards – a springboard for breaking into additional markets.

GR has received two loans from Proparco (USD 7m in 2009 and USD 10m in 2013) for the development of its milling capacity and its international expansion. The company’s success has had a positive impact on the entire rice sector in Cambodia.

Following a thorough review of company practices, a detailed plan of action was drawn up. A single technical service provider, TÜV Rheinland, has been assisting Golden Rice staff with implementation ever since.

Designing environmental policies, drafting an E&S management programme, spelling out responsibilities, training managers, building employee awareness and creating an internal audit unit are all part of the joint effort.

SUB-SAHARAN AFRICA I&P AFRIQUE ENTREPRENEURS [IPAE]

THE CLIENT COMPANY The I&P (Investisseurs & Partenaires) impact investing group manages several investment vehicles, among them I&P Afrique Entrepreneurs (IPAE). The purpose of this €54m investment fund is to promote the development of SMEs in Sub-Saharan Africa, including microfinance institutions (MFIs).

IPAE views technical assistance as critical to small business success. Through expert missions, the fund helps boost the capabilities of staff at the beneficiary companies and facilitates the transfer of knowledge. In this way, IPAE contributes to the emergence of socially responsible businesses that add real value to the local economy, businesses with

KEY POINTS Direct technical assistance Proparco financing: €80,000 w Total project value: €160,000 w Date: 2014 w w

BOOSTING CAPABILITIES AT COMPANIES IN THE IPAE PORTFOLIO bright prospects for profitable, sustainable growth.

THE TECHNICAL ASSISTANCE PROVIDED Through the Investment and Support Fund for Business in Africa (FISEA), Proparco has mobilised €250,000 together with the European Investment Bank (EIB) to support IPAE’s technical assistance facility. Between 2012 and 2015, the facility funded 46 technical assistance assignments at 14 IPAE portfolio companies spanning 10 countries.

A wide variety of needs specific to the individual SMEs or MFIs were met in this way. For example, management information systems (MISs) were put in place or

strengthened, the management of human resources or sales and marketing was improved, technical and operational issues were addressed and company premises were made more energy-efficient.

KEY POINTS Delegated technical assistance (FISEA) w FISEA financing: €250,000 w Financing by IPAE portfolio companies: 15 % minimum w Date: 2010 w

TANZANIA EXIM BANK

ESTABLISHING AN ENVIRONMENTAL AND SOCIAL MANAGEMENT SYSTEM

THE CLIENT COMPANY

THE TECHNICAL ASSISTANCE PROVIDED

Established in 1997, Exim Bank of Tanzania (EBT) ranks fifth in the country in terms of total assets, and provides banking services to both retail and business customers, including SMEs. The bank has a particularly strong presence in import/export and agricultural value-chain financing.

In response, Proparco has drawn on resources from the AFD Group-financed Capacity Building Governance Facility (FRCG). That funding has been used to provide Exim Bank with a specialist consultant to help enhance its E&S policies and procedures, as well as to establish a system for assessing and monitoring any E&S risks associated with its investments, in accordance with the performance standards set by the International Finance Corporation (IFC). Proparco’s technical assistance also includes training for Exim Bank staff in how to

Since 2007, EBT possesses an E&S risk management system, but it needs to be strengthened if the bank is to keep pace with constantly changing international regulations.

TUNISIA UNIMED

operate the bank’s E&S management system.

At the same, EBT customers now have greater appreciation for EBT’s adoption of E&S best practices.

KEY POINTS Direct technical assistance (FRCG) FRCG financing: €30,000 w Total project value: €60,000 w Date: 2012 w w

INSTALLING A TRIGENERATION SYSTEM

THE CLIENT COMPANY Unimed is a Tunisian pharmaceuticals lab that manufactures and markets two main types of generic drugs: eye drops and injectable antibiotics. Founded in 1989, it has gained benchmark status in North Africa and West Africa. To support its growth, Proparco acquired a USD 5m holding in the company.

Drug production at Unimed requires sophisticated, energy-intensive equipment.

To keep costs down, achieve energy selfsufficiency and reduce its carbon footprint, the company set its sights on trigeneration, a high-efficiency power production process.

THE TECHNICAL ASSISTANCE PROVIDED To make that goal a reality, Unimed entered into a technical assistance agreement with Proparco in 2013. On this basis, Proparco has assisted Unimed with its request for tenders and with finding experts to conduct

a feasibility study. It has also provided project development support for installation of the trigeneration unit – writing specifications, choosing the best trigeneration solution, selecting a supplier, negotiating the contract and more.

Proparco’s role will also include training in the new technology for Unimed maintenance staff and initial performance measurement once the system is up and running.

KEY POINTS Direct technical assistance Proparco financing: €75,000 w Total project value: €150,000 w Date: 2013 w w

In addition to providing financing, its role is to promote the emergence of responsible and innovative economic and financial actors in developing and emerging countries. It also assists its clients in improving their environmental, social and governance performance.

Technical Assistance Unit 151, rue Saint-Honoré – 75001 Paris Tel.: +33 1 53 44 31 08 – Fax: +33 1 53 44 38 38 www.proparco.fr

01 53 17 30 40

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Proparco focuses on the key development areas, such as renewable energy-based infrastructure, agribusiness, financial sector, health and education. Through its work, Proparco has a powerful impact on job creation, access to essential goods and services and, more broadly, on poverty reduction and fighting climate change.

Copyright : J. Bardeletti (couverture), Pockafwye/Flickr (p.2), D. Gentilhomme (p.3), D. Degnan/Corbis (p.5)

Proparco – a subsidiary of the Agence Française de Développement (AFD) devoted to private sector funding – has been supporting sustainable development for almost 40 years. It operates in 73 countries in Africa, Asia, Latin America and the Middle East and helps finance and support financial institutions and corporate private-sector projects. Today it has almost 400 clients worldwide. Proparco is one of the leading European Development Finance Institutions, which together spearhead a large number of joint programmes.