When Marie Diongoye Konaté first encountered ITC at an
exporters' association meeting in Bamako, Mali, in March 2005, she
was very much struck by the "Buying from Africa for Africa"
initiative it was promoting. It was an idea to which Ms Konaté
wholeheartedly subscribed. It was also a primary motivation behind
Protein Kissèe-La (PKL) S.A., the Côte d'Ivoire food processing and
trading company that she set up in 1994 and of which she is
currently Chairman and Chief Executive Officer. The company is
located in the Vridi industrial zone, near the port and airport of
Abidjan.
Ms Konaté's story seemed to provide a useful model of how the
Buying from Africa for Africa initiative could work in practice.
She had already gained experience of making available emergency
supplies to relief agencies through her work with the European
Commission's ECHO programme and French non-governmental
organizations Action Contre la Faim and Médecins sans
Frontières. So ITC invited Ms Konaté to share her experience
with other Africa-based firms and international relief agencies
during an ITC-organized buyer-seller meeting held in Dakar,
Senegal, later the same year.
The Dakar event proved to be a turning point for PKL, with each
agency given the opportunity to define its contracting requirements
and each firm the possibility to present its products, while ITC
provided on-the-spot back-up documentation and information for
participants. According to Ms Konaté, immediate direct benefits for
PKL included meetings with ten buyers from the aid agencies, having
her company listed on agency databases and gaining valuable
insights into supplying food aid for the African market.
African firms can supply quality products that meet
international satandards.
© PKL
Since then, PKL has won seven invitations to tender in a period
of 11 months. It also supplied some 5,000 tonnes of food aid to the
World Food Programme (WFP), valued at €1.8 million, of which €1.1
million has been returned to the local communities in payment for
raw materials, with other spin-offs including €200,000 for services
such as transport and €20,000 in PKL regular employees' and daily
workers' salaries. Further, the WFP contracts have provided direct
benefits to hundreds of local farmers and indirect benefits to some
80,000 people in local communities.
According to Ms Konaté, for each €100 of food purchased by the
WFP, €60 was returned to the local rural economy and the remaining
€40 to the national economy. She says the real strength of the
Buying from Africa for Africa initiative is to guarantee local
firms' long-term economic viability, allow them to create jobs,
train staff, develop their activities and customer base and have a
positive impact on the quality of life of local communities.
Barriers to local sourcing
Aid agencies agree that buying goods and services through local
field offices makes good business sense because it lowers
transaction costs and shortens delivery times. Currently, however,
local sourcing accounts for just 10% of the total humanitarian aid
in Africa. PKL's Marie Konaté says constraints exist within the
system, not least the prejudice against local products and the
difficulty in gaining direct access to aid agency decision-makers.
She says this is why it is important to get to know ITC's Buying
from Africa for Africa initiative and its buyer-seller meetings.
"If I'd known ITC sooner, I would probably have added five years to
my life," she says.
Once a firm becomes an established agency supplier, the
likelihood of getting further contracts increases significantly.
Even then, cautions Ms Konaté, the contracts themselves often
reveal little understanding of local conditions and often stipulate
unrealistic conditions, for example, a caution of 100% of the value
of the contract and payment upon delivery - if not 30 to 60 days
after delivery!
"Get real," says Ms Konaté, "this is the Third World. We don't
have that kind of money to pay up front. And I can't see myself
asking my local growers to give me six months' credit on the
produce they are delivering today until the agency pays me. Can you
imagine me asking a poor farmer to wait six months to be paid?"
Get-togethers with the aid agencies, for example at ITC
buyer-seller meetings, provide an opportunity to debate such
issues.
For their part, says Ms Konaté, local suppliers should, in their
international contacts, behave with professionalism, reject
corruption and only offer what they are in a position to supply.
They should not cut corners on quality and should make known in
good time any difficulties in executing the contract and be ready
to replace any non-compliant product immediately. Further, she
says, it is essential to have good management practices (her own
company is ISO 9001 and 2 certified), respect national and
international laws (for example, not employing child labour) and,
above all, be loyal to suppliers, employees and partners. In this
way, local firms in Africa can become valued partners in the effort
to provide relief aid.
"When you start from the idea that people have nothing," says Ms
Konaté, "ensuring that part of the costs of a programme are spent
in Africa is already a contribution to development. The
opportunities are there but you need motivation, perseverance and
energy."
Trading with the aid agencies
Every year, the United Nations spends $3.6 billion in aid in
Africa alone. It buys just 10% of supplies locally. Many agencies
are trying to reform their procurement practices to buy more from
local firms, but they can have trouble finding the right suppliers.
ITC matches suppliers of aid items with international aid agencies
through programmes such as Buying from Africa for Africa. These
contacts and resulting sales help firms gain experience in
transacting with international buyers who require high standards of
service. Since 2001, ITC's buyer-seller meetings in this programme
have generated new business worth about $35 million between
international agencies and firms.
For more information about the Buying from Africa for Africa
programme, contactbetemps@intracen.org
Christopher Simpson, ITC consultant, interviewed Marie
Diongoye Konaté during ITC's annual meeting in April 2006, when she
helped present its poverty-reduction programmes to
stakeholders.