Enterprise Challenge Fund for the Pacific and South-East Asia (ECF)

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Due to high demand and a consistently high quality of bids, all available ECF grant funding (a total of AU$14.5 million since July 2007) will have been allocated by the end of bidding round 3. No further bidding rounds are likely to be conducted during this phase of the pilot program. A mid term review, currently scheduled for September/October 2009, will inform a decision by the Australian Government about the future of the Enterprise Challenge Fund. Please continue to check our website for updates.

Interested parties are being asked to sign up for the ECF e-newsletter on the website to keep updated with the latest information.

With the closure of Bidding Round 2 in December 2008, a further 11 grants totalling $7,418,620 were awarded.

Countries where approved projects were awarded include:

Cambodia;
East Timor;
Fiji;
Lao PDR;
Papua New Guinea;
Solomon Islands; and
Vanuatu.

Details on the individual business projects will be made available once a contract has been agreed between each bidder and the ECF management team.
For more details on current projects, please see the ECF website.

Background

Australia will provide $20.5 million over six years to pilot an Enterprise Challenge Fund for the Pacific and South-East Asia.

The Enterprise Challenge Fund provides an opportunity for private-sector businesses to participate in an open competition for matching grants to fund commercially viable business projects.

Providing access to employment and markets is vital to generate a sustainable reduction in poverty. The Enterprise Challenge Fund aims to stimulate growth and ensure the poor are included in the benefits and opportunities provided by growth.

In many countries in our region, innovative private sector projects fail to attract financial backing, not because of low returns, but because of weaknesses in financial markets and the 'public good' nature of some of their benefits. The private sector may be reluctant to undertake pro-poor projects because of perceived risks, lack of information or the high costs of creating new markets. The ECF will help to overcome these constraints. Through open competition, grants of $100,000 to $1.5 million will be awarded to business projects with pro-poor outcomes and that cannot obtain financing from commercial sources.

At least 50 per cent of the project costs must be met by the partner business, and all projects must be commercially self-sustaining within three years.

Initial research for the ECF in the Pacific and South East Asia indicates that potential projects are likely to relate to the extension of financial services, agricultural advisory services to poor people, and investments that create new or improved market linkages. These will lead to the creation of jobs and income-earning opportunities.

The success of individual projects will demonstrate to business and governments that pro-poor commercial opportunities exist in our region. By raising awareness of these opportunities and what may limit a firm from successfully pursuing them, the impact of the ECF can extend beyond individual projects to improving the business environment for all firms.

The Fund Manager for the ECF is Coffey International. They are responsible for marketing and managing the Fund.

For more information see the ECF website [external].

March 2009