Guyanese businesses could bid for grant funding up to one million pounds Sterling from the 14.7 million pounds Sterling Business Linkages Challenge Fund (BLCF) funded by the UK's Department For International Development.
Stabroek News
August 28, 2001
The fund, established last year and available to 18 countries including Guyana, has a fixed amount of 14.7 million pounds Sterling and its administrators are hoping that once it is successful in achieving its objectives, it will be replenished by the British government.
The fund was officially launched in Guyana yesterday by BLCF Director, David Jones at Le Meridien Pegasus.
Jones told Stabroek News that the main criteria for project financing were the creation of business linkages that improve competitiveness and impacted on the lives of the poor.
He said that all sectors, excluding the illegal sector, could prepare projects for consideration in the competitive bidding process, which screened the best bid and allotted financing from a low of 50,000 pounds Sterling to one million pounds Sterling.
So far, four projects have benefited under the BLCF in South Africa. One project was to cover street lighting in a township with the linkage coming via an assembly plant being set up for the lights with the parts imported from a company in the UK. The project was expected to enhance security in the area, create jobs and improve the quality of life of the township. A sum of 700,000 pounds Sterling, averaging 45 per cent of the project worth, was approved for this project.
A second project covered the involvement of previously disadvantaged persons (Blacks in South Africa) in sports management with expertise being levied from the UK. A company is being set up to train lower level sports coordinators for big events. A sum of 180,000 pounds Sterling was approved.
In Botswana, a project to covert tailing ends into micronutrient fertilizer and house bricks has been approved. The technology is being imported and 150,000 pounds Sterling have been approved for this project.
And in Lesotho, a bee keeping and honey production project was approved with funding of 200,000 pounds Sterling being made available. The funding to each of the project approximates 45 per cent of the total cost of the projects.
Jones indicated that the fund expected to have a 50/50 arrangement with the projects it approved but said that in some cases, this could go up as high as 70/30.
Guyana is among nine Caribbean states, which can benefit from the BLCF. The fund is open to any registered private sector enterprise, as well as to business and civil society organisations. Government projects, with strong private sector participation could also be eligible for funding.
Jones indicated that while the fund was not in a position to provide contacts for businesses in Guyana on areas in which they could link up with international firms, such possibilities could be explored to allow local firms to benefit from the project.
However, the project is not limited to linkages with foreign companies but includes local linkages in the business and services sector.
The fund defines linkages as that which will mobilise enterprises to invest in and improve their competitiveness such as skills transfers, information and technology, improving sourcing, product supply and market access.
Linkages could include management contracts or marketing agreements; joint ventures, partnerships or franchising agreements, large-small firm procurement and out-sourcing agreements or licensing agreements; long-term development and investment agreements or contracts between private sector enterprises and civil society linked to alternative trade solutions.
Potential areas of focus include linkages to improve export performance; linkages that strengthen the competitiveness of domestic producers in the local market; linkages that lead to improvements in the policy and regulatory climate for business; technology sharing or improve environmental performance. However, what has to be demonstrated in all cases, is that the poor will benefit and that the projects are commercially viable.
The four-year projects allow for two rounds of bidding each year. In Guyana, bidding could start immediately in a two-stage process, twice per year (every six months). In the first stage, concept notes are required on the proposed project's new linkages and then if the project is selected for short-listing, a detailed application is required.
Those requiring more information can surf the website www.challengefunds.org.
At the launch of the fund yesterday, President Bharrat Jagdeo welcomed the initiative, expressing his satisfaction that one of the criteria for acceptance was impacting on poverty. He was also pleased that it had a heavy emphasis on private sector participation.
The fund in Guyana will be administered by Deloitte & Touche and is being facilitated by the Caribbean Export Development Agency (CEDA).