Dutch Good Growth Fund: Business for development
Entrepreneurs with sound plans for doing business in and with emerging markets and developing countries are often confronted with banks that are unwilling to provide finance. This means missed opportunities for sustainable economic growth in the countries concerned – affecting all sections of the population – and for the Dutch economy.
The Dutch Good Growth Fund (DGGF) therefore supports Dutch SMEs and entrepreneurs in emerging markets and developing counties, by offering a source of financing for development-relevant local investments and exports. Applications can be submitted from 1 July 2014 for activities that create new local jobs, increase the production capacity of local industry, and contribute to the transfer of knowledge to the developing country concerned.
What financing needs are covered by the DGGF?
The DGGF can relieve entrepreneurs’ financing needs in the following cases:
- Investments by Dutch SMEs in emerging markets and developing countries. Dutch SMEs may apply for up to €10 million in funding if they plan to invest in emerging markets and developing countries but are unable to obtain financing from their own bank. The DGGF supplements private investments by means of guarantees and direct co-financing with a repayment obligation, such as loans and equity investments in projects.
- Finance for local SMEs in emerging markets and developing countries. The DGGF stimulates the provision of finance to companies in emerging markets and developing countries. The focus is on young entrepreneurs, female entrepreneurs and companies in fragile countries. The DGGF makes funds available for intermediary funds that are aimed at developing the SME financing segment of the market, thereby ensuring that SME financing opportunities in emerging markets and developing countries continue to grow. This should have a direct impact on the development of the financial sector in low- and middle-income countries. This part of the DGGF is managed by a consortium of PwC and Triple Jump. More information on the conditions will be available on www.rvo.nl/dggf from the first of July 2014.
- Finance for development-relevant exports from Dutch SMEs to emerging markets and developing countries. Dutch SMEs and their finance providers can obtain insurance coverage from Atradius Dutch State Business, for an amount up to €15 million (at a break-even premium), to cover the payment risk associated with the export of capital goods. Entrepreneurs may also be eligible for financing of up to €2 million for buyers in low- and middle-income countries who are unable to obtain financing from their own bank for the export transaction. The financing is provided on condition of repayment by the buyer. More information is available at www.atradiusdutchstatebusiness.nl.
The DGGF applies to 66 countries in emerging markets and developing countries in Africa, Asia, Latin America, and Central and Eastern Europe. An overview of the complete terms and conditions, as well as an overview of all DGGF countries, is available at www.rvo.nl/dggf. More information is available on the website of the Netherlands Enterprise Agency www.rvo.nl/dggf.