Magazine article International Trade Forum

International Matchmaking and Business Partnering. (Exporting Better)

Magazine article International Trade Forum

International Matchmaking and Business Partnering. (Exporting Better)

Article excerpt

In recent decades, industrialized countries have developed a number of direct instruments to help their national companies become active in the developing world.

In matchmaking and similar business-partnering programmes, the sponsoring organization generally provides technical or financial assistance to private-sector partners in order to foster cooperation and help the companies to develop a profitable relationship.

What kind of matchmaking?

Many linkage programmes directly encourage European companies to invest in developing countries, including LDCs such as Bangladesh, Mozambique, United Republic of Tanzania and Uganda.

Most of the matchmaking and partnering programmes are aimed at small and medium-sized enterprises (SMEs) in the industrialized and developing countries. Experience in rich as well as poor countries shows that the potential of SMEs to have a substantial impact on the development process is much greater than that of micro-enterprises.

Some examples

Some of the more developed programmes sponsored by European countries include:

* the Programme for Cooperation with Emerging Markets (PSOM -- Programma Samenwerking Opkomende Markten) run by Senter International, an independent agency of the Netherlands Ministry of Economic Affairs under sponsorship of the Netherlands aid ministry;

* the Public-Private Partnership (PPP) project run by the German technical cooperation agency, GTZ (Gesellschaft fur Technische Zusammenarbeit);

* the Matchmaking Programme of the Norwegian aid agency, NORAD; and

* the DANIDA Private Sector Development (PSD) programme of the Danish aid agency.

All of these programmes are relatively new. PSOM started in 1997 in China, Egypt, India and South Africa, but activities in LDCs began only in 1999. PPP was set up in 1999, though it has expanded rapidly, matching more than 100 projects to date. NORAD's Matchmaking Programme, which started in 1995, has focused on only two countries until now, South Africa and Sri Lanka, though NORAD is considering expanding to others soon. The DANIDA programme has existed since 1995 and currently supports cooperation between Danish firms and companies in 11 countries, including Bangladesh, Mozambique, Nepal and Uganda.

NORAD -- a focused approach

Norwegian companies which are looking for a partner in a developing country submit a profile to the coordinating centre in Norway, which reviews it and sends it to a corresponding centre in the host country. When a match is found, NORAD can back the Norwegian company with up to US$ 2,290 as a grant for the first trip. If the parties agree to develop their relationship further, they can apply to NORAD for various types of industrial and commercial support. Developing country companies can also initiate the process.

In Sri Lanka, for example, the programme has received 120 profiles from Norwegian companies since 1995. Of these, 104 matches were found, 78 of the companies made visits to Sri Lanka and 22 have carried out preliminary studies. In all, 16 companies have signed cooperative agreements and 12 joint ventures have been formed. NORAD has also been contacted directly by 96 Sri Lankan companies. The collaboration encompasses diverse branches including boatbuilding, furniture and mattress production, fishing, data processing and environmental inspections.

GTZ -- rapid expansion

The German Public-Private Partnership is aimed at companies that would not, on their own, have the resources to find appropriate partners abroad. The PPP steps in with support when their projects are considered worthwhile from a development perspective, and financial assistance can support the sustainability of the ventures.

PPP projects are planned, financed and implemented jointly. There are no pre-qualifications by country or sector. The companies submit their proposals directly to GTZ and go through a six-step feedback and approval process. …

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