The "choose Africa" initiative "is a real opportunity for financing and mentoring startups and SMEs", said the Senegalese Minister of economy, finance and plan, Amadou BA at the official launching ceremony of this initiative on 29 March 2019 in Dakar, the Senegalese capital. The French Minister of economy and finance, Bruno Le Maire, has described "choose Africa" as the "new face of partnership between France and Africa". The vision of France therefore aims to boost African entrepreneurship. The programme benefiting from a Fund of more than EUR 2.5 billion over four years should finance and accompany 10 000 small African companies over this period.
Two weeks after its launch in Kenya, by President Emmanuel macron, it was around Senegal to officially host the "choose Africa" initiative. "This generous idea of the French President, which embodies France's willingness to accompany the revolution of entrepreneurship and innovation in Africa", acknowledged the Senegalese Minister of economy, finance and plan.
A solution tailored for SMEs
Initiated by the AFD, "choose Africa" is a growth Accelerator, backed by the mobilisation of more than 2.5 billion euros dedicated to the financing of TPE and SME and startups in Africa by 2022. This is 1.5 billion euros in credit lines and guarantees granted to local banks to finance SMEs or guarantees granted to banks to cover the SME risk.
The other part is composed of one billion euros in equity: through direct investment in companies or through investments in private equity funds oriented towards SMEs. In total, 10 000 African companies are expected to be accompanied by 2022, including 600 in equity, through a stake in the capital of innovative young companies, via direct investment or through funds of venture capital investment.
Despite the political will of the Senegalese authorities, including the rapid entrepreneurship delegation (der) with a Fund of 30 billion CFA francs, which will be increased to 100 billion CFA francs, for startups and SMEs, young entrepreneurs are in the face of a problem of access to finance. That is why, "choose Africa", the 2.5 billion Fund over a four-year period for entrepreneurship on the continent is a major support. Entrepreneurship has an unprecedented enthusiasm.
According to Amadou BA, "despite the constraints associated with financing, qualifications, inputs, market access, etc., African entrepreneurs are trying to bring new ideas every day. »
However, the lack of financial means increases the failures noted in the mastery of the supply chain and marketing. This lack of financial support limits their leeway to seize the opportunities offered by the rise in power, he said.
Under this report, the "choose Africa" initiative is, alongside the efforts of the sub-regional organizations, the African Union through its agenda 2063, and the African Development Bank-a real opportunity for funding and mentoring micro and medium-sized enterprises, concluded the Senegalese Minister.
Financing modalities for small businesses, SMEs and startups
The "choose Africa" programme allows any entrepreneur to identify the type of financing suitable for his project or company and to present it directly to AFD and PROPARCO or their financial partners. PROPARCO and AFD have several financing solutions for small businesses.
However, beyond financial support, African entrepreneurs also need to be accompanied in their development. To address this need, the second part of "choose Africa" is about training entrepreneurs to improve their environmental, social and governance practices. This is to generate an ecosystem conducive to entrepreneurship and to small and medium-sized enterprises.
In Africa for several decades, AFD has given priority to the continent. In 2015, the Agency invested almost 3.1 billion euros in sub-Saharan Africa, representing 38% of its total funding. The sum seems enormous, but its impact has been limited so much the needs of the continent are important. Today, only 20% of SMEs in Africa have access to the Bank loan and 87% of startups are deprived of financing, according to AFD figures.