news - Dutch SMEs bring skills and technologies to Lower Income Economies

‘The FMO Emerging Market Fund (FOM) enabled companies to transfer capital, technologies and management approaches to countries where these are yet to be fully developed’, is the conclusion from a study carried out by consultancy and research company Ecorys. The supported companies are connected to widespread networks delivering local economies, access to markets and secure inputs. Three case studies show that, although the business climate in the countries where investments took place can be challenging, the funded companies have managed to adapt and thrive, fully utilizing local conditions and opportunities.

All cases resulted in sustainable economic growth locally, including the stimulation of employment. Also measures were taken to reduce the negative impact on the local environment and on scarce (natural) resources. Commercial local or international funding was not available for these companies, making FMO’s funding key for realising these projects at this pace. If the companies would have had to finance the full investment themselves, it would have taken much longer or the investment would not have taken off at all. Additionally, the financial banking knowledge of FMO contributed to their business development.

Tulip Cocoa Processing Ltd, originally part of a group of Dutch cocoa trading companies, expanded its cocoa production capacity in Nigeria. Tulip trained over 16,000 farmers up to date. FMO facilitated the development of a traceability system of cocoa farmers, development of HR policies and training on good agricultural practices. Desert Joy SARL in Tunisia expanded its greenhouses for growing sweet mini tomatoes thereby supporting 200 jobs. Innovative technical solutions and democratic style of management were introduced. This attracted other Dutch investors in the region and made local farmers seek for partnerships to get access to new technologies which influenced market development. HFT Seedservices SA expanded the production of hybrid vegetable seeds in Guatemala, supporting 190 (mainly female) jobs. For other companies in the region, HFT set the local standard for to good labour conditions.    

The Emerging Market Fund of FMO is now integrated in the Dutch Good Growth Fund which is managed by RVO.

About FMO

FMO is the Dutch development bank. As a leading impact investor FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development, and has a 45-year proven track record of empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With a committed portfolio of EUR 8.9 billion spanning over 85 countries, FMO is one of the larger bilateral private sector developments banks globally.

For more information please visit www.fmo.nl.