Press Release
12 June 2007
A challenge to business: unlock African potential
 The UK today became one of the first donors to get behind a new fund which
will support businesses to help people in Africa become economically active.
Leader of the House of Lords, Baroness Amos, announced that the UK will
provide $20 million over three years to the Africa Enterprise Challenge Fund (AECF).
The AECF will provide match-funding for business innovations that improve the
economic prospects of the most excluded in Africa, as employees, entrepreneurs
or consumers.
Speaking at the World Economic Forum on Africa in Cape Town, South Africa,
Baroness Amos said:
“Business development is essential in the fight against poverty. Last week
the G8 reaffirmed the importance of this in stimulating economic growth in
developing countries and encouraged businesses to improve the level of
sustainable investment in those countries.
“The Africa Enterprise Challenge Fund will help to deliver this. It
encourages innovation in trade and commerce to help those who are most excluded
enter the world of business. The Fund will become operational in 2008 and I hope
that businesses will see its potential and use it to stimulate growth."
Other donors who have already committed to support the Africa Enterprise
Challenge Fund include the
 African Development Bank, the
Consultative Group to
Assist the Poor (CGAP) and the
International Fund for Agricultural Development (IFAD).
The AECF will become operational in early 2008. It will offer grants of up to
$1.5 million to businesses that provide innovative proposals for improving
people's chances to take part in economic activity, particularly in the areas of
finance and agriculture (70% of Africans work in agriculture).
An example of the type of project that might receive funding from the AECF is
a mobile phone system that is helping Kenyans without bank accounts to transfer
money.
The M-Pesa system, run by Safaricom, and partly funded by the UK's Department
for International Development, allows users to borrow, transfer and make
payments using text messages. Customers visit one of a network of shops, pay a
cash deposit, and then 'text' the sum to the recipient - who uses a secure pin
number to pick up the funds at another shop.
The number of mobile phone users in Kenya - more than 6.5 million - is far
greater than the number of people with bank accounts, so the system provides an
affordable financial service to many who have no other way to access such
services.
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Notes to editors
1. The Commission for Africa's report in 2005 recommended that more needed to
be done to harness the private sector's resources to promote innovation and
access to markets for the poor. At the Gleneagles summit in 2005, the G8 made a
commitment to do this. Two years on from the Gleneagles, lives are being changed
for the better.
2. Valerie Amos (Rt Hon Baroness Amos of Brondesbury) was appointed Leader of
the House of Lords and Lord President of the Council in October 2003. As well as
her duties as Leader and Lord President she continues to speak on international
development issues for the Government in the House of Lords. Baroness Amos was
Secretary of State at the Department for International Development from 12 May
2003 to 5 October 2003.
3. For more details on the Africa Enterprise Challenge Fund, go to
http://www.africaenterprisechallengefund.org
For further information, contact Pete Lewis on 020 7023 1722 or 020 7023
0600, e-mail pressoffice@dfid.gov.uk or call our Public Enquiries Point on 0845
300 4100.
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