1. Economic Cluster Building An effective response to the globalization of markets And An Opportunity for Africa TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

2. Case Study from Madagascar Two cluster developments in the textile sector Industrial Cluster: Textile/Clothing in Antananarivo Artisan Cluster : Hand Embroidery in Analamanga region TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

3. Industrial Textile Cluster Text’île Mada in Antananarivo  Created in 2004  24 member companies with a workforce ranging from 100 -1.600  Total employment of 9.000 people  Joint annual turnover of € 70 Million  Two support programme timeframes:  2005-2008 with total budget of € 1.6 Million  2009-2011 with total budget of € 2.1 Million TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

4. Impact of Cluster concept Text’île Mada Quantitative results (2004-2007):  27 % total turnover increase  12 % total employment increase  Substantial increase in production capacity as well as utilization Qualitative results:  Introduction of CSR principles to all members and certification  Diversification of production capabilities and product offering  Joint sourcing strategies locally and internationally  Joint initiative to improve energy supply and hight cost problem  Development of joint Textile Services Centre  Strong implication in sustainable development projects, e.g. licensed manufacturers of «Fairtrade cotton »  Increased visibility and improved image towards main buyers TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

5. Artisan Cluster «Artisan Network» Salohin’Iarivo in Analamanga  Created in 2006/2007  96 production units  80% of artisans in informal economy  Total employment of 900 people  Total turnover of € 200.000 per year  3-year support programme in progress with budget of € 450.000 Current Situation:  On average, company turnover multiplied by 4 and employment by 3 within 2 years with some units by almost 40 for turnover and 20 for employment  67 female production units were formalized via joint cooperative  7 mutual guarantee funds were created, which are currently being formalized TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

6. Impact of Cluster concept Network Salohin’Iarivo Quantitative results:  Visible increase of overall turnover  Increase of total employment  Strengthening and expansion of production capacities  Formalization of artisans via cooperative approach leading to new business opportunities Qualitative results:  Improved credibility versus socio-economic partners  Improved competitiveness of artisans  Inclusion of concept in the President Ravalomanana strategic development plan (MAP)  Sharing of operational tools with other artisan networks  Development of locally adapted financial instruments for working capital and investment projects  Joint sourcing of material inputs and services TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

7. Cluster and Complementary Tools Cooperative (C.A.E.S) * Services : - Management - Accounting New companies Informal Craftsmen or forma SMEs Economic Cluster and Company Networks Shared tools Joint sourcing groups Mutual guarantee TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

8. Case Study from Burkina Faso Artisan Company Network Uprotex  Located in Ouagadougou  In the Textile-Clothing sector  3-Year Support Programme with total budget of € 250.000  24 production units  80% in informal sector  Total employment of 650 artisans (weaving, dyeing, clothing)  Total annual turnover of € 500.000  Cooperative created to formalize majority of member companies TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

9. Case Study from Mali Artisan Company Network Gprofitex  Located in Bamako  In the Textile-Clothing sector  3-Year Support Programme with total budget of € 250.000  43 Production units  80% in informal sector  Total employment of 600 artisans  Total annual turnover of € 600.000  Cooperative created to formalize majority of member companies TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

10. Impact of Formalization Process via Creation of Cooperative For every informal artisan or new activity set-up A legal trading status and a Trading License A continuous training programme: accountancy, management A better understanding of costs and selling price calculation Improved credibility A social insurance for the artisan and his/her family Accumulated savings for future own company creation TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

11. Summary The complementarity of the different tools improve the competences and the competitiveness of the companies and regions as well as their positioning within a globalized market Imrproved professionalism -> technical and service training Formalization, market development -> cooperative approach Increased financial capacity -> mutual guarantee, guarantee funds Export marked development -> joint presence at fairs Improved communication -> joint strategy with joint leaflets, website, etc. Improved cost management :  Sharing of financial tools  Joint sourcing  Shared service center TCI Cape Town - November 2008 Annie FAVRIE Afa consulting

12. SALOHIN’IARIVO Les Brodeuses de Talent Annie FAVRIE - afa consulting - annie@favrie.com