On Tuesday, 23 August, the Netherlands Enterprise Agency and Kilihortex Holding BV signed an agreement with the Rabobank to finance the expansion of a raspberry nursery in Tanzania. It is a co-financing scheme between the Rabobank and the Dutch Good Growth Fund, or DGGF. They are both providing the company with a loan and a guarantee. It involves a total expansion of about 45 hectares of agricultural land and an increase in cooling capacity.
Unusual cooperation
What is unusual about this cooperation is that it is the first time DGGF has granted Technical Assistance, TA, to an entrepreneur. By doing so, DGGF minimises the financial risks of the investment. The fund also offers assistance to help mitigate risks within the framework of International Corporate Social Responsibility, or ICSR.
FruitWorld Breda is joint owner of raspberry nursery Kilihortex in Tanzania. Social responsibility is important here. For example, doctor fees are paid for permanent employees. Monthly open evenings are held on HIV, AIDS and family planning, and employees get one month paid leave per year.
Corporate responsibility
ICSR means entrepreneurship with one eye on the company and one on the impact of its activities on people and the environment. This involves things such as education of employees, good working conditions, health care and environmental awareness.
Permanent employment
DGGF Investment Manager Renée Beerepoot: “This investment will create significant permanent employment in the horticulture sector in the Moshi region. We are talking about 200 FTE new permanent employees and 300 FTE temporary employees during picking season.”
The co-financing with DGGF means customers can be even better served for the Rabobank. “Our Rabo International Desk Africa already does much for customers. By co-financing with DGGF, risks are divided and we can mean even more for customers in developing countries,” says Erik Pullen, account manager for the Rabobank.
The Dutch Growth Fund of the Netherlands Enterprise Agency (RVO in Dutch) helps Dutch SMEs who do business with developing countries and emerging markets. DGGF grants financing and insurances in order to make trade and investments relevant to development possible in 68 countries. It is a co-financing scheme for situations in which other financing arrangements on the market are not or not sufficiently usable.
The Netherlands Enterprise Agency carries out DGGF under the authority of the Ministry of Foreign Affairs.