The GER Initiative Update
CHF International

SO1: PRIVATE SECTOR-LED ECONOMIC GROWTH
posted by Skip Waskin on Monday, March 27, 2005, 2:39AM

In February, 87 businesses were improved or expanded, 11 new startups were created, 84 people were matched to jobs, and 71 new job placements were generated. CHF has focused on business monitoring over the past two months and has found that many job placements were generated due to business expansions.

Training and Consulting. The level of vocational training and business consultancies expanded significantly in February. This month training and consultancies were provided in restaurant hygiene, pig production, knitting design, felt, carpentry, chicken farming, composting and greenhouse construction by one international and seven local consultants. In Choibalsan, in coordination with a local project from the Khan Uul School, GER provided business planning training to 20 clients following which 12 of those clients successfully applied for no interest start-up loans with money provided by the Australian Embassy through a VSO volunteer. In total, GER provided consulting services to 336 clients and business training to 378 clients this month.

Financial Services. GER facilitated 96 loans worth $79,658 in February. This includes 12 Capital Augmentation Fund (CAF) loans worth $7,416. The average loan amount was $837, with an average term of 10 months. To date, GER has facilitated 3,119 loans valued at over $2.9 million, including 421 CAF loans valued at over $295,000. As of the end of February, 22 of the 705 outstanding facilitated loans in the portfolio are in arrears, and 7 of 185 outstanding CAF loans in the portfolio are in arrears. For the life of the project, there are five defaults in facilitated loans, and one defaulted CAF loan.

Information. In February, 338 clients accessed information services. In Darkhan, GER met with the director of the Land Office to discuss land privatization outcomes. According to GOM records, 61% (3362) of the 5,551 eligible households have privatized their land. In March, a Land Office official will attend a ger resident meeting to answer the questions of those who have not yet privatized. The UB Bayangol branch organized a workshop in Chingeltei 9th khoroo (neighborhood) where many people have problems with land. Around 50 people participated in the event. A big argument arose because, according to the city plan, this area is to be “Ger Area Free.” The plan is that new apartments or buildings will be built in this area. Right now, over 100 people live in single family housing units there. They do not know what will happen to them under the new plan. The Land Officer is not responsible for the plan and could not respond to the people’s complaints. In UB, GER has identified more than 20 clients who have unsafe electrical wiring. Project staff are working on getting an electrician to assist clients in remedying their problems before they have a fire.

Linkages. Input and sales linkages were down this month. There were 29 companies purchasing goods and services from forty six GER clients. The total value of sales linkages was $5,303. New sales linkages were made with LLX Mongolia, Bayangol Hotel, Western Prospectors, and the Darkhan Metallurgical Plant (DMP). The DMP will purchase work gloves and brooms from GER clients on an ongoing basis. Their first order consists of 4,000 pairs of gloves and 100 brooms. Twenty one companies were involved with input linkages for the month and 51 GER clients benefited from these relationships. The total estimated savings to clients was $1,142. GER has facilitated input linkages with Coviin Tulsh, a coal company, Altan Taria, and Boroo Gold. Boroo Gold provided a Darkhan carpentry client with 120 metal barrels.

GER has received three requests in the past few months from Americans who want to sell Mongolian slippers in the U.S.. In response, project staff finished a draft ‘Export Guide’ which explains costs and customs regulations for shipping GER Initiative clients’ products to foreign countries. GER also completed a catalog which has information about clients’ products and handicrafts. As the number of trade fairs in which GER clients are invited to participate is increasing, project staff also wrote a draft Exhibition and Trade Show Policy with post-event evaluation.

Business Associations. GER provided 37 different types of services to 33 business groups, involving 206 people. There are 38 active business groups that are working with the GER Initiative including two new groups in Ulaanbaatar. In Ulaanbaatar, 28 stove producers created an NGO called the United Association of Mongolian Stove Producers. Their goals are to share resources to reduce stove emissions, improve quality standards, and improve heat efficiency. The Darkhan Soum Governor held a meeting of pig farmers after visiting one of the members of the Pig Farmers Association that the GER Initiative helped establish. Thirty three members of the Pig Farmers Association attended as well as the Food and Agriculture Department, the Darkhan Meat Factory, Veterinary Companies, the Households Sustainable Living Project, and the GER Initiative. GER Initiative staff gave a presentation about their activities in pig farming and business association development. Representatives of the Pig Farmers Association explained the farmers’ problems and the current situation of the Association. The Darkhan Soum Governor promised that the Soum will work closely with the Association and will provide financial support for the Association’s rent and manager’s salary for one year.

Employment Services. GER matched 84 clients with employers in Feburary. GER established new relationships with nine companies, including BSB Electronics. In Erdenet, GER began working with the Israel-Mongolia Joint Molybdenum Company and matched an accountant to this Company. Project staff hope to expand this relationship and, through it, to begin working with the Erdenet Copper Mine. This month, 17 of the 19 GER clients that have been placed at the Erdenet Carpet Company as apprentices will become full time employees. Based on this result, the Carpet Company hired 10 additional GER clients.

Comparing GER employment data for 2004 (1464 people placed in jobs) to 2005 (1661 people placed in jobs), average starting salaries increased 2% overall from 52,137 MNT to 53,321 MNT (about $45) a month. By city, in Darkhan salaries increased 4% (46,779 to 48,591), in Erdenet 5% (47,954 to 50,450), and in Ulaanbaatar 11% (66,367 to 74,875). Salaries fell by 4% in Choibalsan (41,169 to 39,368).

The GER Initiative Update
CHF International

SO1: PRIVATE SECTOR-LED ECONOMIC GROWTH
posted by Skip Waskin on Wednesday, March 1, 2005, 8:10PM

In January, 77 businesses were improved or expanded, 7 new startups were created, 97 people were matched to jobs, and 55 new job placements were generated.

Training and Consulting: GER provided 398 clients consulting services and 239 clients business training this month. Over half of the consulting clients are now ongoing clientele that receive more than one consultancy from the project. Twenty-five percent of the consultancies were marketing; many were done in preparation of the trade fairs in Choibalsan and Erdenet. Consumption and Savings remains the most popular training. Two special consultancies were provided this month: a follow up to the restaurant training and an oven brick making consultancy.

Financial Services: GER facilitated 92 loans in December worth $73,172, while seven Capital Augmentation Fund (CAF) loans were disbursed worth $2,828. To date, GER has facilitated 2,607 loans valued at over $2.8M and disbursed 407 CAF loans valued at over $350,000. As of the end of January, 39 of the 918 outstanding facilitated loans in the portfolio are in arrears, and 12 of 186 outstanding CAF loans in the portfolio are in arrears. For the life of the project, there are five defaults in facilitated loans, and one defaulted CAF loan.

In January, CHF signed a new agreement with its fifth bank partner, Capitron Bank. Interest rates to GER clients are set at a maximum of 2.7% a month. CHF is in discussions with our four other financial partners regarding their interest rates and already two - Savings Bank and Xac Bank - have lowered their interest rates to meet Capitron Bank’s rates.

Information: In January, 323 people accessed information services from the project. Meetings with Land Office authorities were held in three branches in Ulaanbaatar, and 55 people who were having problems attended the meetings. Many were able to get the answers they needed at the meeting. CHF is collecting all the problems that were discussed as well as the solutions to the problems and will print a small booklet for its offices as well as the local government administrative units for use for people who have problems in the future. CHF hopes to begin having similar meetings in Darkhan and Choibalsan. After meeting with all khoroo governors in Ulaanbaatar, GER now has more clients coming to its offices referred to it by the local government unit. Tolgoit khoroo governors are now having “heseg” (neighborhood appointed) leaders deliver the project newsletters to the businesses in their areas. Two khoroo governors have asked CHF to provide services at their offices.

Linkages: Linkages continue to expand in GER programming. This month there were 30 sales linkages. The total value of the sales was $15,700, up from $8,000. Twenty-six clients were involved with these linkages. New sales linkages were established between GER clients and with Altan Zul Tsetsg LLC, Alifa LLC, Olikhon supermarket and the UNDP. GER is in discussions on providing work gloves to the Darkhan Metallurgical Plant, as well as on expanding its agreement to provide ger furniture to the Ger Tereg Company for export.

CHF also facilitated 25 input linkages, benefiting 68 clients, who saved approximately $860. One of the new input linkages that GER organized is between two major soft drink and juice producers (Vitafit and Monfresh) and 50 grocery stores in the Ulaanbaatar 4th bus stop branch area. Due to the large number of retail grocers purchasing together, the large producers are willing to distribute to the area. GER staff are surveying retail grocers in other Ulaanbaatar Ger Areas to see if there is interest in organizing the same type of activity in their areas.

GER held two Tsagaan Tsar trade fairs in Erdenet and Choibalsan. In Erdenet, 68 producer clients participated, with total sales of $3,934. The Orkhon Aimag Governors Office and Khan Bank sponsored the event. In Choibalsan, 36 clients and 7 larger partner businesses participated, with total sales of $5,840. The fair was organized by CHF and sponsored by Khan Bank, Zoos Bank, the Business Incubator, and the Dornod Employment Office.

Business Associations: GER advisors provided 58 services to 22 business groups and 127 people. Twenty groups had sales of $14,000 this month. In Darkhan, GER organized the second vegetable growers meeting, and 24 vegetable growers participated. Vegetable growers are formalizing as groups to share costs and improve their opportunities to sell products in larger markets. The 24 farmers divided themselves into three groups and identified their preliminary needs, including seeds and technical and business trainings.

In Ulaanbaatar, four new business groups are being formed, including a taxi service, a tailoring group, a wool processing and wool products group and a chicken raising group. GER and the Norwegian Lutheran Mission (NLM) agreed to cooperate to support NLM-trained felt producers to become business groups. NLM is a NORAD-funded NGO and has been implementing a wool project in Mongolia since 1997.

Employment Services: In January, 155 clients participated in employment and vocational training. UB Tolgoit branch office organized an Open Technical-Vocational day to encourage young people to study and have a profession. Sixteen people chose professions and were introduced to training centers, such as Gobi, Mongolian Cashmere and Camel Wool, Ezio Foradori, Mongolian Builders Association, Ireedui and Abuka.

The UB Bayangol branch was awarded second place as a best employer – or organization that works to decrease unemployment in the District – by the Bayangol District Employment Office. (Power Station #4 won first place.) Authorities of the office said that CHF is one of the few NGOs that cooperates closely with the goverment to improve goverment services for the benefit of citizens. Sewing factories, hospitals, service and trade companies, and training centers were also nominated.

Other: The new Ulaanbaatar Mayor, Mr. Batbayar, visited GER’s Ulaanbaatar Yarmag branch office with the U.S. Ambassador and met with seven clients from the area. The clients shared brief information about their businesses and discussed their difficulties in operating small businesses.

The GER Initiative Update
CHF International

SO1: PRIVATE SECTOR-LED ECONOMIC GROWTH
posted by Skip Waskin on Thursday, January 26, 2005, 4:17AM

In December, 71 businesses were improved or expanded, 10 new startups were created, 134 people were matched to jobs, and 54 new job placements were generated. The GER Initiative also carried out an assessment of the 118 businesses that were started last Fiscal Year. Of those, 85 are still operating.

Training and Consulting. GER provided consulting services to 340 clients and business training to 186 clients this month. Based on the needs of restaurants and cafes in Ulaanbaatar, a restaurant consultant organized a half day basic hygiene training the covered the requirements of the Professional Inspections Office. 19 people participated in the training. The project continues to train VET Net’s veterinarians, and last month, 19 clients received bookkeeping training. GER Initiative staff also continued the project’s collaboration with the GTZ carpentry project, and seven carpenters received advanced consultancy.

Financial Services. GER facilitated 112 loans in December worth $124,830, and 34 Capital Augmentation Fund (CAF) loans were disbursed worth $17,037. As of the end of November, 16 of the 714 outstanding facilitated loans in the portfolio are in arrears, and nine of 177 outstanding CAF loans in the portfolio are in arrears. For the life of the project, there are five defaults in facilitated loans, and one defaulted CAF loan.

In December, 18 members of Darkhan Noos– a felt cooperative - received CAF loans for working capital and equipment totaling $8,374. A major fire in the Bumbugur trade market affected five UB GER Initiative clients with outstanding loans. Two of them are CAF loans with an outstanding value of $786. CHF is working with partner banks to restructure their payments. Project staff are also monitoring 10 GER clients who have loans and are operating their businesses in the buildings adjacent to the site of the fire. They also may have trouble paying back their loans on time if customers stop going to their businesses.

Information. In December, 291 people accessed information services from the project. In Ulaanbaatar, the project organized a meeting with the District Land Authority and GER clients in the Dambadarjaa office. Fourteen Ger Area residents participated. The Land Authority Officer answered many questions regarding the privatization of land, and promised to resolve land issues of two clients. In Erdenet, project staff met with the Local Land Department, which expressed interest in working with the GER Initiative to improve public awareness of how to obtain real estate and immovable asset certificates.

In Erdenet, GER conducted an information session to identify the type of assistance needed by young adults who want to start their own businesses but lack skills and knowledge. Eight people ranging in ages from 18 to 31 participated in the two hour session. As a result, new clients were registered and matched with GER advisors, and specific trainings based on their feedback and requests are being planned. In Ulaanbaatar, all branches organized meetings with their khoroo (local) government offices in December to share the achievements of the project in their areas and to discuss issues and activities the project and the local government can work on jointly.

Linkages. Last month, the GER Initiative facilitated 18 sales linkages worth over $8,000, as well as 53 input linkages with an estimated value of more than $2,000. GER initiated relationships with two new mining companies: Red Path Mining and Engineers and Western Prospectors, as well as Bishrelt Trading. The GER Initiative organized an Artisan Holiday Fair on December 2-3 with Ekh San – a local artisan NGO. Khan Bank, Mongolian Women’s Federation and Leos sponsored the fair. 32 clients participated with sales of $1,465.

Business Associations. In Darkhan, 54 vegetable growers participated in a planning meeting to improve their businesses by basing their production on the demands of the customer and working in groups. GER Initiative business and agricultural advisors introduced the following ideas to improve their sales next year: a vegetable needs survey to identify types of vegetables that could be sold in the more affluent UB marketplace with little competition from Chinese products; selling production to pig farmers and herders in the area; possibilities and limitations of growing in Mongolian soil and climate and approximating profit calculations before planting. The advantages of working in a group were also discussed, and two successful vegetable groups shared their experiences. Seven upscale Ulaanbaatar restaurants participated in the survey that demonstrated a strong demand for “exotic” vegetables. The group will continue to meet monthly to discuss what to grow and how to ensure a good harvest. The Erchim (yak hair rope group) business group has received an award from the Chamber of Commerce as one of the ten best microbusinesses in Orkhon aimag.

Employment Services. This month, 259 clients participated in employment and vocational training. In Ulaanbaatar, GER continues to work closely with the Mongolian Builders Association Training Center. 14 GER Initiative clients have trained in that center and obtained jobs, and 22 more are being trained. Last month, the training center held an orientation session for GER advisors to explain what types of professions they train in, what are the advantages of their center, and what they are looking for in a trainee. 20 GER clients are training at the Mongolian Cashmere and Wool Company to become knitters and assemblers, and 22 clients are receiving vocational training in a variety of professions through the Sukhbaatar Employment Office. In Erdenet, 21 GER clients are working at the Erdenet Carpet Company as apprentices after finishing a short training course. The apprentice period will last three months.

Other. U.S. Embassy Deputy Chief of Mission Brian Goldbeck and Commercial Officer Michael Richmond visited the GER Initiative offices in Erdenet and Darkhan. During their visits, they met with GER staff as well as various clients at their worksites to observe the progress of their small businesses.