Sri Lanka, UNDP launch social impact funds to support small businesses
ECONOMYNEXT – Sri Lankan small firms and micro enterprises whose goals include ending poverty and environmental protection will be able to get money and management support from two social impact funds with total capital of US$25 million launched Wednesday.
The US$ 5 million Social Enterprise Fund (SEF) and US$ 20 million Social Impact Capital Fund (SICF) are aimed at helping developing countries achieve the 2030 Agenda for Sustainable Development, a United Nations Development Program (UNDP) statement said.
The agreements to set up the island’s first social impact funds by the Lanka Impact Investing Network and Tempest P E Partners, a member of the Capital Alliance Group, in collaboration with UNDP, were signed in New York at a special side event, at the 73rd session of the United Nations General Assembly.
UNDP will be responsible for impact measurement and management of the projects for both funds, to ensure they are well aligned with the SDGs and achieve significant social impact.
The Sustainable Development Goals are aimed at ending poverty, protecting the planet and ensuring peace and prosperity for all, by 2030 but will cost between US$5 – US$7 trillion, with a funding gap of about US$2.5 trillion in developing countries.
“Given these global and national pressures on funding, Sri Lanka is keen to explore alternative and innovative means of financing, particularly by leveraging the private sector, to help meet the SDGs,” the statement said.
“Given that micro, small and medium enterprises (MSMEs) form the backbone of the Sri Lankan economy, and the country’s growing awareness and interest in impact investing and social entrepreneurship, impact funds were identified as a means of mobilizing funding for the SDGs in Sri Lanka.”
“UNDP is committed to helping countries to achieve the SDGS. These social impact funds will play a key role in that mission, by supporting social entrepreneurship in Sri Lanka,” said Haoliang Xu, UN Assistant Secretary-General, and Director of UNDP’s Regional Bureau for Asia and the Pacific.
“Together with the establishment of the funds, UNDP is committed to supporting Sri Lanka further leverage innovating financing models to realize the vision of a sustainable future by 2030.”
The SEF will cater mostly to successfully incubated, commercially viable, micro and small social enterprises with capital requirements of less than 100,000 dollars.
The fund will also provide targeted technical and capacity development support through mentorship, business support and training.
The SICF will support inclusive and responsible businesses that integrate and promote social impact, as a part of their business models, with investments will be larger, in excess of 100,000 dollars.
(COLOMBO, 27 September, 2018)