Introduction - Thomas Timberg



Micro, Small & Medium Enterprise (MSME) Project37528508006080Submitted byNathan Associates London LtdlondonJanuary 30, 201200Submitted byNathan Associates London LtdlondonJanuary 30, 20123422653786505Project Completion ReportTable of Contents TOC \o "1-3" \h \z \u Introduction PAGEREF _Toc320543777 \h 3Section 1. Access to Finance PAGEREF _Toc320543781 \h 61.1.Purpose PAGEREF _Toc320543782 \h 61.2.Main achievements PAGEREF _Toc320543783 \h 71.3.ATF Legacy PAGEREF _Toc320543784 \h 91.4.Lessons learned PAGEREF _Toc320543785 \h 11Section 2. Business Development Services PAGEREF _Toc320543786 \h 132.1.The Rationale for the Innovative Approach PAGEREF _Toc320543788 \h 132.2.Main achievements PAGEREF _Toc320543789 \h 152.3.BDS Legacy PAGEREF _Toc320543790 \h 212.4.Lessons learned PAGEREF _Toc320543791 \h 21Section 3. Investment Climate PAGEREF _Toc320543792 \h 243.1.Purpose PAGEREF _Toc320543794 \h 243.2.Main achievements PAGEREF _Toc320543795 \h 253.3.IC Legacy PAGEREF _Toc320543796 \h 263.4.Lessons learned PAGEREF _Toc320543797 \h 27Section 4. Public Private Dialogue PAGEREF _Toc320543798 \h 294.1.Purpose PAGEREF _Toc320543800 \h 294.2.Main achievements PAGEREF _Toc320543801 \h 294.3.PPD Legacy PAGEREF _Toc320543802 \h 314.4.Lessons learned PAGEREF _Toc320543803 \h 31Section 5. Project Management PAGEREF _Toc320543804 \h 335.1.Project and Financial Management PAGEREF _Toc320543806 \h 335.munications PAGEREF _Toc320543807 \h 345.3.M&E PAGEREF _Toc320543808 \h 35Annex A. List of grantees for ATF component PAGEREF _Toc320543809 \h 36Annex B. List of grantees for BDS component PAGEREF _Toc320543810 \h 37Annex C. List of MSME events PAGEREF _Toc320543811 \h 44IntroductionThis final report presents the main outputs, outcomes and impacts of the Micro, Small and Medium Enterprise (MSME) Project in Nigeria. Given the highly innovative nature of this project, particular attention is given to the legacy and lessons learned from the interventions undertaken.The MSME ProjectThe MSME Project (2005-2011) was a pilot programme undertaken jointly by the World Bank and the Federal Government of Nigeria (FGN). The Executing Agency was the Nigerian Investment Promotion Commission (NIPC) which implemented the project through a Project Management Unit (PMU) managed by Nathan Associates London Ltd. (previously known as Emerging Markets Economics Ltd. and Nathan EME Ltd.) and Development Associates (DA).The aim of the Project was to improve performance and employment amongst MSMEs in selected non-oil industry sub-sectors and in three states of the country (Abia, Kaduna and Lagos) through increased private investment. To achieve this, the project aimed to develop and strengthen the capacity of local intermediaries to deliver financial and non-financial services to MSMEs; and reduce selected investment climate barriers that constrain MSME performance. It did this through five components:Component 1 - Access to Finance (ATF)Component 2 - Business Development Services (BDS)Component 3 - Investment Climate (IC)Component 4 - Public Private Dialogue (PPD)Component 5 - Project Management (including Monitoring and Evaluation (M&E)) A core objective of the pilot project was to implement specific types of MSME best practice models drawn from global experience. The goal was to see if the new and innovative approaches that the project applied delivered the desired outputs and outcomes in an efficient way across a few states of Nigeria. Nationwide coverage was initially not sought as it would result in too many disparate activities and locations, over-stretching management capacity and compromising project performance at outcome and impact levels. However, the World Bank committed to give consideration to extending project scope and outreach at a later date if the project results were positive. The innovative nature of the projectA range of new approaches and instruments were launched under this pilot project. The most relevant were:Establishing a partnership between the public and private sectors in Nigeria to deliver the Project. This included as the apex governing a Review Committee (RC) comprising a majority of representatives from the private sector as well as key government agencies.Provide a range of key services (e.g. ATF, BDS) combined with investment climate reforms to ensure an enabling investment climate for MSMEs. This was a recognition that MSMEs needed improved access to finance and BDS in order to be able to grow as well as a reduction in the cost of doing business to increase the incentive to invest. Reliance on private sector delivery channels to deliver the ATS and BDS components in order to promote responsiveness to enterprise needs and commercial sustainability. In order to enhance outreach and hence impact, rather than working directly with enterprises themselves, focus on intermediaries providing services to MSMEs. In practice, what this amounted to was that, instead of the then normal practice of stimulating MSME demand for services by subsidising the cost of services, the project stimulated the supply of services. Use of a transparent, open to all bidding’ process for selecting intermediaries that left the onus of what services would be delivered, the choice of who would provide technical assistance (TA), the target number of beneficiaries and intended impact of services and the commercial sustainability of the service provided to applicants to define. Such an arrangement left room for greater innovation and was considered less open to moral hazard than the normal approach of projects telling intermediaries what services they should supply and at what cost and providing the TA themselves. The use of performance grants agreements (PGAs) with intermediary service providers as the main instrument for ATF and BDS. The instrument was intended to allow project resources to be used more cost effectively, paying for results rather than inputs and it was expected to make intermediaries more accountable to the project for delivering results. Inspired by the emerging thinking on developing a more joined up financial sector, breaking the boundaries between microfinance and commercial banking by helping to up-scale the former and downscale the latter. Microfinance was to be up-scaled by moving away from the NGO driven model that catered for the needs of survival businesses to establishing commercial microfinance institutions (MFIs) that were able to lend larger sums suited to the needs of growth oriented enterprises. The commercial banks were to be supported in acquiring the skills and systems needed to lend smaller amounts of money profitably. Combine supply side stimulation of generic BDS services with BDS provision in specific value chains. It was believed that the latter could be especially effective in increasing linkages between firms within the value chains to facilitate the transfer of know-how combining access to BDS with a market for products (embedded BDS). The management structure adopted by the MSME Project was also innovative in two respects:The selection of NIPC rather than a Ministry to serve as Executing Agency. The choice of an autonomous agency responsible for promoting private investment provided the scope for less bureaucratic decision making and a more responsive attitude towards the needs of the private sector. The NIPC was, at that time of project design and appraisal, an autonomous agency that reported to the Presidency.At the apex of the governance structure was a Review Committee (RC) that provided policy direction and decided on all large items of expenditure. The majority of the membership of the RC was drawn from the private sector. The MSME Project was also innovative in that it piloted an enhanced partnership between IDA and IFC in the Africa region with the aim of leveraging strategic investors and investment funds; benefiting from economies of scale in knowledge acquisition and transfer resulting from the implementation of similar projects systematically across multiple countries; and better support to the FGN in its efforts to foster private-public dialogue, private sector investment and more effective donor coordination. Report outline This report has been structured following the five components of the project. Section 1 presents the access to finance component. Section 2 assesses the business development services component. Section 3 looks at the investment climate component and, within it, at each of its four subcomponents (business registration; credit bureaus; ADR; and secured lending). Section 4 presents the public private dialogue component. And finally section 5 assesses the project management component, including financial management, communications and M&E.Section 1. Access to FinancePurposeThe access to finance (ATF) component of the MSME project aimed to support financial intermediaries to increase their outreach in providing market-driven, commercially sustainable financial services to MSMEs in the three target States of Abia, Kaduna and Lagos. More specifically, this component was expected to provide grants to finance technical and capacity building assistance to commercial financial institutions (finance companies, commercial banks) and technical partners with expertise in the provision of financial services to MSMEs.At the time when this project was designed, MSMEs had limited access to credit in Nigeria. The microfinance industry in Nigeria was essentially “social microfinance”, meaning that it involved specific measures of subsidy from government or voluntary donors. The average size of loans was very low and it mostly provided support to survival businesses. On the other end, commercial banks worked very little with MSMEs as they faced problems such as lack of collateral, bad quality of business plans and/or perceived high risk of doing business with them. The ATF component aimed to demonstrate that there was space in Nigeria for “commercial microfinance”, that is, a commercially sustainable (not requiring continuing subsidy) provision of financial services to MSMEs. Commercial microfinance institutions would serve a group which are not the poorest of the poor, the bottom 20% of the income distribution, but what is called the “enterprising poor”, the middle three quintiles of the income distribution and in some cases even move into the top quartile. This commercially sustainable industry would bridge the “financial gap” that existed in the market, addressing the savings and borrowing needs of large numbers of MSMEs (and individuals) in the country. This intervention aimed to be transformative of the whole financial sector in Nigeria. The aim was to have a joined up financial sector that was able to meet the needs of all size of enterprise and to move funds to where they were most productive. The project envisaged this happening by achieving two outputs:Up-scaling traditional microfinance, which was previously focused on survival loans, so that it served the needs of the enterprising poor.Helping commercial bank downscale their services, thus improving access to finance for businesses at the smaller end of the SME size spectrum. What was particularly innovative in this respect was the fact that IDA did not attempt to build capacity of existing MFIs as many interventions seek to do. From the outset, the focus was on de-novo (new institutions). Hence, what the Project sought was to have new investors take a share of MFI investment and to introduce new, more commercial business models. Additionally, as opposed to previous IDA interventions, this component would not provide any financial resources to microfinance institutions (e.g. supporting capitalisation of MFIs, providing credit lines). All financial investment would have to come from commercial banks or investment in microfinance institutions. The Project would only provide resources for technical assistance. And, even here, the instrument to be used was not the usual procurement of TA by the project to support the MFI. Instead, the MFIs were expected to select their own service providers and to involve them in their businesses on their own terms. The project was free to select the applicants that it found likely to provide the best value for money and provide resources against the delivery of milestones agreed in a performance grant agreement. But for the rest, it was up to the investors to procure and manage the TA. Main achievementsThe ATF component of the MSME Project has been successfully completed. There are currently 4 new, commercially oriented MFIs running profitably and one commercial bank which has downscaled its lending. Together they account for between 10-20 per cent of all microfinance bank lending in Nigeria and are the leaders in the field. These operate under a regulatory framework that was developed with assistance from the project and is under the jurisdiction of the Central Bank of Nigeria (CBN). This regulatory framework is slowly being revised to accommodate problems as they emerge. As of September 31, 2011 there were roughly 39,000 borrowers with N6.2 billion (US$41.3 million) of outstanding loans and 1.2 million savers with over N20.4 billion (US$136 million of savings (most of the latter in the downscaling commercial bank). The total portfolio at risk (PAR) at 30 days was under 6%. Putting aside the older troubled portfolio of one institution (Susu MFB), the actual PAR at 30 days is under 2.3%. Over 50% of borrowers for reporting institutions were women and the level of financial sustainability was between 55.3 and 117 percent.The table below details the targets for this component and what have been the achievements as of 31/09/2012. Targets from PIMAchievements as of 31/09/2011At least two new microfinance institutions are established.For each MFI:At least 30,000 active clients by end of year 4.At least US$20 million outstanding portfolio by end of year 4.Financial self-sufficiency ratio at least 100% by end of year 4.Loan loss rate below 5% by end of year 4.Four new MFIs have been established (AB Microfinance Bank; ACCION Microfinance Bank, MicroCred Microfinance Bank, and Susu Microfinance Bank).Active borrowers and savers for each MFI are: AB (15,061/38,199); ACCION (12,089/59,084); MicroCred (5,294/ 10,096) and Susu (2,778/37,304) as of 31/09/2011. Total borrowers were 35,232 and total savers were 144,683.Total outstanding portfolio is US$33.9 million. Outstanding portfolio for each MFI is: AB (US$18.6 m); ACCION (US$10 m), MicroCred (US$3.3 m); and Susu (US$2 m) as of 31/09/2011. Financial self-sufficiency is 89% (AB), 117% (ACCION), 55.3% (Microcred) and 105% (Susu) as of 31/09/2011.Loan loss rate is 0% (Microred), 2% (AB) and 6% (ACCION) as of 31/09/2011 (the other grantee did not report). However, it was agreed that portfolio at risk (PAR) at 30 days was a better indicator: 0.65% (AB), 3.93% (ACCION), 0.78% (Microcred) and 4.99%* (Susu) as of 31/09/2011.New private sector investment in MFIs at least US$15 millionNew private sector investment in MFIs was US$30 million (N4.5 billion paid up capital) as of 30/06/2011. Note: This figure does not include paid up capital from the two microfinance banks that the MSME Project financed and are now closed.At least one commercial bank establishes an MSME downscaling programme.For each commercial bank:At least 5,000 active clients by end of year 4.At least US$10 million outstanding portfolio at end of year 4.Financial self-sufficiency ratio at least 100% by end of year 4.Loan loss rate below 5% at end of year 4.One commercial bank (Oceanic) established an internal microfinance section as of 31/09/2011. 3,818 active borrowers and 1,073,429 active savers as of 31/09/2011. US$7 million (N 1.017 billion) outstanding portfolio as of 31/09/2011.This figure is not available as the microfinance department is a unit within the bank, but the ratio is at least 100%.There is no figure available for this indicator, but it was agreed that portfolio at risk (PAR) at 30 days was a better indicator: this was 5.9% as of 31/09/2011.Bankers are aware of downscaling programme and develop more positive perceptions of commercial viability of downscaling.There have been successful meetings with Banker’s Committee on downscaling and a number of commercial banks (Afribank, First Bank, UBA, and IBTC) have invested in subsidiary banks. Including the three banks that have invested in ACCION (NIB [Citibank], Ecobank, and Zenith Bank), seven out of Nigeria's 22 commercial banks have invested in one form or another in commercial microfinance.*This figure is for new systems loans in Susu portfolio.ATF LegacyAs presented above, the MSME Project has supported the establishment of four new commercial microfinance institutions in Nigeria (ACCION Microfinance Bank, Susu Microfinance, AB Microfinance Bank and Microcred Microfinance Bank) that are running profitably and are expanding. It has also enabled one commercial bank (Oceanic Bank Plc, now fully merged with Ecobank Nigeria) to downscale its services, leading to the creation of the first Microfinance Department within a commercial bank in Nigeria. The project had also provided grants to two other MFIs (Integrated Microfinance Bank and MIC Microfinance Bank) but their licenses were cancelled because of the impact of the August-September 2009 international banking crisis. Overall, the institutions which remain account from between 10-20 percent of microfinance lending in Nigeria and are the leaders in the field. For example, ACCION was amongst the very first MFIs in Nigeria to receive approval from the CBN to start its operations. These institutions have contributed significantly to the flourishing of the commercial microfinance industry in Nigeria and the creation of a new market segment. In Nigeria, overall, there are over 800 microfinance banks currently licensed. However, the majority of these (around 500) are former community banks that have become MFIs. The fact that the 5 institutions supported by the project account for between 10%-20% of the market shows that a new, more successful business model that involves larger loans on a commercial basis has made huge in-roads into the market. The fact that a number of banks not supported by the project have also invested in microfinance institutions is testament to the fact the project will have succeeded in developing a new segment of the market. A recent assessment of the former community banks shows that most remain short of financial and managerial capacity. The demonstration effect has been particularly relevant in the case of Oceanic, as it has shown other commercial banks that it makes commercial sense to invest in microfinance. Although no other commercial bank has gone as far as Oceanic in creating a Microfinance Department, seven other commercial banks in the country have decided to invest in microfinance banks, therefore paving the way to expanding their businesses in the area of microfinance. The establishment of microfinance banks and downscaling of commercial banks has also allowed Nigeria to further close the “financial gap” that MSMEs suffered from. MSMEs can now have access to financial intermediaries whose technologies and products are better tailored to their needs, giving them, for example, the chance to access loans for investment in their businesses. In fact, an independent impact study of the ATF component revealed that it had succeeded in increasing access to finance for 25% of respondents. These were people who had not applied for loans in the past, because of the difficulties they perceived in obtaining loans, or had been turned down by other MFIs and banks. The study found that the improved access to finance had a positive impact on borrowers’ business with monthly turnover increasing 44% on average compared to pre-intervention levels a year previously. This represents a very rapid real increase as inflation during the period was around 7%-8%. Moreover, 83% of respondents agreed with the proposition that the sales were affected by obtaining a loan, so it is possible to attribute the increase in turnover to the provision of microfinance. An even higher proportion of respondents (86%) agreed that obtaining a loan had a (positive) effect on profitability of the business. The study showed, however, that the loans had a very small impact on employment. Only 12% of respondents reported increasing employment and the vast majority of those that did (91%) created 1-2 jobs only. The cause of this disappointing performance probably lay in the fact that the term of the loans remained comparatively short at around 6 months. Such short term loans are suited to increasing working capital rather than undertaking the longer term investment needed to create jobs. So, for the future, it can be postulated that the 4 MFIs the Project helped establish will continue to serve a very large numbers of savers (over 1 million) and serve at least 35,000 borrowers of which a quarter will not have had access to finance before. The number of borrowers, having fallen from 60, 000 as a result of the financial crisis, is rising again so it could be much higher. Those able to borrow are expected to witness a substantial increase in the growth and profitability of their businesses. Another important legacy of the project is the approval of a Microfinance Policy by the Central Bank of Nigeria in 2005. Although the MSME Project was not the reason for this policy to be approved, the project did certainly play a catalytic role in getting that regulation in place speedily. As a result, Nigeria now has in place a comprehensive policy on microfinance, together with detailed guidelines for the regulation and supervision of commercial microfinance. Lessons learnedThe implementation of this component has demonstrated that:Favourable regulatory environment. When designing an intervention that intends to promote innovation, it is important to ensure that the regulatory conditions are in place to allow the innovation to proceed. For example, at the start of the MSME Project, ACCION was ready to operate as a commercial microfinance bank but the CBN did not give it a license to operate because there was no microfinance policy in place. As a result, the project had to focus its initial efforts on helping the CBN to develop an adequate policy regime even though it was not one of the outputs included in the PAD/PIM. Only after the CBN issued its Microfinance Policy in December 2005 could the ATF component help to establish commercial MFIs. Policy and commercial incentives for innovation. It is important to have strong policy and commercial drivers to spur innovation. Originally, the decision of the CBN to allow the commercial banks to invest funds retained under the Small and Medium Enterprise Equity Investment Scheme (SMEEIS) in MFIs provided the incentive for the commercial banks to establish commercial MFIs. Later on, when the commercial banks were recapitalized under the CBN led bank consolidation program, the incentive to invest in MFIs and downscaling came from the banks looking to find new outlets to invest their increased capital base. These drivers were very helpful in delivering project objectives. Providing a vision of what is possible. More important than the financial resources provided by the Project was its ability to sell a vision of what was possible to achieve in the area of microfinance. After the microfinance policy was put in place, and despite the commercial driver provided by SMEEIS, the commercial banks remained reluctant to seek support from the project to establish new MFIs. In response. The project organized a series of workshops which introduced the Nigerian commercial banks to the experience of leading international MFIs. These workshops were instrumental in seven out of Nigeria's 22 commercial banks investing in commercial microfinance in one form or another. Facilitating access to expertise. The workshops and other outreach activities were instrumental also in introducing Nigerian financial institutions to the concept of strategic partnering with international technical service providers (TSP) that could help them well innovate financial services such as commercial micro finance, micro savings, micro insurance, and micro leasing. The financial institutions were also exposed to good practice in conducting external audit of their own operations and dealing with their own portfolio quality problems. This provided them with the assurance that the normally high risk of innovation could be managed. Adopting a portfolio approach to mitigate external risk. In promoting product innovation, despite the sourcing of international expertise, risks remain high so it is unlikely that all new entities established will succeed. Moreover, there is a need to provide for periodic shocks that could undermine the viability of the new entities established. In the case of the MSME project, these external risks took the form of the financial crisis in Nigeria that was triggered by the 2009 international banking crisis which exposed the internal weaknesses of the Nigerian banks. The scale of the crisis in Nigeria is evidenced by the fact that 10 Nigerian commercial banks had to be rescued by the CBN. The crisis led to the closure of two of the microfinance banks that the project had supported. The lesson learned is that in promoting innovation in a risky environment, it is prudent to mitigate risk by supporting a portfolio of investments so that a few will have the resilience to withstand shocks. Had the project only supported two new MFIs, it is possible that neither would have survived as both the MFIs that failed were considered viable at the time the project carried out its due diligence and one had even been named “the microfinance bank of the year” by the CBN. Due diligence needs to examine the extent to which all investors share the same ambitions. When undertaking due diligence is it important not only to look at capitalization and management issues, but also to analyze the cohesion of ambitions amongst investors. Diverging objectives may cause investors to pull out of ventures if and when things go wrong. For example, in the case of MIC Microfinance Bank, the due diligence provided assurance of the soundness of the investment but failed to take a close look at the level of cohesion amongst its promoters. One of the reasons for the failure of the bank was strife among stockholders.Performance grants have proved effective instruments. The use of a Performance Grant Agreement proved, in practice, to provide far greater accountability on the part of grantees than conventional matching grant arrangements whereby projects financed TSPs. The agreements bound the grantee to meeting milestones that they had set using TPSs they selected. So, there was far less moral hazard than when projects provide TA. In addition, they helped to ensure that funding provided was on the basis of progress made and outputs delivered by grantees, not inputs as in conventional matching grants. Linking payments to milestones ensured the value for money of the intervention. The MSME Projects’ experience has led to performance grants becoming widely used in all types of project interventions, especially enterprise challenge funds. Projects that promote innovation need to have longer life spans: The original timeframe for the implementation of this component (5 years) was too short given what was required to prove the viability of a new business model: develop a national policy and regulatory framework; find investors willing to put up the necessary N1 billion of equity to establish an MFI; identify the TSP with whom they could confidently work; set up and start operations; overcome the inevitable problems at start-up to prove the viability of the new business. Based on the experience of the MSME project, we recommend a 7 year life for such projects. Section 2. Business Development ServicesThe Rationale for the Innovative ApproachThe traditional donor approach to providing BDS was through demand-side interventions, for example, through matching grant schemes which subsidised the cost of services for MSMEs. The rationale for this approach was that MSMEs needed access to good quality BDS to grow but were uncertain of its efficacy and so unwilling to pay for it. By subsidising its use, MSMEs would be more willing to try using BDS, and hence to experience its benefits, thus growing the market for BDS.By 2000, however, major doubts had arisen as the cost effectiveness and sustainability of this approach. In its guidelines on BDS, the Donor Committee for Enterprise Development (DCED) expressed strong doubts over the sustainability of the approach because experience showed that businesses only used services so long as they were subsidised: once the grant element was removed, there was little repeat usage. Thus, interventions brought about no lasting change in behaviour. It recommended that BDS services should be subsidised pre-delivery, to increase the supply and quality of services, but not at the point of delivery. Soon after, the ILO in its BDS Primer, suggested that the most cost effective way of providing BDS was through the use of embedded services whereby large businesses, which held the market power in a value chain, were encouraged to transfer knowledge and skills to their smaller and less capable suppliers and distributors. Such an approach was particularly effective as part of wider interventions that addressed the efficiency and competiveness of industries and value chains. Informed by these findings, the MSME Project took an innovative approach that was designed to stimulate the supply side of the BDS market. The hypothesis was that Nigeria had competent, value enhancing BDS providers, but that their business models resulted in high cost and limited outreach narrowing access to BDS to large businesses and a few of the more progressive medium sized businesses. The hypothesis was confirmed by an independent survey commissioned by the Project which found that most MSMEs confined BDS usage to operational services (e.g. marketing, accounting, IT) but did not use strategic BDS (business planning, operational efficiency improvement) because of its cost and scepticism over its efficacy. In stimulating the supply of BDS, the Project chose also to take a more innovative approach to the more conventional training of trainers to increase the supply of competently trained BDS suppliers. The conventional approach was being used in Nigeria and other countries at that time and is still being used in many countries today. Its main failing was that, having been trained, the BDS providers found it difficult to obtain sufficient demand for their services to sustain a business. The failure to create additional demand for the newly trained BDS providers resulted in little change in BDS usage. As a result a downward spiral occurs. Potential trainees become aware that outcomes of training will not be as good as envisaged so the courses to learn to provide BDS services then need to be heavily subsidised until they are no longer economic. The downward spiral takes place because, without a shift in demand, increased supply simply leads to overcapacity. The cost of services may fall and the quality improve but, such gains are marginal: BDS providers, most of whom are graduates, are unwilling to discount their fee rates appreciably, not sufficiently to overcome the unwillingness of owners of small businesses to overcome their scepticism over the cost effectiveness of using BDS. Instead what the Project chose to do was to incentivise existing, competent BDS providers to increase outreach, enhance product innovation and promote sustainable business models to meet current demand that was not being serviced. Thus, the intervention addressed both demand and supply. The Project would share the risk of innovating a new business model but would not subsidize the cost of the service provided. Existing providers of good quality services were asked to provide business plans that showed how they were going to increase outreach in a commercially viable business model. If they succeeded in convincing the Project, they stood to receive up to 50% of the cost of establishing the service.This arrangement had a number of potential advantages over both demand side stimulation and the conventional supply side training provision:It was up to applicants to prove that they were able to provide good quality services. The PMU verified their claims through due diligence. Hence, the quality of service was assured rather than dependent on the quality of training and the aptitude of the trainee;It was up to the applicant to prove that there was demand for the services they planned to provide. Hence, with the right due diligence, it was possible for the Project to be far more assured of outreach and the possibility of latent demand being turned into continued usage in future; It was up to the applicant to prove that they had developed a sustainable business model for their new services. Applicants had to satisfy the Project of their potential to meet acceptable levels of cost recovery and repeat business to ensure commercial viability. So, sustainability was addressed at the outset.The Project design chose also to increase the competitiveness of selected value chains so that they would be able to grow faster and create more jobs. A value chain approach provided the opportunity to provide BDS as part of a set of activities that would reduce the causes of un-competitiveness, including changes in policies and strengthening institutions. BDS provision could be targeted at functions in the value chain that were the main cause of lack of competitiveness. In stimulating the supply of BDS, the approach used followed the same principles outlined above of addressing both demand and supply but with a recognition that far more use would be made of embedded services and shared services, whereby trade associations provided services that benefitted their members on a potentially commercial sustainable basis.In summary, the BDS component of the MSME Project used two main instruments:a US$ 5 million general BDS Fund to support good quality BDS providers to develop and deliver products and services tailored to the needs of MSMEs for which there was demonstrated demand and potential for commercial viability. four industry specific value chain development programmes (catfish in Abia, Kaduna, Lagos and Oyo States; palm oil in Abia State; rice in Kaduna State; and Tourism in Cross River State) which included targeted BDS grants aimed at improve key functions of the value chain as part of a wider set of activities that would improve competitiveness.The objective of the first mechanism was to boost MSME performance and employment levels by expanding the capacity of BDS providers in terms of their quality, outreach, cost-effectiveness, impact, and sustainability. The objective of the second mechanism was to improve the competitiveness of firms in specific industries by promoting the supply and demand of BDS, complementing this with private sector-led networking and market linkages and advocacy for policy and institutional change.With resources from the BDS General Fund, this component also sponsored the initial phases of two programmes: the Grooming Enterprise Leaders (GEL) program, which aimed to support at least 1,000 small and growing businesses in the six geo-political regions of the country and build the Enterprise Development infrastructure across these zones; and the Youth Enterprise with Innovation in Nigeria (YouWin), a national business plan competition to encourage and support aspiring entrepreneurial youth in Nigeria to develop and execute business ideas. These were a high priority for the present Government of Nigeria.Main achievementsGeneral BDS FundThe General BDS Fund assisted 47 BDS providers to develop and deliver products and services tailored to MSMEs. In total, these providers served over 20,000 MSMEs, one of the highest levels of outreach to firms of any BDS project. Although it was envisaged that the larger consulting firms, such as the big four accounting firms, would be interested in applying, it turned out that the amounts of the grants were too small and the scope too limited to interest them. Instead, this unprecedented level of outreach was delivered by SMEs. Moreover, the market was demanding support for a different type of BDS providers: a growing segment of second-tier training and consulting firms (as well as NGOs delivering entrepreneurship programs) that provided BDS to the large majority of MSMEs, particularly the lower end. As a result, the grantees (i.e. BDS Providers) were a varied mix, including for-profit consulting firms, NGOs, smaller accounting and auditing firms, and a privately owned business school. A detailed list of all BDS grantees and a brief summary of their interventions is included in Annex B. Overall, they provided the following types of BDS: Entrepreneurship Programs: the majority of grantees fell into this category. The MSMEs supported varied from small scale sole traders, artisans cultivators and fishermen, to owner-managers and established medium sized businesses. BDS was delivered via a combination of training, mentoring and, in some instances one-to-one business consultation. Some of the programs supported concentrated on particular industry groups and were combined with specialized technical assistance. Examples included the GEL Programme, Kaduna Business School and Bomez.Transfer of Specialist Skills: this involved the delivery of a specialist technical skill that served to improve the capability of the business to provide new services and increase competitiveness thereby having an immediate impact on business turnover. Examples included the automobile diagnostic and entrepreneurship program (Quick Projects) which enabled automobile mechanics to use electronic diagnostic method and a Fish Preservation Facility linked to entrepreneurial training for fishermen and fish traders (DSIF). Soft skills/ leadership and business strategy development: a number of grantees set out to design and deliver soft skills that had the potential to improve the effectiveness and efficiency of MSMEs focusing on issues such as succession planning, business strategy development, organizational and human resource development and business planning. BDS Providers in this category included LEAP Africa and TMC.Incubation services for particular types of business: this group included two grantees. Nextzon Business Services, that provided business incubation services for start-ups and early stage businesses with high growth potential; and Jadeas Trust, that focused on providing a nurturing and supportive business environment for creative artists most of whom had little or no entrepreneurial skills.The table below details the targets set up in the PIM for the general BDS fund and what have been the achievements as of 31/09/2012. Targets from PIMAchievements as of 31/12/2011Assistance provided to at least 20 BDS providersAt least 20 products or services improved or developed through Project supportAssistance provided to 46 Providers from General BDS Fund (excluding VC BDS Grants). 63 products or services improved or developed.At least 1,000 MSMEs receive BDS from participating BDS providers17,358 MSMEs have received BDS from participating BDS providers.Each assisted BDS provider demonstrates sustained uptake of supported products and services: by end of third year, at least 75% of clients adopt new behaviorsat least 25% of clients return for additional servicesby end of third year, BDS provider has at least 75% cost recovery on supported projects2.3.1 / 2.3.2 There are conceptual problems with the measuring criteria 2.3.1 and 2.3.2 but they have been probably met where appropriate. A certificate course (the Kaduna Program) could obviously not have repeat customers. A widely circulated casebook on family business succession has problems in defining each reader as a client. 2.3.3 Cost recovery for the specific activities considered is around 58%.The average cost recovery figure of 58% is below target. However, the average is brought down by a small proportion of grantees that failed to develop their business at all and whose grants were cancelled. The majority of new business models introduced are in fact commercially viable. Further, as business models mature and grantees become aware that funding from the Project is likely to stop in the near future, recovery rates are improving. It is expected that most of the grantees will be able to continue to provide services when the Project ends as their recovery rate is close to 100%. In addition to supporting over 20,000 MSMEs, the outcomes of the assistance have provided a very satisfactory return to the funding provided by the Project. A quasi-experimental, independent survey has compared the performance of 4 types of MSMEs:Group A: Treatment Group. MSMEs served by grantees of the project in the 3 pilot states.Control Group B: MSMEs in pilot states not receiving any BDS.Control Group C: MSMEs benefiting from BDS provided by others.Control Group D: MSMEs in non-pilot states not benefitting from BDS. The results shown in the table below that the BDS services supported by the project had a far greater impact than the various control groups, including those who had received BDS services from other providers (control group C):Measure of ImpactTreatment Group AControl GroupBControl GroupCControl GroupDIncrease in average quarterly sales+112%+11.2%-3.7%-3.6%Statistical significance (95% confidence)YesNoYesNoIncrease in employment42%N/A16%N/AStatistical significance (95% confidence)YesN/ANoN/AAcquiring new skills63%N/A38%N/AN/A: No comparable data available.Value Chain Development ProgrammesThe main achievements in each of the four value chain interventions were the following:Catfish: the Catfish Value Chain Development Programme facilitated the development of industry standards for the inputs and services through demonstration and dissemination practices; improved co-ordination and increased the incentive for adding value throughout the value chain. More specifically, the programme:Helped increase farmers’ yields as they applied the lessons provided by the programme.Incentivised the rehabilitation of catfish farms. The programme supported the rehabilitation of two farms, but the demonstration effect led to other 16 farms realising their need to improve – Kaduna (6), Abia (8) and Lagos (2).Helped develop the BDS industry for catfish as around 140 trainers and consultants acquired best practice skills and knowledge to support the design, construction and operation of catfish farms. Incentivised larger, more competent fish farmers to supply inputs and transfer knowledge to smaller, less developed businesses through embedded services. Strengthened the capabilities of FISON (Fisheries Society of Nigeria) and CAFAN (Catfish Farmers Association of Nigeria) to provide services and policy advocacy to their members.Helped implement best practices in the industry by developing new standard regulations and an accreditation system. Facilitated the modification of the curriculum of veterinary doctors in Nigerian Universities. Tourism: the Tourism Value Chain Development Programme demonstrated how private sector tourism operators could be brought together into a common Destination Management Organization such as the Cross River Quality Destination Management Organization (CRQ). In an industry such as tourism, where there is a need to deliver public goods such as destination marketing, the CRQ showed how the industry need not be constrained by the weaknesses of the public sector to deliver public goods. Moreover, it demonstrated how the private and public sectors could act in concert to address key issues of industry competitiveness, such as low occupancy in the off-season. The programme helped to develop the Ambassador Promotion Initiative (API) that marketed a discounted, off-peak product to tour operators. Although the pilot programme had little direct impact, recording less than one million naira in sales and fewer than 200 bed-nights, it nevertheless showed the potential of such initiatives: 200 bed nights was not an insignificant number increase in a period of very low occupancy. Moreover, the wider outcomes brought about by the pilot tourism programme in Cross River state were positive because:The Ambassadors Promotion Initiative was a catalyst for stakeholder involvement throughout the entire tourism programme to engage and involve both private sector and public sector participants in a common endeavour to promote Cross River’s tourism industry.The concept of the Destination Management Organization (DMO) and booking service was introduced to the Nigerian tourism industry for the first time and widely disseminated throughout the industry via the web and other outlets. A private sector-created CRQ Website () generated 1,497 unique visitors and a total of more than 214,000 hits from November 30, 2009 to March 15, 2010, when the promotion ended and the website was taken down. Differential pricing, up-selling, online information, reservations and settlement platforms and their benefits and other global best practices have been introduced to stakeholders through workshops during the planning of the Ambassador Pilot Initiative.New tour operators and travel agents were introduced to Cross Rivers through a familiarisation trip, Lagos press conference and launch event, and the distribution of materials providing increased visibility for the destination.The data collected in the first quarter of 2009 and the TEMPO Asset Audit proved to be a solid basis for stakeholder involvement through the Ambassador Initiative and provided invaluable data for M&E and an examination of bottlenecks in both the tourism products and facilitation value chainsRice: the Rice Value Chain Development Program deepened the understanding ofpolicy makers and private sector participants of the key constraints for the development of the rice industry in Kaduna, raised awareness among stakeholders of the benefits of adopting a value chain approach to the development of the industry and laid the foundations for closer collaboration between the public and private sectors in the rice value chain. It also:Created a pool of trained BDS providers who can now provide a variety of capacity building services and guidance on technical issues to farmers.Empowered KADP (Kaduna Agricultural Development Programme) agents to pursue and promote both cultural and agricultural changes in practices at the production and processing levels to increase the quality of rice production. Facilitated public-private partnerships by establishing a forum for key stakeholders to interact, which will further interventions in the rice industry alongside increased linkages between farmers, processors and consumers. Palm oil: the Palm Oil Value Chain Development Programme carried out a thorough analysis, the main causes of the loss of competitiveness of the palm oil industry in Abia State. It then set out a programme of action for improving the functioning of the value chain, and laid out a blue print for the transformation of the industry. More specifically, the programme:Developed small farmers’ operating guidelines; mill standard operating guidelines; and nursery operating guidelines for the use of the BDS industry. Provided theoretical and practical training to 120 MSMEs (60 oil palm nursery operators; and 60 small scale palm oil millers) and 75 palm oil farmers.Developed a blue print for development of industry.The table below details the targets set up in the PIM for the value chain development programmes and what have been the achievements as of 31/12/2012. Targets from PIMAchievements as 31/12/2011Assistance provided to at least 30 BDS providersAt least 20 products or services improved or developed through Project supportA total of 29 BDS providers have been assisted through the four value chain interventions – catfish (11), rice (5), palm oil (3) and tourism (10)29 products/services have improved or developed by the BDS grantees.At least 1,000 MSMEs receive BDS from participating BDS providers2,803 firms have received BDS from participating BDS providers – catfish (1,300), rice (997), palm oil (206) and tourism (300). Each assisted BDS provider demonstrates sustained uptake of supported products and services: by end of third year, at least 75% of clients adopt new behaviors at least 25% of clients return for additional servicesby end of third year, BDS provider has at least 75% cost recovery on supported projects2.4.1 Of those BDS providers who successfully completed their grants there is considerable sustained uptake.2.4.2 Not all the services provided require the provision of repeat or additional services to be effective (e.g. training). Where repeat use is relevant, repeat or additional use is in line with the target of 25%. 2.4.3 The initiatives under tourism (destination promotion) and palm oil (training) did not call for cost recovery. In catfish and rice, where grants were used to provide BDS, cost recovery was close to 100%.Trusted and reliable accreditation process for BDS providers is created (1st year: stakeholders agree on accreditation qualifications and criteria)This referred to the Catfish Value Chain Programme in particular. FISONS, a grantee, was supported by the programme to develop an accreditation system and has now drafted law, which it is pushing through Parliament, to give its accreditation system the force of law. There were also certification elements in the tourism VC intervention.Catfish association is established in response to industry-led demand for joint actionThe catfish associations already existed and were helped to become key BDS providers. BDS LegacyThe BDS component improved the turnover of the MSMEs that were the beneficiaries of the programme. As noted earlier, the independent impact study, using a quasi-experimental design which included treatment and control groups, concluded that the sales performance and job creation amongst the very large numbers of MSMEs that benefitted from the programme were significantly higher than that of firms with no access to BDS or with access to alternative sources of BDS. This demonstrated that it is possible with relatively modest sums of money to stimulate the supply of BDS. Moreover, the outreach and impact of such stimulation, if well managed could be very strong indeed. A major legacy of this component is that it has proven to relevant Nigerian agencies, such as the Small and Medium Enterprise Development Agency of Nigeria (SMEDAN), that there is a way to stimulate the supply of privately provided BDs that is cost effective and sustainable. In fact, the majority of grantees are growing and expanding the coverage of their services even though the MSME Project has ceased to finance them as they have discovered new markets for selling their services. And it is the commercial viability of their services that will ensure their financial sustainability.The BDS component has also led to product and service innovation that served the needs of MSMEs. For example, Nexton pioneered a private owned incubator in Nigeria; the LEAP Foundation developed new teaching material which has been widely disseminated; and Lateral Links has successfully marketed management education CDs.The four value chain development programmes (VCDP) were able to:Promote the adoption of new technologies and systems in the different industries. For example, as part of the tourism intervention differential pricing, up-selling, online information, reservations and settlement platforms were developed. Improve the standard regulations and accreditation systems of the industries. For example, in the catfish intervention FISON was supported to publish guidelines for standards in the industry and help its member achieve minimum standards.Increase the collaboration and cohesiveness in the different industries through the development of a DMO in the tourism intervention or the establishment of a stakeholder forum for the rice industry. In all instances, the four value chain programs helped to promote public private partnerships to improve competitiveness. Lessons learnedThe implementation of the BDS component has generated the following positive lessons:The new approach to BDS (innovating new business models) has proven to be very successful in terms of increasing outreach and improving the cost effectiveness of BDS – 20,161 MSMEs have benefitted from the support provided by the 75 BDS grants awarded by this component. The 75 BDS grants were awarded to 69 unique BDS grantees (i.e. there were 6 repeat grantees).The use of performance grant agreements (PGAs) has been highly successful as it improves the accountability of grantees to the Project for delivering results and ensured value for money of the intervention as the grants were disbursed in tranches linked to performance: grantees that failed to deliver were simply not paid. Most BDS providers have grown and expanded after they received the grants, were able to develop new markets and have reported that they recovered 100% of their costs of providing the services. Embedded services were particularly effective in delivering results. Those wishing to develop sub-contractors or supply inputs (catfish) or develop new markets for their equipment (automotive, rice) have an-inbuilt commercial motive for ensuring that the beneficiaries of the services that thy provide are able to prosper commercially and have first-hand experience of the business and so make for very effective providers of BDS. Embedded service providers that were attempting to increase their supply base were particularly effective combined the transfer of know-how with the commercial incentive of beneficiaries growing their business by supplying the larger enterprise, resulting in a highly effective combination of providing access to business support and a ready-made market for increased output.Equally important were the lessons learnt from what did not work as well as expected:Spreading risk: When attempting to innovate in as risky an environment as Nigeria, it is likely that not all the interventions will be successful. The project issued 75 PGAs of which 12 were cancelled earlier than expected (16%). This is an acceptable rate of failure but it did bring down the rate of cost recovery appreciably. In effect, spreading risk over 75 grantees (6 repeat grantees) helped to reduce the impact of the failures on the project so it is worth working with a sizable number of grantees.Due diligence over commitment and ability to withstand early reverses. To reduce the rate of such failures in the future, the selection of appropriate grantees is key. Whilst the main thrust of the due diligence should remain on the demand for the service and the sustainability of the business model, it important also to test the commitment of the grantee to the new endeavor and their ability to withstand losses at the early stage of introducing a new service. Most grantees struggled to begin with. It was those that were able to give themselves enough time to identify and remedy the causes of failure that were able to succeed in the end. Ensuring the soundness of the business as a whole, not just the business model for BDS. In addition, the due diligence needs to ensure that the totality of the grantees business is sound, not just the business model for BDS. In a number of instances, the cause of the failure was that the grantee’s wider business failed rather than the new BDS services. Providing sufficient time to deliver results in value chains. The time for implementation of the value chain development programmes was too short. Despite being pilot programmes, the 12-15 month implementation period was not enough to generate the desired change within the value chains. In particular, some of the capacity building activities should have been sustained longer to consolidate the gains (e.g. the catfish skills and knowledge gap is still significant; reluctance and inexperience among the targeted travel agents, tour operators and other resellers to promote a Nigerian destination remain) and some of the public private partnership interventions advanced too slowly because of challenges they faced (e.g. Destination Management Organisation in Cross Rivers State). However, the PGAs were excessively focused on the jointly funded activities rather than the overall growth and performance of the grantee.Providing sufficient resource for value chains to be effective. All the 4 value chain programmes were under-resourced in comparison to the task at hand. This lack of resource had several consequences: i) in a country considered to be a high risk operating environment, it reduced the incentive to bid for contracts reducing the quality of project implementers; ii) the lack of resource prevented implementers from undertaking sufficient levels of capacity building and facilitation activities to change the level of capability across participants at each stage of the value chain. Most implementers limited their activities to one function in the value chain or to training trainers in the hope that the training that they would provide in future would be able to have the desired outcome; iii) the level of BDS grants was insufficient to have an impact on market outcomes across the value chain. If these lessons could be incorporated into the design of subsequent BDS programmes, the experience of the MSME project suggests that they could become very cost effective. There is no doubt that, as it is, the BDS component achieved high outreach and added value compared to BDS provided by other providers. Section 3. Investment ClimatePurposeThis component was designed to improve the investment climate focusing on business enabling environment. By reducing the cost and risk of doing business, it was hoped to increase entrepreneurship and private investment. The four interventions included under this component were of special policy interest to FGN.More specifically, the four interventions undertaken were:Credit bureau: one of the causes of the low level of bank lending to MSMEs is the lack of reliable information on their credit histories. Before the Project’s intervention, the only source of credit information was the credit risk management system (CRMS) operated by the CBN which was both limited in its coverage (large loans only) and used principally to assist the CBN in its supervisory function and so not available to the commercial banks. Therefore, this project intervention aimed to create the legal and regulatory conditions for the establishment of private credit bureaus in Nigeria that would allow banks to rapidly assess credit histories and hence be more willing to lend to credit worthy MSMEs. Business registration: reducing the time and cost that it takes to incorporate a company or register a business would reduce the costs of doing business and incentivise informal entrepreneurs to formalize their businesses. To reduce the cost and time of registration, this intervention aimed to streamline the process, enable simultaneous registration with the Corporate Affairs Commission (CAC) and Federal Inland Revenue Service (FIRS) and to integrate the IT systems of the two to enable them to share data and further decentralise the registration process to their state offices. Alternative Dispute Resolution: In Nigeria, formal court procedures are slow, costly and often ineffective impeding the enforcement of contracts. The result is a high risk of doing business. This intervention aimed to develop and implement alternative dispute resolution (ADR) modalities, both court connected (referred by a judge) and free standing (organized independently of the courts), to reduce the cost burden and risks faced by MSMEs seeking legal recourse to contract enforcement in Nigeria. Secured lending and leasing: one of the other main reasons why banks do not provide credit for MSMEs is their insistence on the use of immovable property to serve as collateral for loans. Difficulties in obtaining clear title to land and in enforcing liens over property through an unsympathetic, slow and expensive court system reduce the willingness of the banks to lend except with very high collateral cover. This intervention aimed to develop a viable regime to govern the use of moveable property as collateral (including leasing) that would allow for enforcement of rights through a private contractual arrangement without recourse to the justice system and, as an alternative, through expeditious summary court proceedings. Main achievementsThe main achievements of each intervention undertaken under this component are as follows:Credit bureau: this component supported the CBN to develop and implement the legal and regulatory reforms necessary to permit privately owned credit bureaus and the utilization of credit bureau services. Facilitated by the new regulations in place, there are currently 3 privately owned credit bureaus functioning in Nigeria, Further, an industry association has been formed which is now cooperating with donors to promote further reform and develop the industry. More specifically, the project assisted the CBN’s Banking Supervision Department to: i) prepare the guidelines for licensing operations and regulating privately owned credit bureaus in Nigeria; elaborate a manual to guide the supervision of such credit bureaus; provide training to CBN staff on this matter. The project also organised workshops on credit information systems and funded a study tour to familiarise CBN staff on best practice in regulatory regimes and supervision of private credit bureaus.Business registration: the objective of this subcomponent was to streamline the procedures and integrate the registration processes of the CAC and the FIRS to reduce the steps and needed and time taken for company and business registration. The component supported: the development of streamlined and common set of procedures, formalized in a Memorandum of Understanding between the CAC, FIRS and NIPC; the supply and installation of hardware (computers) throughout the offices of the CAC, FIRS, and NIPC to improve data storage and retrieval and enable greater decentralization of decision making; and the development of appropriate software to link the systems of the CAC and FIRS. A common set of procedures and forms have been developed and necessary hardware and software has been installed. As recorded in the Doing Business reports, the number of steps needed to register a business has fallen from 10 in 2005 to 8 in 2012 and the time needed has fallen from 44 days to 34 days. The linking of the systems of the CAC and FIRS has taken much longer than expected due to problems in getting the provider of the proprietary software used by CAC to make the modifications at an acceptable price. Nevertheless, pilot trials of the linkages are being conducted at present. Secured lending: this subcomponent supported the development of policy institutional and legal reforms, as well as capacity building, to facilitate the use of moveable assets to be used by banks and non-bank financial institutions as collateral for lending. More specifically, the project worked with CBN, the Ministry of Justice and other financial sector stakeholders to build consensus on the need for secured lending legislation, supported the preparation of a draft law and developed a prototype pledge registry for lending against movable assets. The draft law has been adopted by the Financial Sector Scenario (FSSP 2020 Project of the CBN as part of its 2012 legislative programme. Alternative Dispute Resolution: this subcomponent of the Project supported the opening of two new multi-door courthouses (court connected) in Umuahia (Abia State) and Kaduna that would enable judges to refer cases to the appropriate form of alternative dispute resolution and provided assistance to the existing Lagos Multidoor Court (court connected) and Citizien’s Mediation Center (free standing, run by the Ministry of Justice independently of the courts). The table below details the targets set up in the PIM for this component and what have been the achievements as of 31/12/2012. Targets in the PIMAchievements as of 31/12/20113.1 Legal and regulatory framework for credit bureau established3.2 Private sector credit bureau is created3.3 Bank officers’ awareness and knowledge of credit bureau increased3.1 The legal and regulatory framework for credit bureaus has been established.3.2 Three private sector credit bureaus have been established and are functioning. 3.3 CBN staff have been trained in supervision of credit bureau. The awareness of the services offered is spreading across the banking industry but there is a need for greater awareness and capacity building to increase usage of services. The industry association is undertaking this.3.4 Alternative dispute resolution mechanisms developed and implemented in up to three States3.5 Diagnostic conducted, programme design completed, and formal agreements reached by end of year 13.6 Time required to resolve commercial dispute under alternative system at least XX% less than prior/existing system (target level contingent on diagnostic)3.4 Two new ADR Multidoor Courthouses have been created in Abia and Kaduna, and the existing Multidoor Courthouse and the Citizen’s Mediation Center in Lagos have been strengthened.3.5 The diagnostic, design and implementation have been completed, though not within a year. 3.6 The Abia and Kaduna Multidoor Courthouses have just been established so it is too early to measure impacts. There is evidence of increased usage of mediation services at the Citizen’s Mediation Center in LagosIC LegacyCredit bureau: as a result of this intervention, there are now three registered private credit bureaus in operation in Nigeria which are making it easier for the banks to lend to MSMEs with a good credit record. They have over 18 products, 100 employees and handle 30,000 to 40,000 credit enquiries per year. However, they are still not operating on the desirable scale so an industry association is working with donors and the Central Bank to further refine the regulatory and legal framework and conduct a program of capacitation for the financial sector and the bureaus, as well as raising public awareness. The Project’s legacy will of providing greater credit information to reduce the risk of lending to MSMEs should be cemented by these follow on activities. Business registration: the common set of procedures and forms that have been developed together with the hardware and software that has been installed have helped to develop a less burdensome and speedier business registration system. This has enabled the numbers of companies registered to increase from 28,988 in 2005 to 65,089 in 2009. When the integration of IT systems of the CAC and FIRS becomes fully operational (which we expect to happen by mid-2012) the time and cost of registering a business further. What the Project’s main legacy will be is that both CAC and FIRS have recognised that easier registration will result in more businesses registering with them and that will lead to both earning more revenue. They have also recognised that they need to work together on reducing the time and cost of registration as there are mutual benefits for both. Secured lending: the draft law (and its approach) that was prepared with support of the project has been adopted by the Technical Advisory Group of the FSS 2020 Project of the CBN. Along with the chairs of the two Parliamentary Banking Committees, they have committed to its enactment this year. Putting the law in pace will constitute the first step in establishing the regime for secured lending. Subsequent steps include the establishment of a pledge registry, drawing on the initial efforts and lessons of the MSME Project in setting up a modern computerised web-based registry. What the Project’s legacy will be is that secured lending is a central part of FSS 2020 and will be championed by the CBN. Alternative Dispute Resolution: the Lagos Multidoor Courthouse (LMC) and the Citizens Mediation Centre have both expanded their activities. The latter has now mobile centers which move around the city and serves over 6,000 clients a year. The LMC is experiencing an increase in the volume of cases it deals with and is currently viewed as a national model. The two Multidoor Courthouses in Umuahia (Abia State) and Kaduna have just opened and are handling their first few cases. This should result in the reduction in the time and cost of resolving commercial disputes and enforcing contracts as well as ease the pressure of the backlog of cases on the courts. Other states in Nigeria are likely to follow suit on ADR and that should help to spread its benefits across the country. Lessons learnedA number of lessons were learned during the process of implementing the four interventions that have implications for the process of delivering business environment reforms more generally. Most importantly, what they have highlighted is that providing good quality TA is not a sufficient condition for successful reform. A set of conditions for success need to be present including the following:Strong policy imperatives for reform backed by influential organizations or people. In many countries, the impetus for reform has come from policy imperatives such as complying with the accession commitments to trade blocks or international bodies (i.e. EU or WTO). In Nigeria, such drivers are not strong so there need to be other policy imperatives to drive reform. The MSME Project benefitted from former President Obasanjo’s personal commitment to reduce the time and cost of registering businesses. Momentum on credit bureau and secured lending came only when the CBN announced its commitment to increasing access to finance through FSS 2020. And progress on ADR was slow until the Chief Justice of Kaduna and Abia adopted it as their policy.The existence of incentives for agencies to take forward reform. To ensure the full commitment of any public sector institution to reform, it is important that the institution stands to gain from the reform either in terms of being able to discharge its statutory duty more cost effectively or through earning more revenue. For example, in the business registration subcomponent, the incentive for CAC and FIRS to implement reforms was that they would be able to collect more fees from business registration as a result of the reform.An influential constituency that can exercise leadership and lobby for change. Where the policy imperative and/or the incentive for the agency to undertake reforms are weak, there is a need for an influential constituency to lead the process of change and advocate for reforms. For example, the issue of the need for legislation to enable the growth of secured lending has been kept in the minds of policy makers by the Equipment Leasing Association of Nigeria (ELAN). The newly formed association of credit bureaus is playing the same role in promoting the interests of its members. Provide time and resources for building consensus. In the absence of an influential constituency, it will be up to project implementers to build consensus on the need for and shape of reforms. This is especially true when there are divergent views on what is needed. Most scope of work do not provide for such consensus building and that can constitute a ‘penny wise pound foolish policy’. For example, in the secured lending subcomponent, there were divergent views on what reforms were needed. It took much longer than expected to build consensus putting great strain on the sub-contractor’s resources. Securing the services of authoritative TA providers. Where those charged with implementation have credibility with the public sector agencies and private sector stakeholders involved, progress in overcoming obstacles will be greater. The presence of local experts to facilitate communication with stakeholders is also important. For example, in the ADR subcomponent, the presence of an influential local expert was a great asset. The extent to which these conditions were present had a major influence on the progress made on each of the 4 interventions. Therefore, it is important that the design of business environment reforms in future incorporates an examination of whether these conditions are present or not.Section 4. Public Private DialoguePurposeThe purpose of the PPD component of the MSME Project was to provide targeted, performance-based capacity building to foster increased public-private sector collaboration on MSME development. More specifically, this component aimed to:Facilitate dialogue between the public and private sectors to improve policies and programmes targeted at MSMEs and to disseminate lessons, best practices, and success stories from the project to facilitate constructive dialogue. Support the learning agenda of the public sector institutions that work with the private sector such as the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and NIPC through study tours and best practice workshops.Support the institutional development of these institutions, building on lessons learned from international best practices, designed and implemented in accordance with the findings of institutional diagnostic studies, subsequent operational plans and an associated capacity building program proposal. This component was not fully defined at the time when the MSME project began and the above statement of objectives was developed in the first years of the project.Main achievementsThe PPP component was able to achieve the following:Organise public private dialogue sessions in Abia and Kaduna at the highest level, involving the states’ governors, and support follow-through action committees to develop the resulting agendas. However, at the suggestion of the World Bank, the follow through work was handed over to the World Bank Nigeria Investment Climate Project. Trained 285 government officials, including NIPC, SMEDAN, CBN and state government officials in the target states through courses and workshops in Nigeria and overseas involving international experts.Prepare training-needs assessment for NIPC, SMEDAN, state ministries and private sector institutions with whom the MSME project worked.Support the Nigerian Economic Summit Group (NESG) to prepare 2 studies that fed the action committees in the two states (Abia and Kaduna) and organise a number of seminars and workshops that provided major inputs into the National MSME Strategy supported by UNDP and developed by SMEDAN. The project also sponsored one NESG Competitiveness Report and the organisation of a competitiveness forum.Support SMEDAN to develop a new institutional strategy. With the assistance of Dr. Ed Canella from the Philippines, the Director General and Directors of SMEDAN participated in a week long process of elaborating an institutional strategy, followed through by a study tour to Ahmedabad in India. The new strategy was strongly endorsed by SMEDAN’s Director General.The table below details the targets set up in the PIM for this component and what have been the achievements as of 31/12/2012. Targets in PIMAchievements as of 31/12/20114.1 26 public sector personnel from NIPC, SMEDAN and state-level ministries (e.g., commerce and industry) receive advanced project-related training.4.2 Training participants provide at least one in-house seminar upon return.4.3 Training participants prepare training summary report.4.1 159 unique public sector personnel from NIPC, SMEDAN, CBN and federal and state-level ministries have received advanced project-related training through 285 training activities (247 courses and 38 study tours). Note: Some personnel have benefited from more than one training course/study tour.4.2 26 of the trainees have conducted post training seminars.4.3 66 training summary reports have been prepared (verbally or written).4.4 Annual roundtable discussion, beginning 2nd Qtr 2005, between government and private sector to establish dialogue on policies and programs targeted at MSMEs and to disseminate lessons learned, best practices, and project success stories.4.4 The project held three roundtables for MSME financial services providers; two stakeholder forums on private credit bureaus; one consultative forum on commercial bank downscaling; two PPD roundtables on IC; two knowledge sharing ADR events; co-sponsored three annual NESG NES; three BDS fairs; two stakeholder forums in rice and tourism. There were also several materials (brochures, documentaries) which were widely distributed. Note: This section was redesigned in the period following the completion of the PIM.4.5 Project is represented on the programme of Nigerian Economic Summit (NES) every year beginning 2005.4.6 Three MSME Competitiveness Reports.4.7 Three Competitiveness fora.4.5 The Project signed a memorandum of understanding with the NESG and supported the implementation of the NES programme. In addition, the project co-sponsored the annual NES Summits and the work of the Non-oil & Agriculture Policy Commission, and supported representatives from the State Governments in the project states to participate in the NES and dialogue. 4.6 One MSME competitiveness report was prepared in conjunction with the NESG and other stakeholders. Note: This activity was done late in the project because the project had been previously directed to drop the element.4.7 One Competitiveness forum was organized in conjunction with NESG and other stakeholders. Note: This activity was done late in the project because the project had been previously directed to drop the element.PPD LegacyThe main legacy of the PPP component is the following:The promotion of dialogue between the public and private sectors in the states of Abia and Kaduna was a new departure which helped to forge an alternative pathway to promoting reform to the standard practice of lobbying and using influence behind close doors. It helped to reduce the mutual suspicion in which both sectors held each other.National level dialogue, through respected interlocutors such as the NESG, showed that there was far more to be gained through informed, evidence based dialogue than through the practice of demanding subsidies and incentives that was the norm at the competiveness fora that were undertaken before the Project commenced. The existence of a large cadre of public and private officers (especially from SMEDAN and NIPC) who have been trained by the project and exposed to state of the art ideas about market led business development services and the business environment. A number of them have returned and conducted seminars for their organizations. For example, the first project coordinator used the cases he wrote up a part of his training course to urge a reorientation of NIPC.The Project contributed substantially to Nigeria’s National MSME Policy which aims to improve the business environment and capabilities of MSMEs.The strengthening of SMEDAN, which benefited from the support of the project to develop and implement a new institutional strategy. The capacity built at CBN to undertake policy reforms needed to improve access to finance for MSMEs.Overall, the feedback received from recipients of Project sponsored training activities, in the form of courses, workshops, seminars or study tours, is that they have been very beneficial to their understanding of the needs of MSMEs and what may be done to improve their performance. All those trained in specific functions of project management, such as accounting or procurement, believe that their capabilities have been enhanced considerably. NIPC staff associated with the Project state categorically that the training and exposure they have received has considerably enhanced their capability to manage, large complex projects in the future. It is important to note that outcome reports were collected form all recipients and they show a strong and consistent level of satisfaction with the training provided. However, no systematic institutional impact study was scheduled for this component as it represented a very small proportion of the project’s activities. Lessons learnedThe main lessons learned from the implementation of this component are the following:Dialogue needs respected interlocutors to ensure it is evidence based and aimed at specific reforms. Unstructured dialogue is often unproductive and can soon lead to dialogue fatigue. Dialogue needs to address a particular policy processes or institutional changes. Further, it needs to be structured and informed by evidence.Adapting capacity building to the HR systems of recipient organisations. The process of reform envisaged of carrying out training needs and institutional assessments, developing operational plans based on them and then helping to provide capacity building support was a supply led approach that ignored the HR practices in the organizations concerned. The result was considerable delay as the organizations failed to develop sound plans. It would have been far more effective to take a two pronged approach: i) where TNA led to the provision of targeted training to develop specific skills and competencies; ii) the organizations were provided TA to improve their HR systems with respect to capacity building. Ensuring that trainees understood how they needed to account for expenses. There is a different way of handling travel expenses in Nigeria as compared to World Bank requirements, so there is frequently resistance to adjusting to the latter. In particular, Nigerian travel advances do not typically have to be receipted and excess advances do not need to be recovered, so considerable firmness is required on the part of program administrators to recover these or obtain receipts.?Further, once travel is over, while some participants readily report or fulfil their responsibilities in terms of feedback to their organizations, others are either not willing or able to do so.Finding appropriate ways of funding events. The process of funding training events is complex under Nigerian disbursal norms, especially with the ban on cash disbursement by the Government to what is otherwise still a heavily cash oriented economy. The PIM suggested contracting out the arrangement of all travel, training and enlightenment events, but this approach was not implemented on the advice of the World Bank. Still, this approach would have been preferable to avoid the challenges faced by what occurred in practice: money from the project account was advanced to reliable partners (e.g. PMU), who would then disburse cash to the multiple beneficiaries of an intervention (e.g. participants to a workshop or training course). The project partners would then recover the receipts/excess funds from all the beneficiaries and reimburse the project account for the total advance.Section 5. Project ManagementProject and Financial ManagementThe executing agency of the MSME Project was the NIPC, who contracted out the project management function to Nathan Associates London Ltd., a private sector firm specialising in economic development consultancy. The financial management of the project, however, remained under NIPC, and the World Bank retained a veto power. Lessons learnedThe following main lessons were learned whilst implementing the MSME project:Simplified governance with clear lines of accountability. These are axioms of sound governance and management practice that were largely absent in the case of the MSME Project. The institutional and implementation arrangements of the MSME Project were unwieldy and required enormous cooperation to allow the project to move forward. In particular, the governance system comprised a Review Committee made up of stakeholders, an executing agency (NIPC), a PMU subcontracted out to Nathan Associates and the World Bank with right of no objection. To make such a convoluted system work required a very good understanding of the roles and responsibilities of the different entities involved to ensure that no conflicts arose between the different entities and decisions could be made quickly. At the start of the Project, several bottlenecks were faced which put at risk the successful implementation of the project. Decision making was slow involving constant to and fro between the bodies. It took months of frustration before the situation improved. It is essential that a better system is designed that ensures simpler lines of authority and accountability. In particular, the World Bank has to either be prepared to take a hands-on role and thus become integrated into the Executive Agency, as occurred when a Task Team Leader with the necessary time and inclination came to be responsible for this Project. Or it needs to exercise its supervisory role in a less involved manner carrying out annual reviews and periodic spot checks. The system of No Objections embodies poor governance and management practice. Contracted out versus in-house project management: the relationship between the Executing Agency (EA) and PMU. According to the NIPC, the arrangement worked well with the EA and the PMU collaborating well. For our own part, we credit NIPC with allowing us the opportunity to make the Project work. Certainly, other MSME projects funded by the World Bank that used in-house PMUs, such as the one in Ghana, have made much less progress than this Project. However, we are aware that a contracted out PMU need not be more effective than an in-house one. In Kenya, the PMU of the MSME Project has been contracted out yet that project has experienced lengthy delays. What matters is the relationship between the EA and the PMU. At the least, the EA must hold the PMU to account for performing the services in an efficient and effective manner. This could difficult when the PMU is formed out of the EA. The ideal, however, is that the EA empowers the PMU to make progress exercising a governance role over it. That is what happened a few years into this Project. Clearer guidelines on expenditure on training and workshops. The World Bank guidelines on “training and workshops” expenditure are much less structured than those for “goods and consultancy services”. It would be very helpful for future project if these were better defined.?Guidelines on performance grants. Similarly, there are no real guidelines for the disbursement of grants, which are now progressively a larger part of World Bank activities, and the World Bank disbursement regime is not adjusted to them.Investing in building financial management capacity: The entity responsible for the financial management of large projects must have the adequate human resources and systems to efficiently manage it. Where there is a need to strengthen capacity, appropriate training should be provided at the outset of the Project, not during it. Without exception, where an EA has not undertaken a World Bank project before, its project accountant should be sent on a course to familiarise him/her with World Bank procedures and requirements for record keeping. Although NIPC has improved significantly its financial management capacity over the life of the project, there are still issues to be resolved such as the need for strong internal auditing and a proper records filing system that should have been resolved at Project outset. Incentivising EA staff: We noted earlier the need for agencies involve in implementing reforms to have incentives to do so. This applies to the EA as well. EA staff regard projects as not part of their day to day duties. Whilst many take on their additional responsibilities willingly, an underlying resentment can develop if they see others benefitting from the project when they do not. The provision of training that will help advance their careers helps to offset resentment but serious attention needs to be given to performance related bonuses for project staff. We recognize this is a contentious subject, much discussed but without results, but it is an issue that the Bank needs to take up with governments if it wishes to see more uniform progress. This Project was fortunate to have, for the most, EA staff who were dedicated to its success. But, others have surely suffered because their EA staff resent the fact that projects impose demands on them but do not reward them in tangible municationsThe MSME Project was responsible for designing and implementing a communications plan that would ensure the proper dissemination of the lessons learned during the project. The specific communications activities implemented by the project (besides the numerous stakeholder meetings, workshops and events specific to each of the four component of the project and the final closeout event) were:Development and maintenance of a project website which hosts the main documents and reports produced by the project (i.e. content management platform).Creation and wide distribution of brochures for the main component of the MSME Project (ATF, BDS, and IC) as well as dissemination reports on the results of three value chain interventions (tourism, rice and catfish).Production of the film “Story of Gold” in collaboration with Credit Awareness Nigeria (CAN). The film was premiered in December 2011 and is undergoing an extensive impact evaluation by the World Bank funded by a special grant awarded by the Russian Fund. A documentary production on the MSME Project that was transmitted by NTA in January 2012.In general, there was extensive media coverage of project activities as detailed in the list of newspaper articles and television presentations included in the final administrative report. Additionally, there were a variety of public sessions (mostly held in connection with specific subcomponents) at which stakeholders had a chance to participate and learn from the project. These are listed selectively in annex C.Lessons learnedThe following lessons were learned from the implementation of this component:The communications component needs to be rolled out from the very beginning of a project to ensure its maximum impact. The PMU was responsible for communications but the budget did not include the cost hiring a communications specialist. In fact, a specialist should be devoted full time to this activity from the beginning of the project to ensure the successful implementation of the communications activities. M&EThe M&E of the MSME Project required the following reports to be produced: quarterly programme reports; annual progress reports; mid-term review; implementation completion report. All reports were successfully prepared by the PMU.Monitoring of the project was also undertaken through the following:Compilation of a database containing the outcomes of all BDS and ATF interventions.Implementation of two independent impact analyses assessments conducted in collaboration with the Special Joint Vice President’s Office of the World Bank and IFC for Private Sector Development on the ATF and BDS components.Implementation of a “descriptive analysis” of the MSME Project conducted by an independent consultant who had undertaken similar analysis of the other pilots MSME projects in the Africa region.Additionally, each implementing partner had independent contractual responsibility for monitoring and evaluating their own activities.Lessons learnedThe following lessons were learned from the implementation of this component:The importance of enforcing the monitoring and evaluation and related reporting requirements on grantees and contractors, even though it is sometimes difficult to do so. In fact, this was a factor that led to the cancelation of some of the BDS grants.The desirability of having specifically mandated independent impact analyses of the different components of the project.The provision of a substantial budget for an M&E system is essential. The focus nowadays on experimental and quasi-experimental evaluation in particular imposes heavy demands on resources. It is, however, an expense that must be budgeted for. Annex A. List of grantees for ATF componentNameTechnical Service ProviderPaid-Up CapitalLicensing StatusGrant disbursed as of 31/09/12Number active clients as of 31/09/12AB-Microfinance Bank LagosLFS Financial ServicesN1,500 millionLicensed as a MFB$1,500,00038,199Accion Microfinance BankACCION InternationalN1,206 million Licensed as a MFB$1,500,00061,000 (12,557 active borrowers)Susu Microfinance BankIntellecap (India) and ROSMO (Kenya)N773 millionLicenced as a MFB$1,196,00037,109 (2,047 active borrowers)-Dec ‘12Microcred MicrofinanceMicrocred/Planetfinance, (France)N1,000 millionLicenced as a MFB$1,500,00022,461 (5,294 active borrowers)Oceanic BankGenesis Analytics (South Africa) and Microsave (Kenya)NAIn house microfinance department $975,0001,071,000 (3,338 active Borrowers) – June ‘12MIC Microfinance BankK Rep (Kenya)N287 millionLicense cancelled$528,0000?IMFB MicrofinanceECIAfrica (South Africa)N1,758 millionLicense cancelled$650,0000Annex B. List of grantees for BDS componentGeneral BDS fundBDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusAdebola Shobanjo & Co.Train 50 MSME owner-managers in financial planning and cash flow management.41,00041,000CompletedAdonai Community Empowerment SocietyProvide business development services to 50 rice farmers and 100 fish farmers in Epe, and 50 cassava farmers in Badagry, Lagos.18,62118,621CompletedAgrifind ConsultantsProvide business management training to 100 agro-MSMEs in Kaduna.30,00029,924CompletedAkada Konsults Provide mentoring and coaching services to 100 MSMEs in Kaduna and Lagos.45,00026,930CancelledArewa Hotels Training LimitedTrain 200 MSMEs in the Hotel and Catering Industry in Kaduna North, Kafanchan and Zaria Local Government Councils.45,00013,500.00CancelledBomez Nigeria Ltd.Provide business development services (including export assistance) to 100 leather (shoe & bag) and garment manufacturers in Abia State.29,79829,725CompletedBusiness School of Entrepreneurship (KBS)New venture creation programme in Kaduna – 500 participants (1st batch of 36 graduated in March)60,00059,807CompletedCentre for Micro-enterprise DevelopmentAdd value and strengthen capacity of the clothing, leather and agriculture (rice) sectors in Lagos and Abia states86,50086,352CompletedCrimson Business Solutions LtdCrimson MBA for 38 participants & new enterprise evaluation & development programme, Lagos49,74629,843CancelledDev-Centric International LtdCreate a small enterprise development centre in Umuahia (Abia State); provide business advice on radio; provide management training to 150 participants and 15 MSMEs.71,00070,683CompletedDevelopment & Social Initiative FoundationCreate a fish preservation facility and provide entrepreneurial training for fishermen and fish traders in Lagos.57,00056,855CompletedDiamond Development InitiativesProvide technical and business support services to 50 agro-MSMEs in Kaduna, including ginger farmers.55,00054,774CompletedDiligent NigeriaDevelop, register and host 60 MSME websites in Lagos.41,50041,394CompletedDPA & A ConsultDevelop a manual and deliver quality management to 32 MSMEs in Aba.20,00019,949CompletedEconomic Support Foundation Northern StatesSupport 30 metalwork MSMEs in Panteka market (Kaduna).30,00029,953CompletedEmil ConsultingProvide training and consulting services to 250 MSMEs in Aba, Arochukwu, Ohafia, Ukwa and Isiala-Ngwa.30,00030,000CompletedEnsign Engr & SurveysProvide technical and entrepreneurial skills training to 200 microenterprises in Aba.42,0008,036CancelledHealth Matters Inc.Provide BDS to entrepreneurs in information technology, bead stringing, and hairdressing.72,00071,908CompletedHills Project Ltd.Develop prawn farming and entrepreneurial skills for 100 artisan fish farmers in Lagos.41,00040,832CompletedIFDC NigeriaSupport 25 agri-business MSMEs in Kaduna to increase their value-added.125,000124,730CompletedIntegral Development KonsultDevelop and provide 6 training modules/programmes to 140 participants in Kaduna.21,89721,360CompletedJadeas TrustProvide BDS to a cluster of creative artistes resident on FESTAC premises in Lagos.126,000126,000CompletedJustin Nwosu & Co.Train 150 MSME garment makers, fabricators and leather goods makers in Aba & Umuahia.37,23037,135CompletedKalflex Int'l Ltd.Provide technical and vocational training to 60 carpenters and furniture makers in Kaduna.30,00030,000CompletedKalisa KonsultTrain 90 MSME artisans, tailors and foodretailers in Kaduna.25,65015,325CancelledLateral Links LtdProduce and distribute a business toolkit in CD-ROM format for at least 5,000 MSMEs in Kaduna, Abia and Lagos.22,70022,630CompletedLEAP AfricaProvide leadership training and coaching to 45 MSMEs in Kaduna and 45 MSMEs in Aba, and publish a book on leadership and succession planning for Nigerian MSMEs.40,00039,871CompletedLondon Business Development AgencyDeliver business training and advisory services to 200 MSMEs .68,00068,000CompletedNextzon Business Services LimitedSet up and operate a commercial business incubator in Lagos.105,000104,583CompletedNoble House Management ConsultingProvide business development services to MSMEs in the confectionary business.40,00039,949CompletedNorth South DevelopmentProvide agro-processing and entrepreneurial training to 240 agro-MSMEs in Aba.54,00054,000CompletedPartners for DevelopmentSupport Kafenchan-based BDS providers using their worldwide network.130,000130,000CompletedPearl Ent & Allied ResourcesProvide technical and vocational training to 70 tailors and fashion designers in Aba.35,00035,000CompletedQuick Projects LtdProvide technical and entrepreneurship training to 180 auto-technicians in Lagos using automobile diagnostic equipment.92,67392,375CompletedSada Idris & Co.Train 125 MSMEs in light manufacturing and agribusiness sectors in Kaduna.43,90025,871CancelledSimplex Automation Systems LtdAdd value and build information technology capacity among 150 MSMEs in Kaduna.50,0009,936CancelledStrategic Capital Alliance LimitedProvide BDS to groundnut farmers.90,00054,000CancelledSupport & Training Entrepreneurship Programme (STEP)Create a business advice radio programme in Igbo language in Aba and provide entrepreneurship training to 130 trainees in Lagos and 100 trainees in Aba.73,50073,300CompletedTechEdge ConsultingDevelop a training manual and deliver quality management training to 45 MSMEs in Aba.31,00030,921CompletedTefal AssociatesProvide support to 50 MSME metal fabricators for the production of metal drying cabinets and treadle irrigation pumps.25,00025,000CompletedToki Mabogunje & Co. (TMC)Create a MSME TV programme, newsletter, and website and train 220 participants and consulting firms in Lagos, including 22 MSMEs.50,00049,839CompletedVertical Optimisation (Aquada)Provide BDS services to cassava farmers.88,75053,250CancelledVSL ConsultingAdd value and strengthen capacity of the 75 machine/metal fabricators and leather shoe/bags producers in Aba.43,50043,432CompletedWider PerspectivesProvide BDS on computer and internet use.95,60494,879CompletedWIMDAStrengthen the capacity of the Widows Multipurpose Development Association and facilitate skills acquisition for its members.50,00050,000CompletedTOTAL GENERAL BDS FUND2,459,5692,211,472Additional interventionBDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusEnterprise Development Center (EDC), Pan-African UniversityGrooming Enterprise Leaders (GEL) Programme (support to 1,000 small and growing businesses in the six geo-political regions of Nigeria and build the Enterprise Development Infrastructure across these zones) and Youth Enterprise with Innovation in Nigeria (YouWin) Programme (organise a national business plan competition to encourage and support aspiring entrepreneurial youth in Nigeria to develop and execute business ideas).2,500,0002,500,000CompletedTOTAL ADDITIONAL INTERVENTION2,500,0002,500,000Catfish Value Chain Development Programme BDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusAgricultural Business Concepts LtdBuild management capacity in catfish farming operations of catfish farmers in Nigeria (Abia, Kaduna, Lagos and Oyo States) through catfish farming business and simulation game.17,50017,500CompletedCentre for Agriculture and Rural Development (CARD)Build technical and management capacity of catfish farmers in fish processing and management in Abia State.30,000.0030,000CompletedFisheries Society of NigeriaDevelop professional certification and industry standardisation for the catfish industry, and support the publication of “FISON Today” in Abia, Oyo, Kaduna, and Lagos states.45,00045,000CompletedGateway Farms LimitedBuild technical and management capacity in catfish farming for farmers in Abia State.45,00045,000CompletedIcecool Contracts LtdBuild technical and management capacity of catfish farmers in Nigeria for website development, hosting and maintenance; and develop, host and maintain a comprehensive website for CAFAN in Nigeria.35,000010,500CancelledMitboaf VenturesBuild technical and management capacity of catfish farmers in Lagos State in catfish farming using self-powered closed water recirculating system.29,0008,700CancelledNovat ConsultingBuild technical and management capacity of catfish farmers in fish diseases control and management in Lagos (85), Abia (25), Kaduna (25) and Oyo (25) States.35,02210,507CancelledPremier Packs & Gardens (PPG) EnterprisesBuild technical and management capacity of catfish farmers in Kaduna State on grassroots/rural catfish farming.20,00020,000CompletedSkodak Agro Industrial Projects Nigeria LimitedBuild technical and management capacity of catfish farmers in Oyo State in catfish farming fish feed production and business management.22,50022,500CompletedTee Ess Integrated Farms Nigeria LtdBuild technical and management capacity in catfish farming for farmers in Lagos State and publish the specialised quarterly journal, “AQUACULTURE BEST”.45,00045,000CompletedHills GlobalBuild technical and management capacity in hatchery construction, operations and financial management capacity of catfish farmers in Lagos State.35,27135,271CompletedTOTAL CATFISH359,293283,228Tourism Value Chain Development ProgrammeBDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusVandom Ventures MPCS LimitedDevelop a service incentive reward programme in collaboration with Chapleni Nigeria Limited (BDS Grantee) to support the CRQ customer service standards training.20,00020,000CompletedOrganisation for Rural Community Development (RUCODEV)Survey and report on the local sourcing potential for the hospitality sector in CRS, Nigeria, and design, create and deliver 770 souvenir baskets for the Ambassador Program.50,00050,000CompletedRimalis Int'l ServicesDesign, introduce and sell packages to CRQ wholesale distribution network; oversee package fulfilment; coordinate entertainment activities with arts and entertainment managers.35,00035,000CompletedJemi-Alade & Associates Ltd.Build technical, management capacity in hatchery construction, operations and financial management capacity of catfish farmers in Lagos State.50,00050,000CompletedGoBeyond EnterpriseDesign FAM trip; identify and engage source market intermediaries, wholesalers and travel journalists to participate in the FAM trips; oversee visitor experience and fulfilment of the FAM trip, capturing the impressions and recommendations of the FAM trip participants. 50,00050,000CompletedGlobe Executive TravelsDesign, introduce and sell packages to CRQ wholesale distribution network; oversee package fulfilment; coordinate entertainment activities with arts and entertainment managers.50,00050,000CompletedChapleni Nigeria LimitedProvide capacity building services by training selected individuals in the CRQ Training-of-Trainers (ToT) Programme50,00050,000CompletedCellulant Nigeria LimitedData mining to target appropriate market segments; implement an SMS-based marketing promotion; manage relations with the mobile network operators.50,00050,000CompletedCaritas Communications Ltd.Advise on the creation of marketing materials for developing and executing a CRQ advocacy and communications management plan; coordinate an upscale launch event to kick off the CRQ Ambassadors’ promotion programme marketing and sales efforts.50,00050,000CompletedNovaRostaOrganize a music and entertainment festival to be held in conjunction with the CRQ Ambassadors Promotion in February 2010; organize an arts, crafts and souvenir exhibit to run as part of the CRQ Ambassadors promotion in February 2010.30,00030,000CompletedTOTAL TOURISM435,000435,000Rice Value Chain Development ProgrammeBDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusFantsuam FoundationProvide pre-loan, agriculture enterprise development, business and management training to 300 rice farmers.23,80723,806CompletedPremier Parks & Gardens (PPG) EnterprisesBuild capacity of the PPGE team in irrigation technologies and provide technical training and practical demonstrations in modern irrigation systems, handling of irrigation equipment and application of irrigation methods; create awareness of the intervention in targeted regions leading to the formulation of a rice cluster with key values of ownership, empowerment and sustainability among local actor; organise farm visits to established irrigated rice farming systems to enable experiential learning.33,56533,564CompletedOgbuka Green MerchandiseBuild the capacity of 15 metal fabricators on the design and construction of rice parboiling drums; train at least 18 rice parboiling families across the state in the use of parboiling drums; provide small equipment demonstrations to rice farmers; and manufacture and sell 30 parboiling drums.25,00025,000CompletedLondon Business Development AgencyTrain rice market stakeholders on how to brand and market industry products, develop and recommend rice packaging for retail sale of the products, provide information and contacts on rice packaging equipment and techniques, and link rice stakeholders to micro and macro finance institutions.44,00035,200Partially completedGefez Technical ServicesFacilitate public private partnerships through the organisation of a Rice Industry Investor Forum and a Rice Industry Supply Show.25,00025,000CompletedTOTAL RICE151,372142,570Palm Oil Value Chain Development ProgrammeBDS ProviderSummarized Description of ActivityUS$ Grant approvedUS$ TotaldisbursedStatusEmil Consulting Ltd.Improve the technical knowledge of 60 nurserymen so that they can manage nurseries better, produce better quality seedlings and improve their business management skills so that they can own and run sustainable and profitable businesses.23,80723,807CompletedNoblehouse Management ConsultingEnhance the capacity of 150 oil palm farmers on standard techniques of oil palm plantation management to expand and sustain their businesses.33,56533,565CompletedTechedge Consulting Ltd.Train and mentor 60 small scale palm oil palm millers in Abia North, Central and South Senatorial Zones in best practice techniques of processing oil palm fruit, particularly in fruit fermentation; harvest to milling; cooking temperatures and times; palm kernel storage; processing equipment; mill maintenance; and environmental issues.25,00025,000CompletedTOTAL PALM OIL82,37282,372Annex C. List of MSME eventsComponent 1: Access to FinanceDateLocation1First roundtable on Technical Service Provision for MSMEJune 2006Lagos, Nigeria2Roundtable on ATF Component for MSMENovember 2006Kaduna, Nigeria3Roundtable on ATF Component for MSMENovember 2006Abia, Nigeria4NationaL Stakeholder Workshop on Credit BureausJune 2006Lagos, Nigeria5Award Ceremony for Access to Finance Grants to Susu and MIC Microfinance BanksFebruary 2007Lagos, Nigeria6ACCION Microfinance Bank LaunchingJuly 2007Lagos, Nigeria7Workshop on External Audit for MicrofinanceMarch 2009Lagos, Nigeria8Workshop on Portfolio Quality and GovernanceMarch 2009Lagos, Nigeria9External Audit of Microfinance Banks in NigeriaApril 2009Lagos, Nigeria10Savings Mobilization for Commercial MicrofinanceAugust 2009Lagos, Nigeria11Savings Mobilization for Commercial MicrofinanceSeptember 2009Kaduna, Nigeria12Workshop on MicroLeasingDecember 2010Lagos, Nigeria13Workshop on MicroinsuranceDecember 2010Abuja, Nigeria14Screening of financial education movie “The Story of Gold”December 2011Lagos, Nigeria??Component 2: Business Development ServicesDateLocation1Training on Market Oriented Small Business Development Services for BDS ProvidersFebruary 2007Abuja, Nigeria2?Workshop for Catfish VC BDS GranteesJune 2008Lagos, Nigeria3Training on Market Oriented Small Business Development Training for BDS ProvidersAugust 2008Abuja, Nigeria4Lagos BDS FairMay 2009Lagos, Nigeria5Kaduna BDS FairJune 2009Kaduna, Nigeria6Abia BDS FairJune 2009Abia, Nigeria7Value Chain Workshop, jointly organised by MSME Project & DFIDOctober 2009Abuja, Nigeria8Training on Market Driven BDS and Value Chain Development for BDS ProvidersNovember 2009Abuja, Nigeria9?Workshop for Tourism VC BDS GranteesNovember 2009Calabar, Nigeria10?Workshop for Tourism VC BDS GranteesJanuary 2010Lagos, Nigeria11Kaduna BDS Fair hosted within the 31st Annual Kaduna International Trade FairFebruary 2010Kaduna, Nigeria12Tourism Value Chain Stakeholders’ Final SeminarJune 2010Calabar, Nigeria13?Workshop for Rice VC BDS GranteesJuly 2010Kaduna, Nigeria14ILO/ITC Training of BDS Providers on Women's Entrepreneurship DevelopmentNovember 2010Abuja, Nigeria15Rice Value Chain Development Stakeholders Final SeminarDecember 2010Kaduna, Nigeria16ILO/ITC Training of BDS Providers on Women's Entrepreneurship DevelopmentMay 2011Abuja, Nigeria17Stakeholder Workshop for Palm OilNovember 2011Umuahia, NigeriaComponent 3: Investment ClimateDateLocationCREDIT BUREAUS1National Workshop on Credit Bureau Development in NigeriaJune 2006Abuja, Nigeria2Implant Training for Credit Bureau Operations in Nigeria (for CBN staff)March 2009Abeokuta3Study Tour - Regulating Credit Bureaus September – October 2009Washington and Chicago, USA / Cairo, Egypt4Stakeholders Workshop on Credit BureauDecember 2011Lagos, NigeriaBUSINESS REGISTRATION1Signing of MOU on Business Registration among NIPC, CAC and FIRSSeptember 2007Abuja, Nigeria2Workshop on Credit Bureau for CBN StaffFebruary- March 2009Abuja, Nigeria3Implant Training for Credit Bureau Operations in Nigeria (organised solely for CBN staff)February 2009Kaduna, NigeriaSECURED LENDING1Secured Lending Inaugural Stakeholder’s meetingMay 2009Abuja, Nigeria2National Workshop on Secured Lending/SecuritizationNovember 2011Abuja, NigeriaADR1Study Tour to Uganda on Commercial Court Practices (ADR)February 2007Uganda2ADR Seminar “Commercial Alternative Dispute Resolution for Core Stakeholders”November 2007Abuja, Nigeria3ADR Assessment Report Presentation ForumFebruary 2009Abuja, Nigeria4ADR Stakeholder’s Phase 2/Design Phase ConferenceJune 2009Abuja, Nigeria5Training - Alternative Dispute Resolution (ADR)October 2009Washington, USA6Signing of Protocol on ADR by Abia StateJune 2010Aba, Nigeria7Settlement Week of Lagos Multi-Door CourthouseJuly 2010Lagos, Nigeria8Opening ceremony of Abia State Multidoor CourtDecember 2011Umuahia, Nigeria9Opening ceremony of Kaduna Multidoor CourtDecember 2011Kaduna, NigeriaComponent 4: Private – Public PartnershipDateLocation1Intervention Design and Management in BDS – NIPC-1 and SMEDAN-1 July 2004Glasgow, UK2Microfinance Training – NIPC-1August-September 2004Plokwane City, South Africa3Seminar on Model Law on Leasing – Chartered Inst. Of Arbitrators – NIPC-1October 2004Rome, Italy4Goods and Equipment Procurement Course – NIPC-1November 2004Durban, South Africa5Accounting Software System Training – NIPC-4November – December 2004Lagos, Nigeria6Financial Management & disbursement training – NIPC-5September 2005Malawi7Financial management & disbursement training II – NIPC-4November 2005Malawi8Workshop on Procurement & Consultancy Service – NIPC-1November 2005Lagos, Nigeria9Capacity Building and Needs Assessment Workshop – NIPC-11 and SMEDAN-8December 2005Abuja, Nigeria10Course on The General Manager Program(TGMP) – NIPC-1January 2006Harvard, US11Principles & Practice of MSME Promotion & Development – NIPC-17, SMEDAN-10, Kaduna State-2, Lagos State-2, Abia State-2.June 2006Abuja, Nigeria12Summit on Sustaining Reforms and Unlocking Nigeria's Potential – NIPC-1, Kaduna State-1, Abia State-1, Lagos State-1June 2006Abuja, Nigeria13Collateral Reform and Access to Finance – NIPC-1, CBN-1 and FMoJ-1July 2006London, UK14Creating an Enabling Environment for Small Enterprise Development – NIPC-2, SMEDAN-2October 2006Turin, Italy15Prevention, Analysis & Detection of Corporate Fraud – NIPC-1October 2006Mombasa Kenya16Study Tour by CBN to CGAP and WB on microfinance regulation – CBN-4October-November 2006Washington DC, USA17Local Government .Investment Climate Reform – NIPC-2, Kaduna State-1, Abia State-1, Lagos State-1March 2007Tanzania18Strengthening OSIC for Accelerated Public Sector Reform – OSIC-39March 2007Kaduna, Italy19Study Tour on Alternative Dispute Resolution Systems – NIPC-1, SMEDAN-1, Kaduna State-1, Lagos State-1, Abia State-12007Uganda20Phase 1 Study Tour on IPA Strategy for IC Reforms- NIPC-3, FMoF-1July 2007Botswana21Financial Management Training – NIPC-1October 2007Turin, Italy22NIPC Directors Study Tour to Egypt – NIPC-3, FMoC-1November 2007Egypt23Training on Practical Internal Auditing – NIPC-1June 2009London, UK24Training on Project Management – NIPC-1July 2009London, UK25Training on Public Financial Management, Planning and Control – NIPC-1August 2009London, UK26Training on Monitoring and Evaluation – NIPC-1September 2009Canada27Study Tour on Regulating Credit Bureaus- NIPC-1, CBN-6September-October 2009Cairo, Egypt and Washington DC/Chicago, USA28Results-Based Management Implementation and Performance Indicators – NIPC-2September-October 2009Canada29Training on Alternative Dispute Resolution Systems – NIPC-1October 2009Washington DC, USA30Study Tour for ES NIPC, NIPC-1October 2009Bangladesh31Training -Crown Agents Certificate in Procurement for Senior Executives – NIPC-1November 2009London, UK32Sustainable Microfinance – NIPC-1November 2009London, UK33Training - Results-Based Management Implementation and Performance Indicators – NIPC-2, FMoF-1November - December 2009Malaysia34Creating an Enabling Environment for SME Development – NIPC-8November-December 2009Turin, Italy35PMI Global EMEA Congress– NIPC-1May 2010Milan, Italy36PMP (Project Management) Boot Camp – NIPC-1May 2010Fairfax, USA37Project Budgeting and Cost Control – NIPC-1May 2010Canada38Monitoring and Evaluation – NIPC-1August 2010London, UK39Project and Program Impact Assessment – NIPC-1August- September 2010Montreal, Canada40Project Budgeting and Cost Control – NIPC-2October 2010Malaysia41Study Tour by NIPC Executive Secretary to microfinance and enterprise development institutions – NIPC-2October 2010Indonesia42Advance Audit Skills – NIPC-1October 2010London, UK43Project & Programme Management Training – NIPC-2 and FMoF-2November 2010London, UK44Results based management implementation and performance indicators – SMEDAN-1November 2010Malaysia45Public Financial Management: Planning and Control – NIPC-2November-December 2010London, UK46Procurement Public Training Course – NIPC-1December 2010London, UK47Creating and Enabling Environment for Sustainable Small Enterprise Development – NIPC-5 and SMEDAN-3November – December 2010Turin, Italy48Auditing Contracts – NIPC-1February 2011Dubai, UAE49Regulating Financial Markets – NIPC-1March 2011Washington DC50Monitoring and Evaluation – NIPC-1March 2011London, UK51Leading a Project Team – NIPC-1March 2011Dubai, UAE52Effective Finance in Projects – NIPC-1March/April 2011London, UK53Leadership and Scenarios Course – NIPC-1May 2011Oxford, UK54Project Management – NIPC-1May 201London, UK55Project Management – NIPC-1May 2011Dubai, UAE56Establishing a results-based M&E Framework for SMEDAN – SMEDAN-52June 2011Abuja, Nigeria57Summer Academy on Sustainable Enterprise Development – NIPC-6June 2011Turin, Italy58Strategic and Financial Planning – NIPC-2June 2011Sutton, UK59Study Tour for SMEDAN DG and Directors – SMEDAN-5July 2011Ahmedabad, India60Study Tour for NIPC Directors (1st batch) – NIPC-3July 2011Ahmedabad, India61Study Tour for NIPC Directors (2nd batch) – NIPC-3July 2011Chennai, India62Public Financial Management – NIPC-1September 2011Sutton, UK63Project Cycle Management – NIPC-6October 2011Turin, Italy64Advanced Arbitration and Mediation – NIPC-1October-November 2011Washington DC, USA65Leadership for Senior Managers – NIPC-1November 2011Dubai, UAE66Procurement Management for WB Projects – NIPC-2March 2012Turin, Italy ................
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