Not One Size Fits All: The Varying Needs of Social Enterprises and Inclusive Businesses
What might broadly be considered a social or inclusive enterprise in the African, Caribbean, and Pacific (ACP) countrie, can take all sorts of business forms and models, notwithstanding variation in size, assets, growth trajectory, entrepreneurial culture, market access, social impact, etc. Given this diversity, it is important that impact investors and other providers of social finance have a more nuanced understanding of business features and needs when building their portfolios.
Business Council devises Southern Africa strategy
The Southern African Development Community’s Business Council (SADC BC) has developed its first ever five-year strategy and action plan with support from the ICR Facility. One of the challenges of launching such an initiative is to ensure that it achieves its goal. This is even more relevant in the Covid-19 era, where the business outlook may not be as positive and where businesses more than ever need to benefit from initiatives such as SADC BC.
Beating climate change: Why finance needs to flow to small entrepreneurs in the Pacific and Carribean
Entrepreneurs in the Caribbean and Pacific could help battle the ever more dramatic effects of climate change, but at the moment, there is little of the right kind of finance available to help these small businesses to take off. While billions of dollars of climate focused finance was flowing to the Pacific and the Caribbean, it wasn’t meeting the needs of social and green enterprises.
How can the countries of the African, Caribbean and Pacific accelerate their transition towards more climate resilient development?
Adapting to the consequences of global warming in ACP countries requires considerable investments in water management, flood protection, agriculture, healthcare, and infrastructure. Investment needs for this adaptation are enormous and it remains a challenge to unlock greater flows of finance towards climate resilient development. Development Financial Institutes and the private sector play an increasingly critical role here.
Financing Variety: A challenge for impact investors
Given the scale of social and environment challenges across African, Caribbean and Pacific (ACP) countries, access to finance for social enterprises and inclusive businesses – well-placed to tackle many of these challenges – becomes a priority. However, this remains a huge challenge for most entrepreneurs. There is a need for more flexible capital types - especially models that provide smaller investments.
What are the challenges for the development of crowdfunding in ACP countries?
Crowdfunding is a strategic investment vehicle complementary to existing tools, especially for companies which lack credibility with traditional financiers, including MSMEs and start-ups. In ACP countries, crowdfunding offers a new avenue to raise capital, and can help address a variety of issues including geographical isolation, banking exclusion, the limited size of addressable capital, etc. There are, however, constraints to its development.
Loans on Honor: a comprehensive mechanism to foster development by supporting MSMEs
The Loans on Honor are an economic development financing mechanism with an increasing usage in Africa and a real opportunity in Caribbean and Pacific countries. Often only recognised for its financial component, the Loan of Honor is in essence a multidimensional solution that combines business support and financing and has the ability to adapt its operations to the local needs of each territory.
Responding to the adaptation finance gap in 2021: catalysing private actors in ACP countries
African, Caribbean and Pacific (ACP) countries are highly vulnerable to climate change and have an urgent need to attract investment for climate change adaption and for building their economies’ resilience. This will require large-scale private sector resource mobilization, which currently faces critical challenges. But there are solutions how the international community can respond to these challenges.
Blended Finance – a powerful tool for DFIs
Blended finance as a tool has great importance in light of the current economic challenges and the cost of financing to small- and medium-sized enterprises (SMEs) in ACP countries. Instruments include concessional debt or equity, guarantees and insurance, technical assistance support, project preparation and design-stage grants as well as results-based financing. All these subjects were discussed with DFIs during a training session.