$16M AusAid Grant for Deserving Mindanao Businesses

October 6th, 2007 --

A$16 million(Australian Dollars) from the Enterprise Challenge Fund (ECF) was set aside by the Australian government’s AusAid for the Philippines to be given to deserving businesses with viable business plans operating in Mindanao.

Other countries which were able to receive ECF funding were Fiji, Papua New Guinea, and Indonesia.

John Hardin, ECF Fund Director for Pacific and South East Asia said that only businesses implemented in Mindanao will be considered for the fund set aside for the Philippines. There is no discrimination against businesses owners in Luzon and Visayas because he said that those companies can still access the grant as long as their project is in Mindanao.

But he however highlighted that the fund is just as difficult as as getting a bank loan when applying for the grant. In the primer distributed during the Marco Polo Davao presscon last Thursday, it stated that business projects that create commercial opportunities in low income markets can apply for grants between A$100,000 to A$1.5 million from the ECF.

It looks like the funding works on the counterpart principle, where the business will put up 50% of the project cost and ECF the remaining 50%, as Hardin said that 50 percent counterpart would not necessarily be in cash as it could either be a sweat equity or an executive time or other related services. The good news however is that the 50% counterpart put up by the business need not necessarily be in cash.

He said the ECF is a new innovative opportunity for businesses to develop a commercially sustainable business enterprise and could provide benefits to the poor and help improve their living standards. Hardin said they have strong interest in Mindanao even as he said that there is a strong growth of businesses in the island.

The ECF is an open competition that will have several bidding rounds in each country. An Assessment Panel comprised chiefly of private sector representatives, will select the winning proposals.

The ECF funding bidders must complete a two-stage application process including a submission of a brief Concept Note, and, if invited by the Assessment Panel, a Full Application Form.

After applications have been reviewed by the panel grants will be awarded to projects that best satisfy the assessment criteria. A contract will be developed with the successful bidders and the grant money will be provided according to the expenditure and reporting timetables stipulated in the contract.

There will be two bidding rounds per year in the first three years.

Hardin said the projects must meet the criteria. He clarified the program does not provide technical support.

He said they make use of the grant to address external obstacle that could block their operation and eventually make the project successful at the same time provide and sustain benefits to the people through jobs created.

Sam Zappia, Counsellor Development Cooperation of the Australian Government said they prioritize Mindanao in the Philippines because it is in the island where the bulk of the poor lives. He said it is in Mindanao where potentials are highly untapped.

It is believed that better business activities in the area could help the poor aside from the fact that the Philippines is important to Australia.

Mofe Ogisi, project manager of Coffey International Development, specialists in developing communities said it is through the private sector that ECF will partner, the former being an engine to economic growth.

ECF starts accepting concept notes until December 31, 2007 through on line at www.enterprisechallengefund.org and Jason Magnaye, ECF country manager will go around Mindanao to campaign among businesses to avail of the grant.

Magnaye said Mindanao being an agri-business island will most likely have projects under that sector and that he is optimistic that businesses here could be considered in the first round.

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