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Cablegate: Cae: Good for Angola and for American Businesses

VZCZCXRO9516
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHLU #0757 2040740
ZNR UUUUU ZZH
R 230740Z JUL 07
FM AMEMBASSY LUANDA
TO RUEHC/SECSTATE WASHDC 4183
INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY
RUEHTN/AMCONSUL CAPE TOWN 0334
RUEHJO/AMCONSUL JOHANNESBURG 0470
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS LUANDA 000757

SIPDIS

SENSITIVE
SIPDIS

JOHANNESBURG AND CAPETOWN FOR FCS

E.O. 12958: N/A
TAGS: BEXP ETRD ECON AO
SUBJECT: CAE: GOOD FOR ANGOLA AND FOR AMERICAN BUSINESSES

1. (U) Summary. The Angolan Center for Business Support
(CAE), founded to help bridge the gap between Angolan small
and medium sized enterprises and the oil industry, now
includes support for American businesses entering the Angolan
market. To Angolan SMEs it provides the full range of
business development, capacity building and matchmaking
services and instills in them norms of international
transparency and business ethics. For US businesses, CAE can
provide valuable information on business trends,
opportunities for networking, and (soon) due diligence
checks. End Summary.

Background: Center for Business Support (CAE)
---------------------------------------------
2. (U) According to Angolan law, the oil industry has a
twenty percent local content requirement. Sonangol, BP,
Chevron, Esso and Total hired the US-based Citizens
Development Corps (CDC) to evaluate the oil sector's needs
against the capacities of Angolan small and medium sized
enterprises (SMEs). The study found two major gaps: supply
and capacity. As a result, CDC formed the Center for
Business Support (CAE) (www.caeangola.com) to strengthen
capacity through the Supplier Initiative Program.

3. (U) CAE employs twelve people, including 3 Americans. Its
main goal is to build the capacity of Angolan businesses to
participate more actively and with greater success in the oil
and gas industry. As of June 31, 2007, 29 contracts valued
at more than $2.75M had been awarded to CAE clients; more
than 75 new employees were hired by these clients; more than
375 companies have utilized CAE services; fourteen clients
participated in foreign trade missions and more than 800
clients have participated in CAE training events. Company
products and services range from those directly related to
the petroleum industry to general service providers such as
caterers and cleaners. In the near future, CAE intends to
offer due diligence checks on Angolan companies on a fee
basis to US or other companies.

Capacity Building and Matchmaking
---------------------------------
4. (U) CAE's primary mission is to assist Angolan SMEs but it
can also help American businesses new to the Angolan market.
CAE offers the following to US businesses: introductions to
the oil companies, business trend reports, and links to a
number of CAE-certified potential Angolan partners. The
matches are beneficial to both sides - American companies
looking to evaluate and/or start businesses in Angola can see
proven models and American businesses can share know-how and
contacts with local certified SMEs.

5. (U) CAE also offers training on health, safety, security,
and environment (HSSE), bids and contracts, ethics, financial
management, supply chain management, human resources,
marketing and communications, business plans, and quality
management systems in five locations (Luanda, Benguela,
Soyo, Zaire, and Cabinda). Consultants work individually
with local client companies to improve their managerial
efficiency, the quality of service delivery, and perform due
diligence. Recognizing that access to financing is one of
the biggest challenges facing Angolan SMEs, CAE researched
and produced a booklet listing the financing services
available in Angola through local banks. In conjunction with
the launch of its financing book, it sponsored a financing
fair for representatives from the local banks and the
companies registered with CAE - one of the first in Angola.

A Bumpy Road to Success
------------------------
6. (SBU) CAE has helped fill the void in Angola of providing
practical - and often basic - business advice to SMEs. In
has conducted due diligence checks on its client companies,
collecting confidential business information in a country
which guards information closely. More importantly, it has
succeeded in impressing acceptable operational and ethical
standards upon a new generation of entrepreneurs. Although
the oil companies helped create and fund CAE to develop SME
capacity and create a base of independent companies to
satisfy their local content requirements, they are still not
able to source directly from many of CAE's beneficiaries as
these companies do not yet have the capacity or money to
purchase and store the quantities of goods necessary to meet
the demands of large multinationals. Though still
relatively small, CAE has evolved into a valuable resource
for both Angolan and new-to-market US SMEs.
FERNANDEZ

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