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AfDB-EMRC SME Forum Session 8 Diogo Araujo
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AfDB-EMRC SME Forum Session 8 Diogo Araujo

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  • 1. Investments through SME partnerships SOFID an innovative sollution by Diogo Gomes de AraújoAfDB-EMRC SME Forum 6 June 2011Bridging the Missing Middle Gap in Africa Lisbon
  • 2. Summary1.SOFID as an innovative solution2.SOFID vs. traditional banking3.Eligibility criteria4.What is on offer?5.Examples of projects
  • 3. 1. SOFID as an innovative solution
  • 4. 1. SOFID as an innovative solution• Portuguese DFI with SME focus• Regulated by Portugal’s Central Bank• HQ in Lisbon• Twofold mandate: – Support Portuguese companies and business partners investing in emerging and developing countries – Promote sustainable private sector development in those countries
  • 5. 2. SOFID vs. traditional banking ADDITIONALITY: SOFID only participates in operations where it adds value• Sustainable investment: social and environmental responsibility, job creation, knowledge transfer, wealth distribution• Political comfort: public-private shareholders• Flexibility: adjust to client needs• Focus and specialisation: partnerships, products and markets
  • 6. 3. Eligibility criteria• Minimum 20% Portuguese stake• Productive sectors (no real estate)• Brown and green-field projects• Economic and financial viability with social and environmental concerns• Preferably in PARTNERSHIP with local banks
  • 7. 4. What is on offer?• Tailor made financial products  Loans  Guarantees  Equity  Funds• Financial services  Financial advice  Resource mobilisation
  • 8. 4. Loans and Guarantees• Commercial terms (no soft money)• Grace period up to 3 years• Maturity up to 10 years• Hard currency• Local bank provides local currency
  • 9. 4. Funds• ITF – EU-Africa Infrastructure Trust Fund• NIF – Neighbourhood Investment Facility• InvestimoZ – Portuguese Fund for Investment in Mozambique
  • 10. 5. Case study 1HIGEST • Poultry industry in Mozambique • Sells chicks and feed to local farmers • Buys back chickensLeading FI: Millennium bim • Frozen chicken is suppliedTotal investment: € 2 M • Network of “containerSOFID guarantee: € 0,5 M shops”Sponsor: Higest 10
  • 11. 5. Case study 2PREMAP • Production, supply and sale of precast concrete parts • Maputo and Dondo (MZ) • Upgrade operations and expand productionLeading FI: SOFID capacityTotal investment: € 0,7 M • Locally produced goods forSOFID Loan: € 0,4 M the domestic marketSponsor: Concrepax 11
  • 12. 5. Case study 3PRIO FOODS • Agricultural produce for the food processing industry • 80 direct staff + 1,000 local farmers • Sofala region (MZ)Leading FI: SOFID • Guarantee secured financeOther IF: BCI from a local bankTotal investment: € 2,3 M • Crop diversification andSOFID guarantee: € 1,7 M supply to domestic marketSponsor: Prio 12
  • 13. African sayingIf you want to go fast, run like the gazelle If you want to go far, run together like the buffalo
  • 14. Thank you Diogo Gomes de Araújowww.sofid.pt • sofid@sofid.pt