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Since 2021, AFC is supporting GIZ in the implementation of the project Sustainable Employment through Agribusiness (AgriBiz), which will run until 2024. The project aims at improving the competitiveness in domestic, regional and international markets of 500 micro, small and medium-size enterprises (MSMEs) in Ghana's informal and formal agribusiness sector. Special attention is placed on MSMEs headed by women and youth, with the aim of increasing profits and of creating around 1.000 full time jobs.
In an integrated approach, the project strengthens technical and management capacities, focusing on processing, trading and marketing MSMEs. One of the key instruments of implementation is the GIZ developed SME Business Training & Coaching Loop. By combining business training and individual coaching, the SME Loop supports various growth paths of SMEs. Thereby the support is customized to suit the needs and requirements of the individual enterprises. The SME Loop is suitable for formal and informal enterprises, literate and illiterate business owners and covers all sectors of the local economy. The SME Loop`s key value is to boost the local economy, to foster inclusive structural change and to create economic perspectives particularly for the growing young generation.
In the context of the AgriBiz programme, 135 out of 148 SMEs have successfully completed the SME Loop training, which consisted of 2 formal trainings and 13 individual coaching sessions over a period of 6-7 months. SMEs were supported via 5 local service providers (with 30 coaches, 5 trainers and 5 backstoppers), which in turn were trained and backstopped by AFC international short-term and national long-term experts. The trained SMEs pertain to a large variety of agribusiness sub-sectors, including input providers, aggregators (rice, soja, maize), processors (groundnut paste and snacks; shea butter; spices; juices; gari products; coconut chips, milk and oil; poultry feed; rice milling; palm oil), ICT service providers as well as poultry farmers. To date, the training has had the following positive effects:
- Job Creation: Since the beginning of the training and coaching support, 335 new Full-Time-Equivalent (FTE) jobs have been created, of which 179 are for women and 295 for young adults.
- Profit: 90 out of the 135 MSMEs have increased their average monthly profits compared to before the Loop despite the very challenging macro-economic situation in Ghana.
- Investment: A total equivalent of approximately EUR 170.000 were invested by 56 SME Loop enterprises (23 women-led) in the first half of 2022, mainly using the companies’ own profits. In addition to that, 10 MSMEs (3 women-led) have been able to successfully access loans, amounting up to a total of EUR 390.000. Furthermore, the share of MSMEs which now have a viable, up-to-date business plan has increased from 27% to 65%.
- Employment Conditions:
- The number of staff of supported MSMEs that has a written contract has almost tripled.
- The number of MSMEs that now provide additional benefits to their employees, e.g. registering them for the Ghanaian Social Security System (SSNIT), has increased by 41% (from 56 to 79 MSMEs).
- Business Formalisation:
- The share of MSMEs that have completed all mandatory business registrations has increased from 49% to 69% (these include for example registration with Food & Drugs Authority, Environmental Protection Agency or Ghana Standards Authority). The share of MSMEs that do not have started to acquire all mandatory business registrations has reduced from 23% to 8%. The remaining ones are currently still in the registration process.
- The share of MSMEs that are working on or have completed their tax registration has increased from 42% to 64% over the last 6 months.
While the 135 SMEs that graduated have thus increased their competitiveness in a sustainable fashion, the process to select the next group of participating MSMEs has already started.
If you would like to learn more about this project, please contact our project manager Matthias Webendörfer (matthias.webendoerfer [at] afci.de).