SNV launches Innovations Against Poverty programme in Ethiopia

SNV in Ethiopia has just launched the Innovations Against Poverty programme. On the launching event the Programme officially opened country level Call for Proposals and provided critical application guidance and inspiration.

SNV with funding from Sida (Swedish International Development Agency) and in partnership with Bottom of the Pyramid Innovation Center (BoP Inc.) and Inclusive Business Sweden is currently implementing a multicounty programme - Innovation Against Poverty.

IAP is a specialised programme developed to identify and support innovative Inclusive Business ideas be it in products, services, and business models that can contribute to the fight against poverty and climate change while generating commercial benefits.

Its aim is to simulate development which otherwise would not have taken place within the private sector to promote innovation and taking commercial risk, unleash the  market opportunities and accelerate the go-to-market process.

Ethiopia is a country where 23% of its population lives under the poverty line. The country is implementing various development activities to pull its people out of poverty focusing on light industries as the drivers of the economy integrating to the global value chain.

Dr. Mebratu Meles, State Minister of Industry, recognising the value of the implementation of projects that focus on alleviating poverty such as IAP, called on private businesses and partners working on private business development to tap into this opportunity to contribute their respective share in addressing innovatively the critical challenge of Ethiopia - poverty. IAP is very much aligned with GTP II focus on building strong private sector that can lead and significantly contribute to development objectives in the country.

“IAP is implemented in four countries. Hence, as one destination country of IAP, we need to come together to maximise the benefit so that we can contribute our share in addressing the challenges of unemployment especially among the youth and women” stressed Dr. Mebratu.

The program is designed to stimulate innovative businesses contributing to poverty reduction through private sectors which are operating in Ethiopia, Uganda, Zambia and Cambodia, and actively involved in Agriculture, Energy, ICT and, Water Sanitation and Hygiene sectors. IAP’s social impact focus is through employment creation, increased income and creating access to basic products and services.

As one of its components, the programme has a challenge fund for private companies with innovative and inclusive business ideas to increase their access to financial support ranging from €50.000 to €200.000, as a non-reimbursable risk capital for up to a maximum of 49% of the total required investment. The entrepreneurs’ investment must at least profile 25% in cash contribution.

Eldad Girma, Inclusive Business Advisor, SNV Ethiopia, said, “The project wants to partner with innovative inclusive businesses working in the low market segments facing high risk and transaction costs. Because of these perceived risks also where other financing mechanisms fail to partner with.”

Hence the call is encouraging entrepreneurs be determined to take the challenge and make the change.

The project manager, SNV, Javier Ayala advised participants to focus on “business ideas that will benefit low income people: globally recognised to live below USD 8 per day but this should be contextualized for each country’s  income level in Purchasing Power Party”.

To ensure that this potential businesses succeed, IAP provides also technical support through its team of advisors. For this purpose the programme trained 15 local consultants on inclusive innovations and inclusive business model development. These consultants are expert pools that potential investees can use during application and also project implementation on market fee bases paid by the private companies themselves. This is expected to develop the eco-system of professionalising business operations and investment in critical business planning.

More than 110 participants from the business community, business development service providers, and relevant government stakeholders participated in the launching event.