East Africa: Competition Opens to Promote Business Innovation
By Henry Neondo
NAIROBI---The Africa Enterprise Challenge Fund (AECF) Wednesday announced the results of the first round of a competition to promote business innovation in the East African Community. The competition to be known as the renewable energy and adaptation to climate change (REACT) is open to investments in the EAC, which includes Kenya.
No less than 11 EAC based companies will receive approximately US$ 9.2 m from the AECF in the form of grants and interest free loans for their investments in Kenya, Uganda and Rwanda.
The REACT is a competition, open only to for-profit companies.
The objective is to stimulate private sector entrepreneurs in Kenya to innovate and find profitable ways of reaching and benefitting the rural poor with their products and services. The AECF provides financial support between US$ 250,000 and US$ 1,5m to the best business ideas.The AECF REACT window is funded by the UK Department for International Development (DFID) and the Danish Government.
The first round of the AECF REACT window was launched by Prime Minister Raila Odinga on 1 November 2010. In total, 1102 companies registered for REACT East Africa. Of these, 348 companies submitted fully eligible applications.
The best 33 business ideas were selected and requested to prepare and submit business plans. Thereafter, the AECF’s independent Investment Committee met in Dar es Salaam and Nairobi from 19 to 27 September 2011 to adjudicate the winning bids.
All finalists were given the opportunity to present their business plans in person to the
Investment Committee.
In addition to 8 approved REACT projects in Tanzania last week, the Investment Committee today selected a further 11 business ideas for funding under REACT EAC.
The AECF funds are expected to leverage at least two times this amount from the companies’ contributions to their own projects.
The business ideas include power generation from renewable energy, adaptation to climate technologies projects, alternatives to charcoal cooking, biogas and micro-finance for access to renewable energy.
The AECF expects that over 2 million entrepreneurs, subcontractors, employees and clients in the EAC will benefit from these projects over the next four to six years.