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Good practice examples of developing local SMEs and opportunities for local business to become part of the supply chain

Good practice examples of developing local SMEs and opportunities for local business to become part of the supply chain. Experiences of the Linkages Program in Cajamarca. María Cecilia Araujo M. Washington D.C., June 19th 2006. Cajamarca: General information. Source:

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Good practice examples of developing local SMEs and opportunities for local business to become part of the supply chain

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  1. Good practice examples of developing local SMEs and opportunities for local business to become part of the supply chain Experiences of the Linkages Program in Cajamarca María Cecilia Araujo M. Washington D.C., June 19th 2006

  2. Cajamarca: General information Source: INEI: 1994, 2002, 2005. Minag: 2004

  3. Potential effects of large scale mining in Cajamarca: role of the Linkages Program

  4. Linkages experience: Suppliers development project Some facts: Number of assisted SMEs: 119 Number of employments involved: 506 Number of new employments generated: 35 Sales generated: US$ 12’748,755 (US$ 6’500.000 baseline data)

  5. Linkages experience: Financial access project Some facts: Number of assisted MSMEs: 82 Number of new accesses to financial system: 38 Amount of financial resources obtained: 1’033,851 US$

  6. Linkages experience: Construction project • Expocentro Pyme, a commercial linkage success for construction goods: • -Conglomeration of producers/construction goods (47 in 2003, 20 from 2004 onwards). • Effects on standardization and product differentiation. • Sales generated: US$ 33,310 during 17 months (43% of the total sales generated by the project).

  7. Linkages experience: Artisan project (Aid to artisans) • Challenges: • Product standardization: in site assistance. • Independence in the commercial relationships (exporters). • Delivery timing. • Volume of production. Some facts: Number of assisted artisans: 51 Number of employments involved: 51 Number of new employments generated: 14 Sales generated: US$ 47,912

  8. Beyond the provision of Business Development Services: • Do local governments have a role in the local economic development? • Centralization problem in Peru. • Modernization process, including the Local Economic Development promotion role. • Capacity building requirements of local governments. Case: Business licensing in Cajamarca. • Development of other income-generating opportunities. • Mining activities complementing the development of tourism supply chain. Case:Tourist development in Huaraz and the involvement of Cía Minera Antamina.

  9. Business licensing in Cajamarca • Problems generated: • - Increment of informal business. • - Decrease of Municipal revenues. • - Restriction to SMEs growth (legal • status, with market value). • - Corruption • Baseline data: • Estimated time: 100 days. • Monetary cost: US$ 163. • Perspective: • Implementation of a web server • system • (local municipality, public registers • and SUNAT). • Solution proposed: • - “One-stop-shop” centralized location. • - Development of an electronic • government portal. • Linkages Program contribution: • Technical assistance for analysis and • redefinition of processes. • - Follow up. • Results: • Estimated time: 3 days. • Monetary cost: US$ 140

  10. Sustainable tourism in Huaraz: Gestur • General information: • Ancash is a region with a • population of 1’039,415 (70% of • poorness incidence). • Limited use of tourist resources • (Huascarán, Huayhuash). • Presence of high scale mining • activities (Cía Minera Antamina). • Gestur strategy: • Alliance with the regional • actors (mining company vg). • Technical assistance to • Local governments • (implementation of tourism • development plans). • Alliance with tour • operators. • Articulation to BDS • providers. • Gestur project: • -Incorporation of rural population in the • supply chain of tour operators • (through BDS provision). • Development of new alternative • tourist circuits (rural approach). • -Improvement of the business • environment.

  11. Lessons learned: • Joint definition of objectives and goals (IFC/invested company) is crucial. • A linkages program can go further than the suppliers development experience, contributing to sustainable local economic development. Sustainability of the results lies on: • Market approach of the SMEs capacity building process (linked to actual & potential market requirements, not only to the mining demand). • Contribution to the improvement of the business environment, generation of synergies with public and private sector (not conclave).

  12. Thanks for your attention We create opportunities

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