The United Nations Capital Development Fund (UNCDF), in partnership with Private Sector Foundation Uganda (PSFU) and Uganda Development Bank Limited (UDBL), and with support from the European Union, launches the Support to Agricultural Revitalization and Transformation (START) Facility.
The Facility is intended to offer access to affordable medium-term finance for agricultural value adding projects in Northern Uganda through provision of Business Development Services and seed capital in the form of concessional loans, grants and partial guarantees.
START is expected to contribute to increased food security, improved maternal and child nutrition, and enhanced household incomes as a key outcome of the Development Initiative for Northern Uganda (DINU). DINU is a Government of Uganda programme supported by the European Union for an amount of 132,8 Mio EUR (approximatively 603 billion UGX).
START geographic coverage is aligned with DINU geographic coverage, i.e. it comprises 33 districts in Northern Uganda as listed below:
Abim, Amudat, Kaabong, Kotido, Moroto, Nakapiripirit, Napak
Agago, Amuru, Gulu, Kitgum, Lamwo, Nwoya, Omoro, Pader
Alebtong, Amolatar, Apac, Dokolo, Kole, Lira, Otuke, Oyam
Adjumani, Arua, Koboko, Maracha, Moyo, Nebbi, Yumbe, Zombo
START will support development and financing of capital-intensive agricultural projects promoted by small and medium enterprises that add value in storage and processing of agricultural products. START will take into account the impact of the complementary activities for food production and commercial agriculture.
START addresses the “middle missing” gap in agricultural finance targeting projects with a financing requirement from 10,000 EUR (approximately UGX 40 million) to 100,000 EUR (approximately 4 billion UGX). It will closely cooperate and coordinate with other financing and technical facilities supporting agriculture in Uganda.
The facility aims to achieve three interconnected objectives:
- Offer access to affordable medium-term finance for agricultural value adding projects in Northern Uganda.
- Support projects that contribute to economic empowerment of women and youth.
- Encourage projects that aim at reducing environmental risks and ecological scarcities.
START is structured as a blended facility providing a customized mix of Business Development Services, project development & structuring services, and financial products. These three lines of business are managed by the three participating institutions PSFU, UNCDF and UDBL respectively.
START offers the following services and facilities to project developers:
- Business Development Services: Support in development of grant, concessional loan and partial guarantee applications, legal support, technical and management training.
- Project preparation, development and transaction services: Targeted technical project development and financing support to project developers (e.g. enhanced project documentation, due diligence and financial structuring); customized project financing structures and investment vehicles; preparation of project investment documents in the format acceptable to commercial banks and investors; provision of capital grants, credit enhancements/guarantees.
- Financial services: linking developers to financial institutions and investors; preparation and issuance of term sheets and loan agreements; issuance and administration of concessional loans; leveraging funds from other commercial and development finance institutions; and monitoring and management of concessional loan servicing and repayments.
The initial capitalization is 4 million EUR with an expected leverage of 8 million EUR through private sector financing and financial support from development partners.
The Facility’s sustainability aspect will be achieved through creating a revolving fund which will live beyond the DINU Programme period. This will be made possible through creating more partnerships with other potential funders, corporates and agencies. Any interested potential partners are invited to contribute to the facility to transform it into a nationally-owned sustainable and adequately capitalized loan/grant facility to support small and medium-sized value adding agribusinesses in Northern Uganda with the further intention to scale up its operation and coverage nationally.
Today the first call for proposals has been issued in the local newspapers. Small and medium enterprises from the 33 districts mentioned above or operating in these districts, engaged in agriculture value addition are invited to submit applications. The Private Sector Foundation of Uganda, along with START Facility partners, will hold call for proposals pre-submission and information sessions in the Northern Uganda main cities as per the schedule below. The purpose is to allow project developers an opportunity to raise questions and for START partners to provide guidance on how to prepare proposals to increase the chances of meeting the eligibility and selection criteria. Further communication on the consultations will be disseminated through local/district leadership and media announcements.
Planned information sessions on the call for proposals
June 14, 2018
9.00 am – 4.00pm
June 21, 2018
9.00 am – 4.00pm
Desert Breeze Hotel
July 05, 2018
9.00 am – 4.00pm
July 19, 2018
9.00 am – 4.00pm
ABOUT START Partners
The European Union (EU) is a political and economic union of 28 Member States. They decided to link together their know-how, resources and destinies. Together, they have built a zone of stability, democracy and sustainable development whilst maintaining cultural diversity, tolerance and individual freedoms. The EU is committed to sharing its achievements and values with countries and peoples beyond its borders. And in fact, over half of all development aid comes from the EU and its Member States, making them collectively the world's largest aid donor. Most aid goes to low-income and least developed countries.
The United Nations Capital Development Fund (UNCDF) makes public and private finance work for the poor in the world’s 47 least developed countries. With its capital mandate and instruments, UNCDF offers “last mile” finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. UNCDF’s financing models work through two channels: financial inclusion that expands the opportunities for individuals, households, and small businesses to participate in the local economy, providing them with the tools they need to climb out of poverty and manage their financial lives; and by showing how localized investments — through fiscal decentralization, innovative municipal finance, and structured project finance — can drive public and private funding that underpins local economic expansion and sustainable development. By strengthening how finance works for poor people at the household, small enterprise, and local infrastructure levels, UNCDF contributes to SDG 1 on eradicating poverty and SDG 17 on the means of implementation. By identifying those market segments where innovative financing models can have transformational impact in helping to reach the last mile and address exclusion and inequalities of access, UNCDF contributes to a number of different SDGs.
The Private Sector Foundation Uganda (PSFU) is Uganda’s apex body for the private sector. It is made up of over 200 business associations, corporate bodies and the major public sector agencies that support private sector growth. Since its founding in 1995, PSFU has served as a focal point for private sector advocacy as well as capacity building and continues to sustain a positive policy dialogue with Government on behalf of the private sector. Right from its inception, PSFU has been Government’s implementation partner for several projects and programmes aimed at strengthening the private sector as an engine of economic growth. PSFU aims to strengthen Private Sector capacity for effective policy advocacy and market competitiveness nationally, regionally and internationally. Regionally, PSFU is the national focal point for the East African Business Council (EABC) and the COMESA Business Council (CBC). It aims to advocate for an improved business environment and work with Government to reduce the cost of doing business in Uganda.
The Uganda Development Bank Limited (UDBL) is a public enterprise wholly owned by the Government of Uganda and carrying on business as a Development Finance Institution (DFI).
The bank, a successor company to Uganda Development Bank, was incorporated as a limited liability company under the Public Enterprises Reform and Divestiture Act, Cap.98, Laws of Uganda and it is mandated to finance enterprises in key growth sectors of the economy. The Bank has been in existence since 1972.
UDBL re-positioned itself as a key partner to the Government of Uganda in delivering its National Development Plan (NDP). In order to deliver this aspiration, the Bank focuses on the key growth sectors of the economy by financing development projects at attractive terms.
In order to deliver this aspiration, the Bank focuses on the key growth sectors of the economy by financing development projects at attractive terms. The Bank supports Small & Medium Enterprises (SMEs) and large scale development projects in the various key growth sectors notably: Infrastructure development; Industrialization; Primary agriculture, fisheries and livestock and, agro-processing; Natural resources extraction; Hospitality and Tourism; Real estate development; Information technology and telecommunication; Social services like Education including vocational and tertiary education and, health; Trade and Commerce Sectors.
For any additional information/clarification kindly contact:
For the European Union Delegation
Adolfo Cires Alonso
Finance, Agribusiness and Land
For the United Nations Capital Development Fund (UNCDF)
Jenifer Bukokhe Wakhungu
Development Initiative for Northern Uganda
+256 772 452 142
Ag. START Facility Manager
Plot 4 Ngabo Road, Kololo, Kampala Uganda
+256 782 500 973
For the Private Sector Foundation of Uganda (PSFU)
PR & Communications Manager
Plot 43, Nakasero Road.
+256 785 464 282
For the Uganda Development Bank Limited (UDBL)
Emoi John Peter
P.O.Box 7210, Kampala, Uganda
Rwenzori Towers, 1st Floor, Wing B
+256 775 649 129