The International Trade Centre (ITC) and UN Capital Development Fund (UNCDF) sign a Memorandum of Understanding (MoU) to unlock financing for small businesses, with a focus on women’s economic empowerment, youth entrepreneurship and supportive business ecosystems.
Photo Credits; IFAD/GMB Akash
(Geneva) The International Trade Centre (ITC) and the UN Capital Development Fund (UNCDF) today strengthened their partnership to promote sustainable finance solutions for micro, small and medium-sized enterprises (MSMEs). ITC and UNCDF will focus on supporting businesses in frontier markets, emerging economies and least developed countries.
The heads of the two organizations signed a Memorandum of Understanding in Geneva, Switzerland, on the sidelines of the Building Bridges Summit, which aims to advance sustainable finance in Switzerland and across the globe. The organizations will work together to unlock finance for MSMEs to help advance the UN Sustainable Development Goals.
Priority areas include women’s economic empowerment through access to innovative financing, investment and markets; support of youth entrepreneurship, employment and vocational skills through investments and technical assistance; and boosting MSMEs’ ability to compete in local, regional and global markets. This last area will focus on innovation, digitalization and private sector development.
“Lack of access to finance is one of the top challenges that small businesses face – and that’s especially true in developing countries,” said Pamela Coke-Hamilton, ITC Executive Director. “Through this partnership with UNCDF, we’re targeting that challenge, so women and young entrepreneurs across the world have a chance to grow their businesses and enter new markets.”
“UNCDF and ITC have already been partners in the areas of youth economic empowerment, confronting climate change and impact investment. This MoU is a natural extension of our previous work and we are proud to work so closely with our sister UN entity,” said Preeti Sinha, Executive Secretary of UNCDF. “MSMEs are not only recipients of sustainable finance. They can also be engines of sustainable finance as well; for youth, for women, and for communities in frontier markets, emerging economies and LDCs. ITC and UNCDF are each distinctly capable of supporting Member Countries on their pathways to the SDGs. Together, we will make sure that impact capital for development will be on full display.” The partnership looks to leverage the economic and financial capabilities of two United Nations entities. ITC supports sustainable and inclusive development by boosting the competitiveness of MSMEs, placing trade-led growth at the centre of public policy and building supportive business ecosystems in developing countries. For more information on innovative ITC partnerships, such as this one, see the ITC Partnerships4Purpose webpage.
UNCDF will leverage its singular role in the UN Development System as a hybrid development agency/development finance institution, offering a suite of finance capabilities, including grants, technical assistance, loans, guarantees, bonds and blended finance instruments.
Other areas of collaboration include supporting the UN Sustainable Development Cooperation Frameworks, which are instruments to plan and implement UN development activities at country level. ITC and UNCDF will also engage in joint resource mobilization efforts, especially at country level, to boost development support and investments in MSMEs.
UNCDF’s financing models work through three channels: (1) inclusive digital economies, which connects individuals, households, and small businesses with financial eco-systems that catalyze participation in the local economy, and provide tools to climb out of poverty and manage financial lives; (2) local development finance, which capacitates localities through fiscal decentralization, innovative municipal finance, and structured project finance to drive local economic expansion and sustainable development; and (3) investment finance, which provides catalytic financial structuring, de-risking, and capital deployment to drive SDG impact and domestic resource mobilization.
This article was originally published on Mailchimp.