Rabo Development visits Jeroen Roodenburg at Ministry of Foreign Affairs

On Thursday May 23rd, Rabo Development and the participants of the Partnerbank Talent Program met with Jeroen Roodenburg, the Director Sustainable Economic Development and Ambassador Private Sector & International Cooperation at The Hague. It was a great opportunity to share the ideas of Rabo Development and to connect the objectives of Rabobank to the initiatives of the Ministry of Foreign Affairs.

Jeroen Roodenburg kicked off the meeting by expressing his appreciation to Rabobank for sharing its knowledge with his team. He explained what role the Ministry of Foreign Affairs plays in reducing global poverty. Jeroen’s team focuses on three different groups when it comes to Sustainable Economic Development: traditional aid countries (e.g. Afghanistan), transition countries and trade-investment relationships (e.g. China). The second group consists of countries which slowly but steadily phase out the “aid stage” and enter into an investment and trade relationship (e.g. Kenya, Ghana). One of the aims of the Ministry of Foreign Affairs is to create financial inclusion by facilitating access to financial services in developing countries.

Joris Timmers, Senior Project Manager for the Partnerbank Banco Regional in Paraguay and Longjiang Bank in China provided clear examples of how Rabo Development realises access to finance in developing countries. Through technical advice, benchmark tools, organisation building and value chain contracts with suppliers and farmers, Rabo Development assists local entrepeneurs to develop a sustainable businesses. “We want smaller farmers to establish cooperatives so that they gain bargaining power and improve their efficiency. Emerging farmers can be supported through value chain solutions to strengthen the ties in the value chain and increase financing opportunities.”

Marcel Beukenhof (Head Food Security and Finacial Sector) was struck by the many similarities between the objectives of Rabo Development and the Ministry of Foreign Affairs and asked the guests where they could do more to reduce the global proverty and realise inclusive growth. Rodrigo Rojas Vera, Head of Risk Analysis & Consumer Collections at Banco Regional in Paraguay answered this question by underlining the problem that long-term funding is needed to support the local farmers and ensure that their growth will be sustainable. Rodrigo: “We want to help the farmers for a long period, but that’s a challenge at the moment since long-term funding is difficult to attract for banks in developing countries.”

Joris Timmers added financial (i)literacy to the equation. “In the beginning people are not eager to switch from cash to digital money because it’s a big change for them and also because their earnings will become more transparent to the local tax administration”. Developing countries mostly have cash-based societies which makes it challenging for the (Partner) banks to attract savings that can be used as funding for new loans. The building of trust in banks remains an important challenge that the Partner banks are aiming to overcome.

Participants of the Partnerbank Talent Program Rodrigo Rojas Vera (Banco Regional in Paraguay) and Luís Henrique Veit ( Banco Cooperativo Sicredi in Brazil) both presented the key figures and developments at their partnerbanks. Their presentations gave the Ministry of Foreign Affairs an idea of how financial inclusion is realised in Paraguay and Brasil and which obstacles still have to be overcome.

Colleagues of Jeroen Roodenburg concluded the meeting by providing a sneak preview to the new initiatives of the Ministry of Foreign Affairs. Tess van der Zee (Senior Policy Advisor) explained about the ‘Dutch Good Growth Fund’ which addresses the financial access barriers for Dutch and local SME’s. Renske van der Kooi (Senior Financial Sector Development Specialist) added that this fund is established to stimulate innovative ways to increase access to finance (e.g. IT, mobile banking, development of rating tools). Wim Bekker (Senior Policy Officer Sustainable Economic Development Department) told more about the Currency Exchange Fund (TCX) which is a special purpose fund that provides over-the-counter derivatives to hedge the currency and interest rate mismatch that is created in cross-border investments between international investors and local borrowers in frontier and less liquid emerging markets. The goal is to promote long-term local currency financing, by contributing to a reduction in the market risks associated with currency mismatches.

Jeroen Roodenburg thanked Rabo Development and the partner banks for visiting the Ministry of Foreign Affairs and underlined the importance of the bilateral relationship with Rabobank: “Rabobank will remain an important partner of us in working on more inclusive growth worldwide.”

For more information about the Partner bank Talent Program, please contact Karin Hendriksen-Nijenhof.