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MENA-OECD Enterprise Financing

Network

“Providing Linkages for Growth”
Dr. Alexander Böhmer, Executive Programme Manager,
MENA-OECD Investment Programme
Tel: +33 1 45 24 1912
Fax: +33 1 44 30 6135
alexander.boehmer@oecd.org
www.oecd.org/mena/investment

MENA-OECD Investment Programme

regional and domestic – as driving force for economic growth and employment throughout the MENA region. • It facilitates policy dialogue and sharing of experience on investment policies among policy makers from MENA countries and their OECD counterparts. “Mobilise private investment – foreign. initiated and led by countries in the Middle East and North Africa (MENA).MENA-OECD Investment Programme • The MENA-OECD Investment Programme is a regional effort. • It promotes broad reforms to enhance the investment climate and sustainable economic growth throughout the MENA region.” MENA-OECD Investment Programme .

financiers and government regulators – Providing avenues for private sector participants to effectively input into key investment policy reforms relevant to financing of entrepreneurship MENA-OECD Investment Programme .MENA-OECD Enterprise Financing Network • The MENA-OECD Enterprise Financing Network aims to improve the regulatory conditions for financing entrepreneurship using the MENA-OECD Investment Programme as a forum for exchange of good practice between MENA and OECD business and government representatives • The Network aims to foster entrepreneurship in the region by: – Creating a platform to connect entrepreneurs.

MENA-OECD Enterprise Financing Network • The Network is wide: 18 MENA countries and OECD member countries are supporting the MENA-OECD Investment Programme • The Network is deep: it provides a business and policy network for actors including: – – – – – – – – Private Equity Venture Capital Business Angels Associations Business Incubators Entrepreneurs Government regulators (MENA and OECD countries) Investment Promotion Agencies (MENA). MENA-OECD Investment Programme .

Actions going forward • Continue enlarging the Enterprise Financing Network • Develop recommendations and action plans to address innovative technology and regulatory issues • Launch a report to determine the enterprise financing gap in the MENA region • Develop a blueprint for enterprise funds why? To support efforts of MENA entrepreneurs to effectively participate in development of their economies MENA-OECD Investment Programme .

Jordan 14 February 2006 Sustaining efforts towards modernisation of financial systems to meet the challenge of employment creation and technological advance by 1. “developing effective frameworks and policies for entrepreneurship. MENA-OECD Investment Programme .Ministerial Declaration. including the promotion of women’s entrepreneurship”. “broadening the range of financial services and products that are available and aligning supervisory practices with global standards”. And by: 2.

etc. direct equity participations in local investment funds. Israel. or even in local companies.) to address the issue • EIB co-investing via specialised local intermediaries. IFC-PEP MENA Programme. Fondation Bank Populaire of Morocco and Bank of Cairo in Egypt began to outsource this customers segment set up microfinance departments within the bank. • Enterprise Financing Network which aims to close the financing gap by studying the exact demands for financing in each country and gather entrepreneurs and financiers MENA-OECD Investment Programme .Existing Models to Close the Financing Gap Selected Regional examples • Public guarantee instruments: introduced in Egypt. Lebanon. Morocco and Tunisia in cooperation with their banking sectors • SME banks: Banque de Financement de Petites and Moyennes Enteprises (BFPME) created in 2005 in Tunisia to provide loans to local SMEs. a law regulating the venture capital sector was introduced in 2006 in order to provide incentives for funds to invest in SMEs • • International initiatives A number of regional initiatives established (EU Working Party on access to finance for SMEs. Venture capital initiatives: In Morocco. Jordan.

sector.Gap Study: Context and Content • • • • • Extent of the financing gap in the MENA region is unknown due to data limitations EFN to undertake quantitative study on financing gap in MENA region Financing instruments to be considered Obstacles in the regulatory environment in relation to creation of start up financing mechanisms and in general conditions for entrepreneurship will be highlighted. etc.) per country MENA-OECD Investment Programme . Outcome: quantification of gaps (stage.

business angels and science and technology associations. entrepreneurs. venture capital. capital markets. fixed income instruments.). and other actors in the entrepreneurship value chain in order to bridge the financing gap. MENA-OECD Investment Programme . • Improve the collection and disseminate data related to enterprise financing through various instruments (bank credit. namely venture capital and private equity. • Establish linkages between financiers.Recommendations General • Address the shared responsibility for public and private sectors and facilitate information exchange between government action and private sector initiatives on innovative entrepreneurship and enhancement of financing conditions. etc. private equity.

particularly in knowledge intensive industries.Recommendations Governments • Provide support to governments in the MENA region wishing to develop instruments to bridge specific gaps to innovative enterprises. Encourage governments to further develop the fixed income instruments market in order to facilitate corporate borrowing. finance guarantee programmes. • MENA-OECD Investment Programme . • Encourage governments to consider supporting SMEs with fiscal and non-fiscal incentive schemes. and equity participation and other financing instruments. • Encourage governments to further develop capital markets in order to facilitate Initial Public Offerings and securities issuance.

• Encourage governments to evaluate their insolvency frameworks in order to facilitate corporate borrowing as well as issuance of debt and equity instruments. • Review the legal framework with respect to innovation and financing.Recommendations • Recommend the establishment of private and public credit bureaus in order to establish credit history and thus facilitate borrowing. in particular takeover and joint venture legislation and regulation of intellectual property with a view to facilitate domestic and foreign investment in the financial industry. MENA-OECD Investment Programme .

• Provide training to entrepreneurs on how to formulate business plans and present their activities to potential financiers. • Foster linkages between universities. R&D centers. business incubators and entrepreneurs. • Develop a blueprint for successful enterprise funds drawing on best practice from MENA and OECD countries. • Support the establishment and use of business incubators in order to assist the commercialisation of early-stage enterprises. • Consider the specific difficulties in obtaining financing which may be faced by women entrepreneurs in the MENA region. science and technology parks. MENA-OECD Investment Programme .Recommendations Private sector/incubators • Make efforts to increase the entrepreneurs’ awareness of financing tools available to them.

Recommendations Enterprise Financing Network • Support analysis undertaking by the MENA-OECD Enterprise Financing Network on how to address the financing gap/innovation challenges in the MENA region. education and professional training and provide advice on the regulatory environment and the development of financing instruments MENA-OECD Investment Programme . • Participate and support the Enterprise Financing Network as a key initiative to reduce the financing gap in the Middle East and North Africa region. • Encourage the establishment of a regional institute for entrepreneurial finance to conduct research. • Survey framework conditions relating to the operation of private equity and venture capital in the MENA countries and develop recommendations.

Network Access If you are interested in learning more about the MENA-OECD Enterprise Financing Network.org.boehmer@oecd. MENA-OECD Investment Programme . please contact alexander.