Friday, January 28, 2005
GMA witnesses turnover of $25M parallel investment fund for SMEs in Palace rites
President Gloria Macapagal-Arroyo witnessed the turnover of agreement for the $25 million parallel investment fund between Aureos Capital Ltd. and Planters Development Bank (Plantersbank), that will help provide much-needed equity financing for small and medium enterprises (SMEs) in the country.
The turnover of the $25 million Plantersbank-Aureos SME Equity Fund accord between Plantersbank chairman and chief executive officer, Ambassador Jesus P. Tambunting and Aureos Capital managing partner Liam Cully, was held in simple rites this afternoon at the Rizal Hall in Malacañang.
Aside from the President, those who witnessed the turnover were members of her new economic team including incoming Finance Secretary Cesar Purisima, incoming Trade and Industry Secretary Juan Santos, incoming Customs Commissioner Alberto Lina, and outgoing Finance Secretary Juanita Amatong.
Earlier, Plantersbank announced its partnership with Aureos Capital for the establishment of the Aureos South East Asia Fund (ASEAF) that would bring private equity investments of $25 million into the country in the next four years.
The leading manager of SME private equity funds in developing countries, Aureos Capital is a joint venture between Actis, which is partly owned by the British government through the Department of International Development (CDC Group), and the Norwegian Investment Fund (Norfund) for Developing Countries.
President Arroyo said the Philippines is not alone in its drive to provide the needed capital to accelerate economic growth through entrepreneurship, that has proven to turn economies around in the shortest possible time aside from creating more jobs.
“We thank our allies from the United Kingdom and Norway for putting up this equity fund,” the President said. She also thanked Aureos for transferring its regional headquarters from Bangkok to Manila.
Under the parallel investment fund, the first private SME equity fund of its kind in the country, Plantersbank agreed to contributed $5 million to the fund while the $20-million balance will come as direct foreign investment from the CDC group and Norfund as anchor investors in the ASEAF.
Ambassador Tambunting said the fund would provide equity financing for SMEs that demonstrate strong potential for profitable growth, employment generation, and foreign exchange savings.
He observed that many SMEs exhibit strong potentials for growth but are unable to expand their operations because of their limited capital resources.
Ambassador Tambunting also informed the President that the Development Bank of the Philippines (DBP) has agreed to join in their SME lending venture and would immediately participate once DBP has completed the regulatory approval process.
He said they hope the establishment of the SME Equity Fund would encourage not just local institutions, but also foreign investors, to establish similar equity funds to support domestic SMEs.
“Madame President, by giving stimulus to the vital, yet under-served SME sector, we hope that in our small way, we will be able to help you in realizing your economic objectives of growth and prosperity for the country,” Ambassador Tambunting told the President during the rites.
Related Article:
GMA lauds launching of first private equity fund for SMEs