Trade-Related Financial Services - Belgium

This project is funded by the Belgian Government and the Vietnam Women’s Union, and jointly executed by the Belgian Technical Cooperation and the Department of Family Welfare, with the participation of 17 provinces, 87 districts, and 207 communes. The Belgian Government provided €3 million towards its financing, with the remainder coming from the Vietnamese, €670,866, and the Counter Value Fund, €230,864. The project had its head office in Hanoi and 17 branch offices in the provinces. It met its objective to reduce poverty in the 17 provinces it covers by providing access to high quality and diversified financial and business services to at least 100,000 households in these provinces by 2010. It worked in close cooperation with the Women’s Union to strengthen its micro finance programme for the medium and long term. The primary beneficiaries of the project were the rural poor and ethnic populations of the 17 provinces. It targeted four areas: access to financial services, access to business services, access to micro finance, and efficient programme management.

This is a direct loan of €700,000 and technical assistance of €17,000 to AGB Technoprint Group to modernize their printing equipment and hone their publishing skills.

The contract between BIO (The Belgian Investment Corporation for Developing Countries) and AGB was signed in December 2008, with an 8-year term for the loan, which allows a longer time to realize an adequate return on investment. The objective of the project is to provide import substitution in the area of print and to cre¬ate local jobs and homegrown skills. The improvement in machinery and publishing skills will enable AGB to be competitive at all levels for tenders.

BIO has granted a USD 15m senior loan to Banco Comercial e de Investimentos (BCI), a commercial bank in Mozambique. The loan has been extended in local currency through a swap with TCX, and will be used by BCI for on lending to SMEs. This is the first sizeable local currency transaction by a foreign lender, and also BIO’s first investment in Mozambique (a partner country of the Belgian Development Cooperation). BIO’s loan will enable BCI to provide loans in local currency with longer tenors to 15-20 SMEs, hereby contributing to maintaining or creating approximately 450 jobs. It will also demonstrate the viability of long-term local currency financing from foreign sources and hence contribute to increasing access to financing by SMEs, which have essentially local currency revenues and require long-term funding for investment purposes. This project is in line with BIO’s strategy of supporting private banks that contribute to the enhancement of financial inclu¬sion in developing countries, more specifically through the financing of SMEs.