The Africa Enterprise Challenge Fund (AECF) is inviting private sector companies to compete for investment support for their new and innovative business ideas. The AECF makes matching grants or soft loan funding of up to US$1.5 million available to projects and business ideas with the greatest rate of return against its objectives.
The AECF has recently launched three new competitions that are open until 15 December 2011. The competitions were launched with funding from the Department for International Development (DFID) and the Danish International Development Agency (DANIDA). The fund manager of the AECF is KPMG Development Advisory Services.
SUMMARY OF NEW COMPETITIONS
1. Renewable Energy and Adaptation to Climate Technologies Window Round 2 (REACT R2)
The REACT R2 competition will support business ideas in renewable energy, adaptation to climate technologies, and applications from financial institutions that wish to expand their lending in these areas. There is no restriction on where the applicant company is from, only that the projects must be implemented in one or more of the 5 countries in the East African Community. Applications related to adaptation to climate change technologies are particularly welcome in this round.
2. AECF Agribusiness Africa Window (AECF AAW)
The Agribusiness Africa Window is a competition open to agribusiness ideas (broadly defined) from across the continent of Africa. It will support business ideas across the whole agricultural value chain (production, processing, input supplies, logistics, etc) as well as rural finance, information and other service sectors associated with agribusiness and rural enterprise. AECF AAW will co-fund successful applicants with grants and repayable grants of between US$250,000 to US$1.5 million. Special consideration will be given to projects implemented in DFID focus countries.
3. AECF South Sudan Window (AECF SSW)
The South Sudan Window will support business ideas in agribusiness, associated service sectors and value chains which extend from the Republic of South Sudan to local and international markets. The criterion on project size has been adjusted to US$100,000 minimum and US$1.5 million maximum to attract more small and medium sized businesses.
FREQUENTLY ASKED QUESTIONS
What is the AECF?
The AECF is a US$120 million private sector fund, backed by some of the biggest names in development finance and hosted by the Alliance for a Green Revolution in Africa (AGRA). Since its inception in June 2008, the AECF has grown from strength to strength. To date the AECF has run 11 funding rounds and are now managing 52 projects, with an additional 32 projects approved for funding. What started out as a US$36 million fund is now at US$120 million and still growing!
How does my business apply?
From the AECF website (www.aecfafrica.org), you need to download the application form and submit it to the AECF before the deadline – it is easy to complete and only requires an outline description of your company and your project.
How are successful proposals selected?
All proposals submitted will be screened and the best will be shortlisted and forwarded to the AECF’s independent Investment Committee. Commercially viable proposals that are considered to have the greatest positive impact on the rural poor in Africa will be invited to present a detailed business plan. The final selection of business ideas will then be made.
Does my company have to contribute?
Yes. Your company must provide matching funds equal to, or greater than, 50% of the total cost of the project. The AECF aims to leverage its funds and applications from companies providing a greater percentage of the funds for the project from their own resources will be treated more favourably, all other things being equal. Similarly, those projects with a greater repayable grant percentage will have a greater chance of winning.