By: Silvia Morimoto | UNDP Country Director in Argentina
Charming San Juan is a province of Argentina, located in the western part of the country. Like in other Argentinean regions, agriculture is one of the most important economic activities. San Juan is the second province in all of Argentina that produces the most volume of wine at the national level.
In these San Juan vineyards nestled in the shadows of fertile green hills -mostly artificially irrigated- the Malbec’s swish fresh and exotic. While their balsamic hints and mineral aromas are prized by wine lovers and earn high international ratings, winemakers struggle to make a comfortable living. Their economic challenge is felt by many across the province of San Juan and is not limited to its winemakers.
The province is also well known for its mining and regular oil production industry. Despite those rich resources, business productivity taps out at just 52 percent well below the national average. Unfortunately it seems there is significant room for improvement in business productivity- especially in terms of organic fresh vegetable agricultural export products.
In San Juan, 69 percent of the province’s economy is conducted by the private sector and 90 percent are Micro, Small and Medium enterprises (MSMEs). Supply chain members have very limited management capacities with little or no consensus regarding market development and trends. These members also falter in their consensus on s technological models used in the primary and industrial sectors as well as in the commercial sector, and no linkage and coordination among businesses in the same chain or among different chains.
What’s the solution to this complex problem?
To promote sustainable development, boosting gains in the social, economic and environmental fronts, the United Nations Development Programme (UNDP) in Argentina joined forces with IADB [Inter-American Development Bank] and the Government of the Province of San Juan in support of a productive development project aimed to increase the productivity of small and medium-sized enterprises (SMEs).
The UNDP also helped the San Juan province establish its First Investment Development Agency to facilitate access to medium and long-term credit and to improve the managerial capacity as a way of developing the investment plans of the MSMEs. The initiative focuses on expanding SMEs’ access to credit and improving their management and coordination capacity to develop and carry out sound business and investment plans. This initiative counts on National Central Bank and leading private banks´ support and has benefitted more than 1400 SMEs since 2007 through loans and to another 550 SMEs through grants.
“The United Nations Development Programme together with the San Juan Agency for Investment Development, and the Inter-American Development Bank have provided invaluable and timely support for the implementation of standards to comply with customer requirements, protocols for good practices, food safety protocols. In addition, they provided support to hire agricultural engineers, training, external consultancies; that helped us gain knowledge, and taken together with the agency’s financing programme through local banks, is what has enabled us to develop in a very difficult and competitive market.” Diego Iglesias, Director Iceberg Agrícola S.A.
Based on San Juan’s experience on how to address these challenges, the UNDP teamed up with the Argentinean government to develop a platform that promotes a social and environmental impact fund that will allow the MSMEs to access medium and long-term credit. Hopefully this does become a way to promote impact in the economic, social and environmental fronts of San Juan.
This platform will connect traditional and non-traditional partners, promote tools for strategic planning while promoting social, environment and economic impact that allows the MSMEs within the region to develop strong pipeline and project formulation. UNDP will also render support services to project implementation looking into impact measurement- supporting certification standards to verify the Sustainable Development Goals (SDG) contributions and tools. This measure will enable SDG-aligned investment at scale, risk and impact management, monitoring, audit and evaluation mechanisms and tools for more stable enterprises, increasing their productivity and profit in a sustainable way.
By promoting MSMEs’ social, environmental, and sustainable growth, we are promoting the achievement of the SDGs, to take care of the planet while improving people’s lives, making sure that no one is left behind.