Côte d’Ivoire, like many countries all over the world, is facing the difficult issue of how to create jobs for the country’s young population. Already in 2008, Côte d’Ivoire had more than four million unemployed youth (the total population is estimated to be 21 million). At that time, the unemployment rate was 24.2% among 15-24 year olds, and 17.5% among 25-35 year olds. This situation has been greatly exacerbated by the post-election crisis of 2010-11.
Without access to employment and excluded from credit with which to finance income-generating activities, young people have essentially been left on their own. There is a need for urgent action to equip the country’s youth with the means to develop their entrepreneurial potential. Adequate training that matches the demand of the private sector, and access to funding, are both needed to help integrate young people into private companies or to create and manage their own micro-enterprises. Côte d’Ivoire has many young graduates who have come through the basic education system and undergone vocational training. Providing this segment of the population with access to decent and sustainable jobs is a key priority for the government, and one of the biggest challenges to achieving President Alassane Ouattara’s aim of making Côte d’Ivoire an emerging economy by the year 2020.
In this context, the United Nations Industrial Development Organization (UNIDO) has created a support mechanism to help integrate young people into the job market. Taking into account the limited absorptive capacities of the public sector and the formal labour markets, youth entrepreneurship is a viable option to create employment. Entrepreneurship and sustainable businesses generate economic growth and jobs for young women and men, as well as stimulating structural change and innovation.
One of the major obstacles for successful youth entrepreneurship creation and expansion is the missing link between financial and non-financial services. Entrepreneurial and technical training must be combined with adequate financial services in order to deliver the full potential in terms of results. However, available financial services are often not sufficiently accessible to youth, who are perceived as a high credit risk due to their lack of collateral, limited experience and young age.
UNIDO’s La Chaîne de l’Emploi (The Employment Chain) therefore combines vocational and entrepreneurship training with access to funding in order to create income-generating activities. The skills acquired enable young people to engage in specific occupations and to find work in private companies through internships and training programmes.
As part of this approach, a support fund for youth entrepreneurship has been established to provide access to finance for micro-projects with high value added. UNIDO, with funding from the government of Austria, and local Ivoirian partners, including the Ministry of Industry, the Ministry of Crafts and SME Promotion, the Ministry of Youth, and the Chamber of Commerce and Industry of Côte d’Ivoire, have established Le Fonds d’Appui ? l’Entreprenariat des Jeunes (Youth Business Fund). The Fund will grant repayable loans to aspiring young entrepreneurs, aged between 16 and 35, to help them establish their micro-projects, while providing them with the necessary entrepreneurship training, technical assistance and coaching, over a period of 14 months.
The specific objectives of the Fund are to issue a call for project proposals, select the projects with the most innovative projects with the greatest market and employment-generating potential, train the project-holders in accounting and business administration, and then award loans to the most viable projects. The most promising projects receive support and monitoring, and once they become self-reliant and profitable they will repay their loans, in order to keep the Fund revolving.
In the first stage, 150 project ideas were selected out of almost 900 submitted to the Fund. Eligible projects include those focusing on craft production, the production of intermediate and finished products, food processing, and communications. In May 2012, the promoters of these 150 projects began their training programme. On completion of the programme, the best 100 – a selection based on the potential profitability of the project and the market demand for its services – will receive a loan of up to a maximum sum of €7,500.
UNIDO’s role in the running of the Fund essentially focuses on the provision of non-financial support services. In close cooperation with business support institutions, such as the Chamber of Commerce, the aim is to provide young, potential and existing entrepreneurs with entrepreneurship training, counselling during the start-up and expansion phase, and the technical assistance needed to successfully create or develop their businesses. Once the pilot round of the Youth Business Fund has yielded its first tangible results, UNIDO intends to replicate the programme throughout Côte d’Ivoire.
Making It talks to four potential beneficiaries
SERGE ANDERSON DJI TCHESSOGOHO, 29.
“I trained as an electro-mechanical engineer. My project is a small business, recycling plastic, and then using the plastic, combined with sand, to manufacture surfacing/ paving. This type of paving is exceptionally durable and offers a sustainable alternative for the paving of roads. In addition, it is an ecological project since it recycles plastic waste. This project will initially create five jobs and will give young entrepreneurs a foothold in the economy.”
CHRISTIAN KROU, 23.
“I pursued a graduate studies course in industrial maintenance. My project is in the field of agribusiness, and consists of the transformation of food products and seasonal fruits into semi-finished products (juice, syrup, jam, biscuits).
This project will solve the problem of preserving food and, at the same time, will offer consumers food products with a high vitamin intake. This project will at first create around five jobs.”
DJENEBA KONE, 32.
“My project is located in agro-industry and consists of setting up a small processing unit to create raw shea butter lotion and ointment for skincare, and processing peanuts to produce peanut butter for households and restaurants. This project will take advantage of the shea value chain and will initially create around four jobs.”
SITA ELINE ATTOUKORA, 31.
“Previously, I worked as a secretary. My project involves the production of poultry feed from local produce, such as shellfish, corn, and fish waste, to which vitamins will be added. This project supports poultry production and the processing of food products into local by-products. At the start, this project will create around four jobs.”
Doris Hribernigg is the UNIDO Representative in Côte d’Ivoire. For further information, contact the UNIDO office in Côte d’Ivoire: of****************@un***.org
This blog was first published on Making It Magazine and is reproduced with permission.
One Response
Manuel Mattiat, International Programme Expert at the UNIDO Field Office in COTE D’IVOIRE, sends this update:
This is a pilot project and we are grateful for any suggestions, ideas and experiences so that we can refine the approach in subsequent phases.
The market element is essential for these micro-business projects. First of all, the market study for each suggested product is one of the most important selection criteria. A panel of finance and entrepreneurship experts, as well as local residents, assess very carefully what the value-added is of each project idea and if the submitted market studies are reliable. This filter element explains why we had selected 30 projects out of 1,000 candidatures in the first round and the biggest reason for this drop was the lack of a market behind most of the proposals.
We are working closely with local institutions such as the chamber of commerce or the “chambre des métiers” to help us determine the demand for specific products, and thus the feasibility of the proposals, and our partner microfinance institution makes equally rigid assessments of the demand-side before selection.
UNIDO conducted a study on the country’s growth sectors – particularly in the area of agro-industries – and their potential in terms of employment creation. This is another strategic basis for us to determine which business projects are most likely going to be feasible. As a result, we have a lot of projects in agro-processing to add value to local products.
In terms of the plastics recycling, we had a similar experience with a project in Guinea where plastic bags could be turned into pallets which companies bought for industrial use. This could be replicated here. Some partners, such as UNDP, have conducted studies on “green jobs”, and waste management clearly has a big employment creation potential in the whole sub-region.
With regards to assistance to structure distribution channels, the idea is to capitalize on some of UNIDO’s ongoing private sector development programmes. One, for instance, provides assistance to local SMEs to increase their competitiveness via the creation of export consortia and quality control mechanisms (testing laboratories to certify products etc). The idea is to allow local products to penetrate local, regional and international markets.
The current business fund projects are very small-scale but if they develop and expand, they should be able to benefit from some of the private sector development schemes that are in place, particularly in a view to maximize distribution.
We are in discussion with the Government, namely the Ministry of Industry, on incentive schemes. Currently, this concerns the area of technical and professional training (for companies absorbing apprentices or interns) and with regards to the development of specific sectors: if you want to develop growth sectors and create comparative advantage vis-à-vis other competitors, certain sectors could be protected, or incentives (tax, subsidies etc)could be given to local producers.
In the framework of the business fund, the idea is to bring these entrepreneurs from the informal to the formal sector and under the umbrella of preferential tax schemes. In return, they benefit from public services provided by the chamber of commerce or others and a certain protection so that the investment is worthwhile. But these discussions have to continue and be concretized once we have first tangible results in our pilot project.
Best regards,
Manuel Mattiat