Highlighted results

Support for 12,700 business plans for investment or trade

345,000 direct jobs supported through PSD programmes

Introduction

In developing countries, far more young people enter the labour market each year than new jobs become available. For this reason, the Netherlands has given priority to promoting youth entrepreneurship and youth employment, especially in the focus regions. For example, the Netherlands participates in an African Development Bank innovative fund for youth entrepreneurship. We also launched our own Youth Employment Challenge Fund, and with the Orange Corners programme we set up local initiatives to help young people in Africa and the Middle East start their own businesses. Through programmes like Local Employment in Africa for Development (LEAD) and the Netherlands Senior Experts Programme (PUM), young entrepreneurs can receive coaching. Agriterra strengthens agricultural organisations and cooperatives, making farming an attractive option for young people. Dutch investment in the One Acre Fund is raising the incomes of small-scale farmers. The Dutch Good Growth Fund provides starters and social entrepreneurs with new forms of funding and technical assistance.

Results 2019

Good jobs and stable living incomes give people prospects and contribute to combating poverty, conflict and irregular migration. The Netherlands supported around 12,700 business plans for investment or trade and 345,000 direct jobs through business development programmes. Making supply chains more sustainable improved working conditions for more than 600,000 workers, funded training of around four million small-scale farmers and ensured sustainable soil management on more than 7.5 million hectares of farmland. With advice from Dutch experts, producers in developing countries could export products valued at more than $830 million. Twenty construction projects were completed, and funding was secured for another 48 projects. Thirty-four million people are expected to benefit from this new infrastructure. Nearly 10 million people gained access to financial services. More than 100 new financial products were developed for disadvantaged groups. As good governance and a favourable business climate are preconditions for a healthy economy, the Netherlands supports more than 500 local trade unions and farmers’ and entrepreneurs’ organisations. Support for tax authorities has also been expanded, in accordance with the agreements in the Addis Tax Initiative. This helps countries generate more revenue.

Result areas

Business development Sustainable production and trade Financial sector development Economic governance and institutions Infrastructure

Featured project private sector development

First microfinance bank for women in Afghanistan

FMO, the Dutch development bank, invests in financial institutions and businesses that are essential to building local economies.

MASSIF is a €550 million fund managed by FMO for the Dutch government. MASSIF targets small-scale entrepreneurs with no easy access to finance. These are young people aged 18 to 25, women and refugees. In 2018, MASSIF reached 90,000 small-scale entrepreneurs and around 1,500 small and medium-sized enterprises in the most difficult markets in the world. An example is FMFB-A, the first microfinance bank in Afghanistan. FMFB-A was the first bank to open a branch with women staff serving only women customers.

Business development

Business development in low- and middle-income countries

A good job is the best way for people to escape poverty. Businesses create jobs and generate more stable incomes. The Netherlands is strengthening entrepreneurship in low- and middle-income countries, focusing on young people and women. Dutch businesses are encouraged to invest in these countries and trade with them. This year, once more, support was given to more business activity and employment than was envisaged. Around 12,700 business plans and 345,000 direct jobs received support: a result that far exceeded the target. The number of new jobs also continued to grow. These achievements, surpassing the targets, reflect increasing use of the Dutch Good Growth Fund (DGGF) and the Health Insurance Fund, and the increase in programmes focusing wholly or in part on job creation.

Open result area

Results

Indicator

Businesses with a supported plan for trade or investment

Progress

On track

The number of business plans for investment or trade in low- or middle-income countries was more than three times higher than planned this year. More than 90% were for local or other businesses. Slightly fewer than 10% were plans by Dutch businesses for investment or trade in low- or middle-income countries. This result far exceeded expectations due to faster project development, enabling the Dutch Good Growth Fund in particular to invest more in small and medium-sized enterprises by assisting startups and other firms.

The Netherlands provides advice and financial resources to support the launch and growth of businesses. The progress made with business development is measured on the basis of the number of business plans for investment or trade in low- and middle-income countries receiving Dutch support through private sector development programmes.

Indicator

Direct jobs created thanks to private sector development programmes

Progress

On track

345,000 direct jobs in businesses supported by private sector development programmes. This number exceeded the target of 250,000 jobs, continuing the upward trend.

Successful business development leads to more and better jobs in the private sector. In accordance with agreements between international donors, annual monitoring mainly focuses on direct jobs in businesses supported by private sector development programmes.

Indicator

Indirect jobs supported thanks to private sector development programmes

Progress

On track

1,921,000

Nearly two million indirect jobs were supportedthanks to private sector development programmes, in particular through infrastructure development.

Apart from direct jobs, some programmes also report on the indirect jobs they help support. This is the case with suppliers to businesses receiving support, or the expected macroeconomic impact of infrastructure support. The different types of employment support are measured differently. For this reason, indirect jobs are recorded separately.

Indicator

Private co-investments

Progress

On track

€375 million

Private co-investments by businesses and other private organisations like banks, knowledge institutions and NGOs under 10 Dutch private sector development programmes totalled €375 million.

To achieve the UN Sustainable Development Goals by 2030, private investment and know-how are becoming increasingly important, in addition to public investment. This was the conclusion reached by government leaders attending the Financing for Development conference in Addis Ababa, Ethiopia in 2015. For this reason, various Dutch programmes provide advice and financial resources to support local and Dutch businesses, to mitigate the higher risk of investing in low- and middle-income countries. The degree to which businesses and other private organisations like banks are able and willing to bear these higher financial and political risks is monitored on the basis of the extent of private co-investment under the private sector development programme.

Ruth Namaganda and Kibinge Coffee Farmers’ Cooperative Society (KCFCS)

Ruth Namaganda was born as one of 14 children to a family of farmers in Western Uganda. At the age of 26 she was allowed to rent land on which she could grow food crops. She started a savings group with other women farmers. The Kibinge Coffee Farmers’ Cooperative Society (KCFCS) provided her with training in financial management. From that time, Ruth has been an active member of the cooperative, helping management with their day-to-day tasks.

Agriterra started working with this coffee cooperative in 2014. The cooperative had set itself the aims of both becoming market leader for high-quality coffee and improving the standard of living of its 1,400 members. Over 300 members received training in financial management. In 2018 the cooperative set up its own production facility, which supplies coffee to Fair Trade certified buyers. Ruth is active in the youth council that provides the cooperative with farm management services.

Agriterra supports KCFCS and 340 other cooperatives and agricultural organisations in Africa, Asia and Latin America.

Agri-wallet for farmers

With Small Business Innovation Research (SBIR), the Dutch government challenges entrepreneurs to solve social problems using innovative products and services. Agri-wallet is one such successful innovation.

Agri-wallet provides a mobile financial platform that uses blockchain technology to connect farmers with buyers for their products and suppliers of their inputs. They pay using mobile money. Agri-wallet also serves as a digital purse for saving or borrowing. Affiliated entrepreneurs pool services and earn money from the transactions of suppliers, insurance companies and financial institutions.

The project aims to provide 10 million farmers in Africa with a digital Agri-wallet. This will enable them to act as catalysts for sustainable, circular food supply chains, food security and climate resilience. To achieve this goal, Agri-wallet is already working with the World Bank and the World Food Programme (WFP).

RVO.nl IATI-website

RVO.nl Open Data-website

Sustainable production and trade

Fast lane for traders crossing the border between Kenya and Uganda. Credit: Anouk Baron

Sustainable production and trade

Good jobs and stable living incomes reduce poverty. Programmes for sustainable international supply chains have improved the working conditions of more than 600,000 workers, funded training of around four million small-scale farmers and ensured sustainable soil management of more than 7.5 million hectares of farmland. These results far exceed expectations. Market access also increased, with advice from the Centre for the Promotion of Imports from Developing Countries (CBI) enabling producers in developing countries to export products totalling $834 million, of which $465 million to EU countries and $369 million to other parts of the world.

Open result area

Fast lane for traders crossing the border between Kenya and Uganda. Credit: Anouk Baron

Results

Indicator

Workers with improved working conditionsin accordance with international agreements

Progress

On track

615,000

The working conditions of 615,000 workers have improved. Moreover, the Sustainable Trade Initiative (IDH) is committed to gender policy and payment of a living wage. The International Labour Organization’s (ILO) Better Work programme works with governments in textile-producing countries to promote compliance with fundamental labour standards and is now implementing a gender strategy.

Developing countries need knowledge and technology to raise and improve their productivity. By applying international production standards, developing countries can take part in sustainable trade worldwide. This raises living standards and has a beneficial impact on the environment and on working conditions in sectors where many people work.

To ensure that higher living standards benefit all participants in international value chains, the Netherlands urges Dutch businesses to comply with the OECD Guidelines for Multinational Enterprises on corporate social responsibility. The Netherlands actively supports initiatives to improve working conditions for workers in various production sectors in developing countries. These range from agricultural production (palm oil, cocoa and soya) to labour-intensive sectors like the clothing industry. The ILO, multinational enterprises and NGOs are partners in these initiatives.

Indicator

Training small-scale farmers in sustainable farming practices

Progress

On track

More than four million small-scale farmers received training in sustainable farming methods. This figure was twice as high as expected.

Various programmes work from the Netherlands to accelerate sustainable production within worldwide value chains for, for example, palm oil, cocoa and soya. These programmes promote joint adoption of sustainable production methods through worldwide cooperation between businesses (the major buyers), NGOs, government bodies and knowledge institutions. Training small-scale farmers in sustainable farming practices is essential for effective dissemination of these production methods and participation in supply chains. The topics addressed include not only better farming and crop protection methods and compliance with sustainability standards and certification, but also action to strengthen the position of workers and to improve employment conditions (wages, overtime, child labour and gender issues).

Indicator

Hectares under sustainable land use

Progress

On track

7,659,000

Sustainable land use applied to more than 7.5 million hectares of farmland

IDH and Solidaridad (2016-2020) work from the Netherlands to accelerate sustainable production within worldwide value chains for, for example, palm oil, cocoa and soya. These programmes promote joint adoption of sustainable production methods and sustainable land use through worldwide cooperation between businesses (the major buyers), NGOs, government bodies and knowledge institutions.

Indicator

Exports from low and middle-income countries in millions of dollars

Progress

On track

Value in USD

With advice from the Dutch Centre for the Promotion of Imports from Developing Countries (CBI), producers from low- and middle-income countries could export products totalling $834 million, of which $ 465 million to EU and EFTA (European Free Trade Area) countries and $369 million to other parts of the world.

Developing countries need knowledge and technology to raise and improve their productivity. By professionalising management and applying international production standards, exporters from developing countries can expand their markets abroad. The Netherlands supports producers in developing countries with marketing expertise and application of production standards, thus enabling them to export their products. The Netherlands also works with local governments and customs authorities to support trade facilitation programmes in low- and middle-income countries.

She Sells Shea

Through the She Sells Shea project, women in Burkina Faso and Mali learn how to harvest sesame seeds, which the French company OLVEA processes into edible oil. The women also sell shea nuts to OLVEA for use in cosmetics, for example. Because the seeds and nuts are harvested at different times of the year, the women can earn an income all year. This raises their income, and makes them less vulnerable to financial setbacks or failed harvests due to climate change. The project has raised the income of 31,000 women in Mali and Burkina Faso. Women entrepreneurs receive training to improve the quality of their crops, enabling them to raise their prices. They also learn how to use crops for their own consumption, thus enhancing food security in these countries.

Arte Groep working on a child labour free zone in India

Around 152 million children worldwide – nearly one in ten – are engaged in some form of child labour. These children are denied a proper childhood and decent education.

Mining is one of the sectors where many children are put to work, in the stone quarries in India for example. Poverty is often rife in the areas around these quarries, so that children are forced to work. Arte Groep produces natural stone worktops and source their granite from countries like India. Using a grant from the Fund Against Child Labour (FBK) Arte set up a project with the aim of enabling all 2,200 children in the production area to go to school.

When the project started, 250 children in the eight neighbouring villages did not attend school. Working with a local NGO, Arte visited schools and is working to change parents’ mentality. This is gradually leading to peer pressure on parents to send their children to school. Now, a year later, dozens of children attend school.

Financial sector development

Financial sector development

Access to financial services is crucial for poor people and small businesses in enabling them to save safely or invest. For this reason special new or improved financial products or innovative services are being developed with the main goal of reaching this target group. As a result, 10 million people gained access to financial services while programmes for financial inclusion led to the development of more than 100 new financial products.

Open result area

Results

Indicator

Businesses or individuals accessing financial services

Progress

On track

9,445,000

9,445,000 people accessed financial services through FMO’s MASSIF fund and other sources. Through the Health Insurance Fund, more than 200,000 gained access to decent healthcare services. The Global Index Insurance Facility insured more than 820,000 small businesses and small-scale farmers against major loss of income risks. More results are expected as implementation of these programmes progresses.

Access to financial services is crucial for poor people and small businesses in enabling them to save safely or invest. For this reason special new or improved financial products or innovative services are being developed with the main goal of reaching this target group. A good example are facilities for women entrepreneurs with little or no credit history. The number of people registered for a special insurance policy for the poor developed with Dutch support is included in this indicator. These special insurance programmes protect poor people against substantial, unforeseeable loss of income risks, such as illness or failed harvests through severe weather. Examples include agriculture and climate insurance for small-scale farmers and the Health Insurance Fund’s electronic wallet that guarantees access to healthcare services for women and children. The number of people with access to financial services has risen substantially due to harmonisation of this indicator with international standards. Further harmonisation will take place in the next 12 months.

Indicator

Introduction of new or improved financial products

Progress

On track

103

103 new financial products were developed through programmes for financial inclusion. M-TIBA reached more than 800,000 users. A capital market programme in Morocco received support through FIRST. This programme assisted in the drafting of legislation governing property investment funds and stock exchange investment funds to encourage small and medium-sized businesses to obtain a listing. The first Sukuk (Islamic government bond) will be issued soon. The Global Index Insurance Facility launched 62 index insurance products.

Financial services are essential for economic development. Access to financial services is crucial to enable people to save safely, take out insurance or invest in a business. This applies in particular to poor people in rural areas and small businesses in countries with weak financial markets and inefficient financial institutions. For this reason, the Netherlands encourages the development of innovative or improved financial products tailored to the specific needs and local constraints of low-income groups. Examples include the Health Insurance Fund, agriculture and climate insurance for small-scale farmers developed by the Global Index Insurance Facility, and facilities for women entrepreneurs with little or no credit history.

Al Majmoua Microcredits and empowerment of women and young people

Al Majmoua Microcredits and empowerment of women and young people

Fatima is a graphic designer who started her business after Al Majmou, Lebanon’s leading microfinance provider, gave her a loan to cover her startup costs. Fatima is a typical client of Al Majmoua, which mainly provides financial services for women entrepreneurs in both urban and rural areas.

This bank’s core activity is providing individual loans for women. Women constitute only 24% of Lebanon’s working population, and, at 34%, youth unemployment is high. The influx of Syrian refugees has not improved matters. Al Majmoua’s free-of-charge services in the field of business development and empowerment present both women and young people with economic opportunities.

FMO funds Al Majmouna from the MASSIF fund. In 2018, MASSIF invested €72.7 million in local entrepreneurship, reaching around 90,000 micro-entrepreneurs and 1,500 small and medium-sized enterprises.

massif.fmo.nl

Microcredits and empowerment of women entrepreneurs

ASA fish farm in Ethiopia

Africa Sustainable Aquaculture (ASA) received a loan from the Dutch Good Growth Fund (DGGF) to purchase and install equipment for a fish farm. This will enable ASA to create jobs for the local community, improve local food supplies, and generate income from exports.

The DGGF supports private sector development, with a focus on creating good jobs. It provides funding for projects with a sound business plan if the business is unable to acquire funding through the normal channels. Banks are seldom interested, given the risks and limited size of the loan. Apart from providing funding, DGGF advises the entrepreneur on implementing an action plan to ensure corporate social responsibility. In this way, DGGF generates thousands of jobs and supports many businesses each year.

Economic governance and institutions

Economic governance and institutions

Sound economic governance and professionally organised institutions contribute to a business climate in which the private sector can grow. The Netherlands therefore supported more than 500 organisations that help farmers, entrepreneurs and employees strengthen their economic position by organising in cooperatives, employers’ associations and trade unions. To generate more revenue for development, it is essential that the tax and customs administrations of low- and middle-income countries function properly. The Netherlands is therefore stepping up cooperation with the tax and customs administrations of developing countries, in line with donors’ pledges in the Addis Tax Initiative.

Open result area

Results

Indicator

Economic insitutions supported

Progress

On track

503

The Netherlands helps farmers, entrepreneurs and employees organise and thus increase their earning power, supporting 503 local organisations. The Netherlands also stepped up cooperation with the tax and customs administrations in developing countries, in line with the pledge made by donors in the 2015 Addis Tax Initiative to double their efforts by 2020. The aim is to improve tax legislation and enable tax and customs administrations to function more efficiently.

Sound economic governance and professionally organised institutions contribute to a business climate in which the private sector can grow and workers can improve their economic position. By organising, farmers, workers and entrepreneurs can increase their earning power. The Netherlands therefore supports more than 500 organisations that help farmers, entrepreneurs and employees to strengthen their economic position by organising in cooperatives, employers’ associations and trade unions. Examples include training in operational management and negotiation or leadership skills to exert influence on governments for better legislation and regulations. To generate more revenue for development, it is essential that the tax and customs administrations of low- and middle-income countries function properly.

Better protecting trade union rights in supply chains

The Dutch signatories to the ICSR agreement on sustainable garments and textile often identify suppliers’ failure to respect freedom of association (trade union freedom) as one of the main risks. CNV Internationaal shows them how they can address this problem. Trade union freedom is one of the main preconditions for safeguarding trade union rights in the textile supply chain and to enable steps forward in other areas, such as payment of a living wage. In this video, an employer from Cambodia talks about his experience with the advantages of a good social dialogue with the trade unions.

Fair Wear, CNV Internationaal and Mondiaal FNV work with clothing brands in Europe and with factories and workers in Asia and Africa to improve working conditions. These organisations have entered into a partnership with the Ministry of Foreign Affairs.

Infrastructure

Infrastructure

Access to reliable infrastructure is essential for private sector development and to improve poor people’s quality of life. Infrastructure projects call for a long-term commitment from all parties involved, including crucially, reserving the necessary funding with partners. Twenty projects were completed and funding secured for another 48. The expected number of end users is an indicator of reach and social impact. Completed projects and projects for which funding has been secured are expected to provide 34 million users with access to new or improved infrastructure.

Open result area

Results

Indicator

Completed and planned infrastructure projects

Progress

On track

20 projects have been completed and funding has been secured for another 48. The Development Related Infrastructure Development Vehicle (DRIVE) and Develop2Build (D2B) together secured funding for 10 projects, Building Prospects for 9 projects and the Private Infrastructure Development Group (PIDG) for 18 projects.

Nine projects were completed under the development-related export transactions programme (ORET). DRIVE adapted administrative rules to get projects in the pipeline faster, following the example of Develop2Build (D2B). According to a recent evaluation of the Infrastructure Development Fund (IDF), planned projects and secured private capital have exceeded expectations.

Access to reliable infrastructure is essential for private sector development and to improve poor people’s quality of life. Infrastructure projects call for a long-term financial commitment from all parties involved.

Reserving the necessary funding with partners is crucial for completion of infrastructure projects. For this reason, the number of planned projects with signed funding agreement, is a major indicator of the progress of infrastructure development programmes.

In 2019 the DRIVE portfolio grew substantially due to the changes to administrative rules made in 2017. Total commitments have now risen to over €300 million. The D2B programme is also moving forward fast, and committed to 18 new projects in 2019. Work is under way on follow-up to both DRIVE and D2B from 2021.

Indicator

End users with access to new or improved infrastructure

Progress

On track

34 million

Completed projects and planned projects for which funding has been secured are giving 34 million people access to infrastructure.

The number of end users expected to gain access to new or improved infrastructure is an indicator of its expected reach and social impact.

This indicator is generated using estimated numbers of end users of (1) planned projects for which partners have signed funding agreements and (2) projects completed in the reporting year.

The Private Infrastructure Development Group (PIDG), FMO’s Building Prospects, the development-related export transactions programme (ORET) and the Development Infrastructure Facility (ORIO) have all proved effective in improving infrastructure services.

Chiansi irrigation project

In 2019 funding was secured for the Chiansi irrigation project in the Kafue District of Zambia. This is a good example of how the Dutch bilateral Infrastructure Development Facility (ORIO) influences multilateral and private sector instruments with its focus on the public sector.

A $5 million grant was awarded through ORIO. The Private Infrastructure Development Group (PIDG) provided a total of $18.5 million in funding through InfraCo Africa and the Technical Assistance Facility.

Construction of irrigation infrastructure has now begun for a total surface area of 3,500 hectares. This project will give 960 small-scale farmers access to irrigation for their land. This is essential for incomes, food security and adaptation to climate change.

Credit: Ayitey Hammond

Background information theme private sector development

Glimpse into the future

The focus on the Middle East, North Africa, Sahel and the Horn of Africa marked a shift in the Netherlands’ commitment to fragile states. The countries in these regions need more intensive and prolonged support to develop feasible business plans and generate employment. As a result of these policy choices, the rate at which projects are developed and results achieved is likely to slow down. However, the impact of private sector development in these regions will be considerable, given the lower living standards. In the Palestinian Territories, for example, extremely worthwhile results have been achieved with young people who found work with their own ICT startups after undergoing training supported by the Netherlands.

Additional sources

You can find exactly how the budget was allocated in 2019 and which projects were funded on our budget website.

  1. Visit the website
    Programme budget Foreign Trade and Development Cooperation
  2. Select financial year 2019
Theme website

Business for Development

Expenditure by channel

Metric

The budget in this figure is for the year 2019 and does not completely correspond with the results on this page, which have been collected between Oct 2018 and Oct 2019. More information on this can be found on the 'About the results report' page.