USAID, Western Union program aids African business

A U.S. aid agency and Western Union Co. are teaming up to offer a cash boost to sub-Saharan Africans who live in the U.S. but have business plans back home.

The African Diaspora Marketplace program offers matching grants of $50,000 to $100,000 for small- to medium-sized business proposals that can boost the economy in applicants' home countries. Applications are due July 21.

The U.S. Agency for International Development, Colorado-based Western Union and other partners have set aside $1.5 million for the program, but the pot could grow through donations.

The program comes as the recession threatens to undo years of work fighting poverty in sub-Saharan Africa, where remittances can outstrip official development aid.

"The program is really great to encourage those of us who are outside the country to go back and invest," said Eliab Tarkghen, a software engineer in Alexandria, Va., whose family moved from Ethiopia in 1986 to escape communism.

Tarkghen, 37, declined to give details but said he is exploring applying for the program, possibly to open an assembly plant in Ethiopia.

"The way I look at it, the program is the final push if you have ideas, want to go back, but are afraid of the risk. But if someone will give you a grant and help you out, you are willing to take the risk," Tarkghen said.

Applicants must be U.S. citizens or permanent residents from one of 19 countries in sub-Saharan Africa where USAID has a presence and potential technical assistance programs. They also must have a partner in the country where they plan to go.

Eligible countries are Angola, Burundi, Ethiopia, Ghana, Kenya, Liberia, Malawi, Mali, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Sierra Leone, South Africa, Sudan, Tanzania, Uganda and Zambia.

U.S. Census Bureau figures show there are about 1.2 million African-born adults in the U.S.

By mid-June, 14 applications had been submitted to the diaspora program, and dozens more had begun the application process, USAID said. They include proposals for agribusiness, food production, fisheries, engineering, transportation and communications technologies in nine countries, according to Western Union, based in Englewood, Colo.

Members of the diaspora can face challenges finding financing in their home countries if they don't have collateral or a strong business reputation in the local community, said Yohannes Assefa, managing editor of The Ethiopian American magazine.

Alonzo Fulgham, acting administrator of USAID, said even a $50,000 grant can be significant to an entrepreneur in Africa.

While the U.S. gross domestic product per capita was estimated at around $45,000 in 2007, it was around $6,000 in South Africa, and about $150 or less for Burundi, according to statistics from the United Nations.

"We're making significant investments on health and education, but economic growth is key to providing stability in the nations we're working in," Fulgham said. "If people don't have jobs to go to, a nation can't move forward."

Tarkghen called the program a great idea.

"It's not just throwing money at the country. It's helping someone create jobs, become an engine to the economy," he said. "As opposed to giving aid and leave someone alone, you're actually making a productive citizen."

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On the Net:

http://www.diasporamarketplace.org