PRIVATE SECTOR DEPARTMENT 1 Franchising as an instrument for the ADB for SME development M. Bourenane Enterprises Support Service Division Manager

PRIVATE SECTOR DEPARTMENT 2 I.SMEs and economic development II.Franchising as an SME development tool III.Franchising in Africa IV.Franchising and the ADB V.Some Concluding Remarks

PRIVATE SECTOR DEPARTMENT 3 I.SMEs and economic development over 90% of private businesses are SMEs main generators of employment contribute to a more equitable distribution of income contribute to local and regional development promote a culture of entrepreneurship and other business- related skills due to their low entry barriers In Africa, SMEs generally lack technological and managerial capacities, leading to high failure rates

PRIVATE SECTOR DEPARTMENT 4 Job creation: direct and indirect jobs Wealth creation: contribution to poverty reduction Skills transfer and business linkages Improvement in standards and quality Generate entrepreneurship Franchising has a significantly higher rate of success than independently run SMEs II.Franchising as an SME development tool

PRIVATE SECTOR DEPARTMENT 5 Evidence of the Existence of Franchising Adequate Environment to Support Franchising Varying degrees of franchise activity were found to exist in 22 African countries III.Franchising in Africa

PRIVATE SECTOR DEPARTMENT 6 Factors that affect the development of franchising in African countries: General enabling business environment Population and market size Proximity to larger franchising nations Level of urbanisation Literacy rates Corruption

PRIVATE SECTOR DEPARTMENT 7 Constraints to the development of franchising: Poor awareness by the different stakeholders Lack of financing available No specific franchising regulation Disinformation as to existing business opportunities Little private sector involvement and support

PRIVATE SECTOR DEPARTMENT 8 ADB LEGAL AND REGULATORY INITIATIVES INTERNATIONAL MARKETING AND AWARENESS INITIATIVES CAPACITY BUILDING INITIATIVES FINANCING PROGRAMMES Franchising and ADB: Main axes of intervention

PRIVATE SECTOR DEPARTMENT 9 Sponsor and participate in Franchising Seminars and Conferences Awareness Creation: Research and Publications INTERNATIONAL MARKETING AND AWARENESS INITIATIVES MOROCCO EGYPT SOUTH AFRICA NIGERIA JAI Seminar (TUNIS, CAIRO) Franchising Toolkit Franchising Report

PRIVATE SECTOR DEPARTMENT 10 CAPACITY BUILDING INITIATIVES Technical Assistance Programme: FRANCHISE ASSOCIATIONS MOROCCO EGYPT Non-regional Franchise Associations Other Local and International Experts Franchise Association of Southern Africa Network of African FRANCHISE ASSOCIATIONS

PRIVATE SECTOR DEPARTMENT 11 FINANCING PROGRAMMES FIRST PROGRAMME to finance franchisees in South Africa ROLL OUT OF THE PROGRAMME SADC ? Morocco Egypt???

PRIVATE SECTOR DEPARTMENT 12 Last year’s seminar an overview: Franchising as business format Status of franchising Challenges Role of private sector and its support institutions Access to finance Policy and regulatory issues International versus indigenous franchising

PRIVATE SECTOR DEPARTMENT 13 This year more in-depth and new topics: Franchising associations Self-regulation Laws and regulations Business development services for franchisees Regional franchising development through indigenous and international franchising

PRIVATE SECTOR DEPARTMENT 14 IV. Concluding Remarks 1.Franchising can have positive development impact in Africa 2.Potential should be assessed with a medium to long term perspective 3.Important to bring all stakeholders together to address existing constraints with a Public-Private Partnership approach 4.ADB can play facilitative role along with other stakeholders