About the EAEF
The Egyptian-American Enterprise Fund will identify and address gaps in financing markets for entrepreneurs and small businesses and demonstrate to investors the potential for profit by creating opportunity for the private sector to flourish. In addition to investing capital profitably – which can have important demonstration effects – the Fund will promote and disseminate international commercial best practices in Egypt. This is a model that was pioneered in Eastern and Central Europe in 1990s with considerable success.
The United States efforts to promote a stronger business climate for SMEs in Egypt are best achieved in cooperation with strong partners. Just as prior Enterprise Funds successfully created parallel private investment funds to co-invest in investment opportunities, the Egyptian-American Enterprise Fund will create similar funds to attract sovereign and private investment. Sovereign governments can play a critical role in facilitating co-investment by offering to match U.S. Government funds and by making introductions to local private investment pools that may also be interested in co-investment opportunities.
GOAL OF THE ENTERPRISE FUNDS
- Broaden the range of goods and services offered in host countries
- Introduce modern technologies
- Attract new foreign investors to local markets
- Develop capital markets in host countries
- Support and train local managerial groups
- Improve social responsibility of business and legacy activities
IMPACT OF THE ENTERPRISE FUNDS
The Enterprise Funds are one of the very few development programs to achieve sustainable economic development impacts while leveraging additional investment resources, generating significant program income to endow long-term host country Legacy Foundations, and ultimately returning a significant portion of their original grant funds to the U.S. Treasury.
The following is a summary of the substantial economic and development impacts provided by the Funds as of September 30, 2012:
- $1.2 billion of USAID/USG funding has been invested into enterprise development in 19 countries
- $1.7 billion of net proceeds realized from successful investments have been reinvested by the Funds allowing them to leverage the use of their initial funding
- $6.9 billion of private capital was raised from outside the USG, based on the convincing value proposition of the Funds
- A total of $9.8 billion in capital was raised from all sources over the life of the Funds
- Significant development capital was provided to SMEs and entrepreneurs operating in early-stage transition countries where private investment capital was limited or non-existent, which helped create an environment where the culture of private enterprise could flourish
- Over 300,000 jobs were created or sustained through investment and development activities