USAID Enterprise Development Project in Central Asia

Start date: August 24, 2002

The Enterprise Development Project is a United States Agency for International Development Business Consulting project, dedicated to building capacity for Small and Medium sized Enterprises (SME’s) in Central Asia. We work with hundreds of partner organizations to maximize the reach of our client services, and we employ over two hundred staff. With our vast experience from serving hundreds of SME clients, we are able to offer practical solutions across a range of business functions. We understand business needs and we have the expertise to generate results.

The project is providing entrepreneurs with the opportunities to acquire business information, knowledge, and skills through the implementation of its seven inter-related major components: 1) Business Training, 2) Accounting Reform, 3) Business Advisory Services, 4) Regional Trade Promotion, 5) Association Development, 6) Quality Management Center (Kazakhstan only), and 7) Cross-Cutting Related Activities. The ultimate objective of the project is to enhance the productivity and competitiveness of local companies so that they will be able to compete in domestic, regional, and international markets.

The technical assistance provided by the EDP is delivered through twelve Enterprise Development Centers (EDCs) located throughout the region: 5 in Kazakhstan, 2 in the Kyrgyz Republic, Tajikistan, and Uzbekistan, and 1 providing limited services in Turkmenistan .

During the first year of implementation, the program took a tiered approach with some companies receiving a full menu of assistance from the various components, while others received limited service (such as only business training). In the Fall 2003, the EDP shifted its approach so that the EDCs are structured and the consultants’ interactions with their clients mirror that of western consulting firms. This new strategy is referred to as the Enterprise Improvement Practice and resources are utilized from the business training, accounting reform, business advisory services, and quality management services components from the contract. Enterprise Improvement services are intended to be provided to a broad range of client firms at a moderate depth of assistance.

The relationship with a client now begins with the Relationship Manager (RM) working with senior management of an enterprise to develop a Strategic Action Plan (SAP). The SAP identifies an organization’s vision, its opportunities and challenges, and concrete steps (with a timeframe) that are necessary to advance the company to its next stage of development, and it is broken down into the three main units of a business’s operations: marketing, finance, and operations. Resources from the EDP that can assist are identified during this process. Key Monitoring Ratios are collected by the RM at the beginning of the process and are monitored on a regular basis throughout the period of the partnership. These ratios assist in measuring the effectiveness of the technical assistance provided.

The main components of the Regional Trade Promotion (RTP) consist of local Trade Advisors (one in each EDC) and the internet-based market board (www.smetradecenter.net). Trade Advisors post “offers to buy” and “offers to sell” on the website and are in frequent contact with each other to match deals. Trade advisors also actively search for new markets for their clients, both within Central Asia and internationally. They have made trips to Afghanistan and Russia to explore new opportunities, which have resulted in some success. Through the association development component, the RTP is being rolled out to local business associations in order for it to expand and ensure sustainability in the long-term.

The largest single component of the EDP is the accounting reform component, and is referred to as the Certified International Professional Accountant (CIPA) program (please see www.cipaen.org for more information). The CIPA program is a Russian language testing and certification program that has three designations: the Certified Accounting Technician (CAT), the Certified Accounting Practitioner (CAP), and the Certified International Professional Accountant (CIPA). The CAP and CIPA certificates bear the International Accounting Standards Board (IASB) logo, which indicates that the program is based on and in compliance with IAS. Currently, exams are administered in five Central Asia countries as well as, Russia , Ukraine and Moldova .

The International Council of Certified Accountants and Auditors (ICCAA) is an association consisting of thirteen associations from Central Asia, Ukraine, Moldova and Russia, and is based in Almaty. Its mandate is to unite the accounting and auditing associations in the former Soviet Union and promote the CIPA program. The ICCAA co-issues the CAP and CIPA certificates with the appropriate local association, and an annual “Winter Congress” is held every year to discuss and decide on common issues and problems.

The Quality Management Center (QMC) is a local NGO based in Almaty and provides training and pre-audit ISO 9000 services for enterprises throughout Kazakhstan . It has a local Director and is advised by an ISO 9000 expert from the EDP. The QMC has a representative in each of the EDCs and it also provides its services in other regions of the country. The QMC is currently training its staff on additional standards such as ISO 14000 as a means to increase revenue. The QMC charges market rates for its services and its goal is to become self-sustaining by the end of the EDP’s base contract period. When the EDP first started its operations, there were no other providers of ISO 9000 training services. Currently, however, there are a number of private organizations (both local and international) that are servicing the Kazakh market.

Association development (AD), the newest component of the EDP, began its operations in the Fall 2003. The Mission ’s previous SME development project provided training to local business and accounting associations. The EDP’s AD component, in collaboration with the Trade Facilitation and Investment (TFI) project, focuses primarily on providing grants for the following activities: advocacy, member services, accounting reform, and cross border trade development. Ultimately, the AD component is intended to support projects aimed at the development of enterprises and entrepreneurs bringing them economic benefits.

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