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Micro Joint Ventures Annual Report 2012

Micro Joint Ventures Annual Report 2012

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Published by Michael Russell

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Published by: Michael Russell on Jun 28, 2012
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06/28/2012

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MicroJointVentures
Annual
Report2012OverviewTheyearjustgone(May12011-April302012)hasbeenanimportantoneforMicroJointVentures.WehaveforgednumerousnewrelationshipsandjointventureswithBurundianchurches.SinceMay1lastyear,wehaveexpandedfromtwojointventureprojectswithtwochurchestosevenprojectswithsixchurches.WealsoexpandedanexistingprojectinMay2012.AfurtherprojectisclosetocommencementasIwritethis.Inaddition,weappointedanewBurundianNationalDirector,andincreasedourProjectsUnderrvlanagementfrom$1322to$10688.OurworknowcoversasubstantialportionofthecountryofBurundi,withthemajorityofchurchesbeingrural,totheeastandsouthofthecountry,allthewaytotheTanzanianborder.OurworkiscurrentlyentirelyfocussedinBurundi,howeverintimewehopetomovetootherpoorcountries.Ihaveselectedafewhighlightsbelow.NewNationalDirectorDuringtheyear,eventsespeciallywithintheBikobeParishmadeitclearthatsomehelponthegroundinBurundiwouldbeuseful.WehadgivenBikobeParishaheftysumof$5000,rewardingthemforthesuccessoftheirBrickKilnbusiness(whichreturnedmorethan100%initsfirstyear).ThismeantthattheyhadalargeproportionofMicroJointVenturesfunds,andtheperformanceofthisprojectwasparticularlyimportant.Theycommencedwiththeproposal.ofaPharmacy,thenfoundthatakeystaffmembertookajobelsewhere.Mermuchdeliberation,theychangedthebusinesstoaGrainGrindingBusiness.ThenthepricefortheGrinderbecameoutofreachwhentheBurundianfrancdepreciatedagainstothercurrencies.Sotheyswitchedfinallytoalivestockandfoodbusiness.ThebigissuewasthatIwasonlyinformedofthedelaysandproblemswiththeGrainGrinderuntil9monthsafterthemoneywasfirstgiven.Sowehad9monthswherenothingwasachievedwith$5000capital,andthecommunicationaboutthiswaspoor.ThisledmetoappointanindigenousBurundian,AimeJosephKimararungu,tooverseetheoperationsinBurundi.IfirstcameintocontactwithAimeJosephthroughamannamedDesireNibigira,acontactattheAnglicanParishofRuyigi.HementionedthatAimeJosephhadbeenthePrincipalofanAnglicanBibleCollegeinBurundi,andhadwona.scholarshiptocontinuehisstudiesinAmerica.
It
turnedoutthattheTheologicalCollegeinquestionwasveryliberal,tothepointofhavinganactivehomosexuallecturer,livingwith-partneronsite.AimeJosephdecidedhecouldnotstaythere,andImanagedtoaidinraisingmoneyforhimtotransfertoBishopBarhamCollege,anevangelicaltrainingcollegeinUganda.Heofferedtoassistintheadministrationofourprojects,andIacceptedhisoffer,installinghimasBurundianNationalDirectorofMicroJointVentures.TopayforAimeJoseph'swork,Ihavenotonlysenthimtheentiretyofthemoneyduefordeductions(seebelow),butalsochang.edthestandingarrangemehtsforanynewprojects.Forallnewprojects,itmustbeagreedthat50%ofthedividendswillgotous,45%tothe[ointventurechurch,andS%toAimeJoseph'schurch,topayforAimeJoseph'swork.ThisarrangementisalreadyinplaceforBikobe'sfoodbusiness,forGitega'sBrickKilnandfarmingbusiness,andforRuyigi'shoneybusiness.
 
PerformanceoftheProjects
OurBrickKilnproject,whichperformedsowelllastyear,hadamajorsetbackthisyear.1500000worthofbricksweresoldtoonebuyer,whodidnotpay.Thisis150%oftheentireinitialinvestmentinthebusiness,soitisaverybigdealforthisbusiness.Legalproceedingsareunderway.TheBikobeParisharehopefulofrecoupingatleastsomeofthefunds.HerewehaveoneofthedifficultiesofrunningabusinessinaplacealikeBurundi.Ontheupside,brickshavebeenproducedandsold,sothechurchhascontributedtothecommunity.PerhapstheinjusticewillbringgoodwillintheareatowardthechurchandthenameofJesus.TurningtothefoodbusinessatBikobe,itisencouragingthatintwomonthsofoperation,theprofitwasover800000francs,whichisareturnofaround100%p.a.onthecapitalinvested.ThisisagoodrecoverybytheParishofBikobe,afterthedelayofninemonthsinachievinganythingwiththeirlargeamountofcapital.Amongtheotherbusinesses,thehoneybusinessatRuyigiParish,andtheFoodKioskatrvtJroreParishproducedreasonabl'ereturnsof26%and24%respectively.However,suchreturnsarebelowthecostofcapitalasIseeit.
My
viewisthatParishesneedtobereturningaround40%p.a.tobeproducingreturnsinlinewiththeriskprofileofthearea.Oftheotherprojects,themostdisappointingwastheCassavaFlourbusinessrunbytheGasavaParish.Thereturnof4%reflectedapoorseason,strikesandinflation,aswellassomepooradministrationoftheproject.ThefundshavebeenredeployedatashopinBujumbura,wheremycontactAugustincankeepaclosereyeonthebusiness.Theremainingprojectsareallataveryearlystage-tooearlytohaveareturn.
Deductions:
Theaverageoflastyear'sandthisyear'sfundsundermanagementwas$6010.19,whichmeantthatthemaximumdeductionthisyeartopayforadministrationwas5%ofthisamount,or$300.51.(Therelevantrulescanbereadonourwebsite,onthepage,'Purposes,Principles,Rules')Thisyear,theadministrationdeductionwasusedtopayfortheworkofournewBurundiNationalDirector,AimeJoseph.Isent$280tohiminrv1arch(lessthanthemaximumdeductionallowed).Inthe2013year,themaximumallowabledeductionshouldbearounddoublethatamount,andIforeseemostorallofthatagaingoingtoAimeJoseph'swork.NotethatIreservetherighttobepaidmyselffortheworkIamdoing,outoftheyearlydeduction.However,atthisstage,Ihaveoptedtotakenopersonalpaymentforthework,sothatmorecangotohelpingtheAfricanchurches.NotealsothatIdidnotclaimanypaymentforsettingupthewebsite-Ipersonallypaidforthedomainnameandthesitemanagementfeeonwordpress.com.Again,Ireservetherighttoclaimtheseexpensesinthefuturefromtheyearlyadministrationdeductionof5%offundsundermanagement.
Audit:
Therehasbeennoexternalauditthisyear.Thecostsaretooprohibitive,giventhecurrentscaleofouroperation.GiventhatIhavepersonallytakennothingoutoftheworkthisyear,andcontributedmuchtimeandmoney,Itrustthatthisisdeemedappropriatebyourcontributors,andotherinterestedparties.
 
Conclusion:Whilenoteverythinghasgonewellinthelastyear,Iamencouragedbytheoveralldirection,andquiteconfidentthatthisyearwillseegoodreturnsforourbusinesses,astheymature.rvbreimportantly,IamconfidentthatourworkisstrengtheningthechurchesinBurundi,andbringingglorytoourLordJesus.lVlayheblesshischurchesinBurundiandbeyond!

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