From shop to factory: helping ambitious young Lebanese entrepreneurs

Transcription

1 From shop to factory: helping ambitious young Lebanese entrepreneurs This is the story of Ali, who has managed to develop his shoe manufacturing business with loans from the Economic and Social Fund for Development backed by financial support from the European Union Ali has one of these gentle faces that hide a steely determination and unbound ambitions. He grew up in a crowded popular neighbourhood of Beirut where his father owned a shoe shop near the family home. Ali's eye for design and his keen interest in shoe manufacturing found inspiration in his father's shop and drove him to open a small shoe factory a stone's throw away. "My dad owns a shoe shop. This is where I got my inspiration from and this is where my decision to manufacture shoes came from," Ali says, before describing the struggle he had to deal with before receiving assistance from the Economic and Social Fund for Development (ESFD) that provides loans to Small and Medium Enterprises (SMEs) through European Union funding: "Before, we didn't have a management office, we didn't have a place to display the manufactured items, we didn't even have a current account". These factors compelled several banks to reject his loan requests.

2 That was before the 33-year-old was visited by Hossam from ESFD, who scouts for people like Ali who are struggling to develop their enterprises and secure a foothold in an increasingly competitive market. "He helped in each step along the way, from marketing to quality control, to creating a balance sheet and a portfolio". Through a low-interest loan for 50,000 US Dollars, Ali managed to purchase a new machine from China as well as raw material that has allowed him to improve the manufacturing process, lower costs by almost 70%, increase the competitiveness of his company, and create new job opportunities for his local community. But the ESFD's support is not going to be limited to providing the financial assistance. Ali will receive further help in improving the marketing aspect of his business and very soon he will make use of the funds to employ new sales representatives.

3 Hossam is full of admiration for Ali s ambitious spirit and is certain that his shoe factory will go from strength to strength: "Ali is business-oriented and very adept at improving the production process at his factory". "The positive change brought about by our support has also changed him as a person. He has become very excited but somehow impatient, as he is always dreaming of the next big step."

4 Indeed, Ali confirms Hossam's words with a nod and a witty smile, saying that the door has been opened for him to make stronger and more ambitious leaps forward. "In 10 years' time I see my business expanding abroad; I see myself building a factory abroad, maybe in China!". But he also has more concrete plans, and one of them is to open another factory in his home village outside the capital Beirut. Ali is aware that job creation schemes such as the one that ESFD provides, and the attention that Hossam has given him, are creating ripple effects across local communities in Lebanon. He is not taking the success of his business for granted and wants to transmit some of its results and some of the newly-acquired knowhow to his community, starting with his direct family. "My siblings own shoe shops and I am now able to help them improve and better manage their business," he says with confidence. "I am now able to advise them on the right way to approach their work."

5 The EU-funded Job Creation unit at the ESFD aims at facilitating access to financing and creating job opportunities by providing loans to Small and Medium-sized Enterprises (SMEs) which constitute most of the private sector in Lebanon. Financed projects cover the sectors of agriculture, trade, services, and industry, and are distributed on all the Lebanese territory. Lean procedures provide financial and nonfinancial support to SMEs for sustainable economic activities with significant impact on poverty alleviation. Since 2004, the programme has provided loans for more than 8362 projects, has created more than 5917 new jobs, has launched more than 756 new start-ups and has supported more than 1,147 female entrepreneurs. At least 2971 loans targeted the service sector, 2760 the trade sector, 1150 the industry sector and 807 the agriculture sector. Project funded by the European Union Economic and Social Fund for Development