Helping Jordanians and refugees to start their business

Truvalu co-founded a new program in Jordan to help refugees and Jordanians to start a successful business. The Arab country that is heavily affected by the Syria crisis, is home to entrepreneurs ‘who have a lot of potential’, says program manager Hala Imam.

Jordan, that borders conflict-torn Iraq and Syria, is considered one the safest countries in the region. Despite this reputation, it has some problems of its own. The country is one of the most affected by the Syria crisis. Jordan now has 89 refugees per 1,000 inhabitants, the second highest share of refugees compared to its population in the world, according the UNHCR.

The Government of Jordan is opening formal employment opportunities for refugees, but this is not easy in a country with an unemployment rate of 18.5 percent in the host community.
Truvalu, Kerk in Actie, ICCO and implementing partner DSPR therefore started a program in Jordan on business recovery.

Jordan Hala Imam

“Before Syrian and other refugees fled to Jordan, many had a business at home”, says program manager Hala Imam, speaking from capital Amman. “The idea is to help them restart, and at the same time create employment and economic development for host Jordanian entrepreneurs.” Jordan not only hosts many refugees, but also has an increasingly young population between the age of 18 and 40. “All of them are looking for job opportunities. We have a lot of potential in this country”, says Imam.

From lunch delivery to strengthening women’s skills

Six successful applicants joined the first program that started in March. Last month, they finalised the business boot camp where their entrepreneurial skills were tested and strengthened. In addition, they received 25.000 euro each to start up their business: a loan that they pay back according to their quarterly revenue.

Mowafaq Hashem is one of them. The Syrian participants started Safartas, a lunch delivery service that works through online subscription. Hashem delivers main dishes, appetizers, salads and desserts to Jordanian employees and to university students. Eventually, he aims to expand his business to deliver meals to working families who do not have time to cook everyday.

Lara Shahin, another Syrian candidate, launched a business of handmade products with natural ingredients. Shanin aims to train 200 women to work on producing local soap, among others.

The Jordanian couple Nada Hanieh and Saeed Omar also work on training women. They launched SitatByoot several years ago already, an online recruitment and training website that helps women at home to train their skills. At the same time, they help employers and corporate buyers to connect to sit-at home women who can’t go out to work, but who would like to provide their services and make products for them at home.

“All entrepreneurs should hire 50% refugees, and 50% Jordanians”, says program manager Hala Imam. “With this we want to stimulate economic development and local employment.”

The first program in Jordan is a test case for what the organisations hope to become a entrepreneurial training program that restarts in Amman every quarter. Hala Imam: “We wanted to start small to study the market and see how the response is. But over the past weeks, we received a bombardment of calls, and we now have over 100 applicants who want to join our next program.” As far as Imam is concerned, the program will continue for the years to come. “We have already secured funding for the second round”, she says.

New study challenges funds and governments to invest in African agrifood SMEs

Rabobank Foundation, AgriProFocus, Food & Business Knowledge Platform and ICCO Cooperation recently published the study ‘Critical Capital for African Agrifood SMEs’.

The study evaluates the access of risk capital by agrifood SMEs (small and medium enterprises). SMEs are key for establishing sustainable food systems, while at the same time face difficulties to access capital.

Offer agrifood SMEs an assortment of services

The study focuses on agrifood SMEs that form the ‘missing middle’: too large for micro-finance and too small for mainstream banks and private equity firms. A major conclusion is that there are very few investment funds that meet the financing needs of agrifood SMEs; the need for funding is usually under 250,000 USD, whereas most funds start investing from 1M USD. Such smaller investments are tedious and costly for investment funds, even for those set up with the explicit goal to stimulate the development of the agrifood sector.
The report therefore calls on policy makers to promote a graduation strategy, that allows investors to offer an assortment of services to agrifood SMEs that match their development stage. Governments and international development agencies can contribute to such a strategy by reorganising their own investment vehicles; giving them a wider mandate and access to relevant – low cost – financial resources to invest in the missing middle.

Importance of agrifood SMEs for food security

In 2050 the number of people living in Africa will have doubled. This entails enormous challenges for food supply. However, Africa is capable of feeding itself as their is enough availability of natural resources. It can even become a global player in the agrifood sector. And SMEs play a key role in this, because they occupy critical positions along the value chains: as input suppliers, off-takers, processors, distributors or otherwise. They constitute a pull factor, aggregating smallholder farmers into the value chain and upgrading the quality and efficiency of farming, leading to a more sustainable food system.

About the research

Apart from desk research, the study involved field research in four countries (Kenya, Tanzania, Zambia and Mali). Local researchers interviewed investment funds, agrifood SMEs, and relevant resource persons. This resulted in examples of successful SMEs that had raised capital, thereby boosting their development, and of SMEs that could not access such funds. The study also presents an overview of existing investment funds for agrifood SMEs in Africa.

The study has been carried out by Bert van Manen, researcher at Fair & Sustainable Consulting.