Traditional development cooperation alone is not enough. Development needs additional support in the future, and that requires new methods. Finnish investors could invest more in Africa and through that assist in creating jobs, but the risks are often too high for most potential investors. FCA Investments works with mitigating these risks and bringing together financiers and companies in need of investments. The private sector plays an important future role in supporting the poorest countries.

Traditional development cooperation alone is not enough in the future, and investment activities will help creating jobs, supporting families and communities to earn their livelihood and raise the tax revenue in developing countries. A chance to work and earn an income contributes significantly to the stability and development of a society.

However, the need for traditional development cooperation is not disappearing. For example, needs for quality education and vocational education in the developing countries remain huge. FCA continues its work for people’s right to quality education, right to livelihood and right to peace.

FCA Investments supports small and medium sized enterprises (SMEs) in developing countries. Our goal is to make profitable investments in socially and environmentally responsible enterprises that create and sustain decent jobs and/or enable the availability of basic services and goods to reasonable prices in FCA’s countries of operation. We conduct due diligence for investee companies to map out the risks involved in the activities of enterprises, and to ensure their accountability.

The loan or private equity mezzanine finance is used for businesses that create jobs, increase the income of low-payed employees and reduce poverty. FCA has supported women entrepreneurs in its earlier projects, and in FCA Investments, we seek to support the employment of particularly women and youth.

Our organisation is designed to invest in enterprises that have existed for at least two years in the targeted countries. Investments in newer enterprises can however be considered if investments of tens of thousands of Euros have already been made in a business plan and the start of the enterprise, and if its activities significantly fit into the goals of FCA Investments. These kinds of investments have usually already received funding for preparing their business plan (for instance from Finnpartnership). We do not specifically search for enterprises with links to Finland, but there is no harm in such links. However, the enterprise itself has to operate in the target country.

The investments will not go straight to the poorest people, but to entrepreneurs, who employ people. This will ultimately lead to an improvement in the lives of families. When the situation gets better in a community, it means in most cases that the poorest benefit as well. Development cooperation and investment activities can achieve a lot through cooperation. This is why we think it is important that there are investment companies owned by organisations working with development cooperation among other investment companies. FCA’s presence in its countries of operation and its understanding of conflicts adds value to FCA Investments.

FCA Investments seeks to find investment opportunities also in the fragile countries. This would positively affect the lives of thousands of people in the most fragile countries, which are in the risk of being left behind.

Yes. As a part of the investments and due diligence, FCA Investments evaluates capacity building needs for enterprises. FCA Investments has developed “chief financial officer” CFO as a service with which we can support and develop the governance and financial administration of companies.

In addition to governance and financial administration, FCA Investments and FCA can support enterprises with things related to for instance planning and marketing of the enterprise. FCA has a lot of experience from arranging vocational education and bringing Finnish secondary education exams to developing countries. Enterprises can receive support from FCA’s own experts as well as from business professionals, who donate their skills on a voluntary basis.

FCA Investments plans to make its first direct investments in Uganda. In addition to Uganda, FCAI plans direct investments in Somalia, Kenya, Jordan, Nepal, Myanmar and Cambodia.

FCAI’s investment manager, who will be based in Uganda at the beginning of 2019, will have the main responsibility to prepare investment proposal for the investment committee.

In the early stages, we will also invest in the ICCO initiated fund, which invests in small and medium sized enterprises in Indonesia, India and the Philippines. These countries also experience the challenge of the missing middle, where small and medium sized enterprises that create jobs do not get enough funding.

Investments in small and medium sized enterprises usually involve such risks that it is complicated for them to find funding. FCA Investments responds to this need.

All profit is used to secure the continuity and expansion of operations. The profit is used to cover the interest of the loan that the Ministry for Foreign Affairs has granted FCA Investments (0,5 percent annually), the administrative costs of operations, and it consider as a risk buffer in case of credit losses. Working in fragile countries means greater risks for which FCA Investments prepare through searching for protection mechanisms used by international financial instruments. If country specific risks do not realise, we expect a profit of at least 2 percent (in euros) for the money we administer.

The funding for FCA Investments is priced according to the local market, because we cannot disturb the financial markets by giving finances to significantly lower prices than other actors. FCA Investments can still be more flexible than banks with for instance collateral requirements.

Accountability and quality are core principles in FCA’s work and FCA has received the respected international CHS (Core Humanitarian Standard) certificate for its work. FCA Investments also works responsibly and, as an investor, follows the Environmental, Social and Governance (ESG) criteria of IFC, which is supported by the World Bank among others.

FCA Investments demands that enterprises we invest in follow local legislation. In addition, the CFO as a service that we have developed will assist enterprises to develop their administration.

We are preparing an Environmental, Social and Governance (ESG) policy that defines the quality standards of FCA Investments and the demands for environmental, social and good governance measures from enterprises.