The Choose Africa initiative was launched in Dakar on march 29, 2019 and aims at speeding up SME growth, VSE and start ups in Africa. This French Development Agency (FDA) project shall provide them with a whole lot of tools to fund them and better assist them in their development. Therefore, an envelope with 2.5 billion of euros will be dedicated to supporting african entrepreneurs by 2022.
The French Development Agency (FDA) plan on supporting and endorsing start ups, African VSE and SME but also indirectly support the financial institutions established in the continent throughout its subsidiary Propacor which is dedicated to the private sector. In order to make that happen, the agency launched on March 29, 2019 at the Chamber of trade in Dakar the Choose Africa initiative which has the ambition to finance and support the development of those businesses. The goal behind it? to support a total of 10.000 companies , from which 600 are stake helds, priority given to small african establishments. Paris has released 2.5 billion of euros as loans to invest in businesses, from now on until 2022.
This help will be provided throughout the different steps of the development thanks to fundings necessary to meet with the needs of the entrepreneurs (own funding and tools to help getting loans), but also technical endorsement to train businesses on environmental or social practises like for example ways to develop a favorable ecosystem for entrepreneurship. There will be a full monitoring of the whole process.
A reassertion of the French commitment
The fact that the French Minister of Finances Bruno Le Maire was present at the Choose Africa launching reaffirms the commitment of France to support the sustainable development of Africa. On November 2017, the president of the republic of France had already proven its willingness to support the continent by giving 1 billion of euros from its own funds to African startups, VSE and SME in Ouagadougou. The French government has been relying on the FDA on the last 40 years to maintain this commitment and endorse entrepreneurial revolution and innovation in Africa.
Entrepreneurial revolution and innovation
Indeed, more than 450 millions of young people will enter the job market in Africa by 2050. Which in other words represent an opportunity for the growth of the continent but also a challenge both for the African countries and the world. Africa is the continent of entrepreneurship. It has the highest rate of entrepreneurs. Startups and SME will definitely play a key role in catching the attention of a job seeking youth: those structures create a lot of jobs (60% formal jobs and represent 90% of formal businesses) and play a decisive role in creation, economic growth and innovation.
However, until now the lack of funding has been an obstacle and has slowed down local entrepreneurs prospects by restraining their potential. For example, at the moment only 20% of the SME have had bank loans and 87% of start-ups haven’t had any funding. Knowing that it is essential to offer fundings and appropriate help to bring change and make those obstacles disappear for the sake of development. Something that Choose Africa plans on handling very soon.