[{"bbox": [85, 152, 1145, 266], "category": "Text", "text": "the necessary investments (internet, computers, tablets, smartphones) in rural areas. Moreover, it is crucial to develop mechanisms to raise awareness among producers, the private sector, processing companies and organisations of the focal sectors (coffee, cacao, sugar cane, palm oil) on the new EU regulations on corporate sustainability due diligence and the regulation on deforestation-free products, as well as its implications for these groups."}, {"bbox": [85, 278, 1145, 422], "category": "Text", "text": "Lessons learnt from the Phase I of the TIF programme implemented by the Spanish Financial Cooperation (COFIDES), through the FONPRODE²⁹ indicate that in 2021 the situation of Financial Service Providers (FSPs) has turned out to be even worse than in 2020. Once the relief measures (local and international) were lifted, the true effects of the economic crisis after the outbreak have emerged, impacting the portfolio quality of intermediaries. This brings to a further need of support in capacity building of FSPs to improve risk management."}, {"bbox": [85, 434, 1145, 576], "category": "Text", "text": "An increasing demand to foster digital transformation has also been identified. For most FSPs, the initial digital response coming from clients during the pandemic has been globally positive. Digital literacy of poorer segments should not be underestimated. There is an important potential for development in this area. Digital Finance emerges as a catalyst for narrowing the gender gap. Building resilience to Climate Change on vulnerable segments is seen as a general concern and cross-cutting issue."}, {"bbox": [85, 589, 1145, 704], "category": "Text", "text": "Therefore, it is important to take advantage of the existing potential and to implement ecosystem and customer-focused approaches to answer specific needs for particular segments and develop not only new financial products but, more crucially, new delivery channels, as a better response to the most vulnerable population needs. Thus, the importance of innovation becomes clear."}, {"bbox": [99, 717, 429, 749], "category": "Section-header", "text": "## 3.4 The Intervention Logic"}, {"bbox": [85, 763, 1145, 877], "category": "Text", "text": "The underlying intervention logic for the proposed action is that it should be possible to reduce inequalities through inclusive and sustainable economic growth based on access to finance, innovation and digitalisation and new economic models that are respectful of the environment that lead to the creation of decent jobs for the most vulnerable groups and bottom 40% income of the population, leading to the formalisation of the economy."}, {"bbox": [85, 890, 1145, 1261], "category": "Text", "text": "By applying the TEI approach for the implementation of part of Outcome 4 (Outputs 4.1 and 4.2), we are seeking to maximise resources from the EU and EU Member States, namely Germany, Spain and Sweden. The approach will aim at increasing the competitiveness of MSMEs and cooperatives in key value chains of the agricultural sector through enhanced digitalisation/digital traceability, innovation and circularity at the same time improving access to finance for MSMES and cooperatives and most vulnerable segments of the population. The main market failures identified are: the gap between the financial needs and the supply of financial services in Guatemala, which is significant for MSMEs, especially women-headed MSMEs, indigenous entrepreneurs, and smallholder farmers, also the hardest hit by climate change and informality; and the digital gap between rural/urban population, women, indigenous communities, etc. The logic was developed around a common strategy and priorities identified with EU Member States, namely financial inclusion and access to finance and the use of innovation and digitalisation to make key value chains selected more competitive, leading to the creation of decent jobs and reduction of the inequalities. The agricultural value chains selected concentrate on workers coming from the most vulnerable groups and bottom 40% income of the population."}, {"bbox": [85, 1275, 856, 1303], "category": "Text", "text": "By applying the Triple Bottom Line (TBL) approach to access to finance we aim to:"}, {"bbox": [119, 1328, 1145, 1379], "category": "Text", "text": "1. Deepen financial access for the bottom of the pyramid, mostly through digital transformation with a gender focus;"}, {"bbox": [119, 1381, 862, 1408], "category": "Text", "text": "2. Manage environmental risks and foster green products through Green Finance;"}, {"bbox": [119, 1413, 1009, 1442], "category": "Text", "text": "3. Strengthen the business and MSMEs' ecosystem through capacity building and debt financing."}, {"bbox": [85, 1453, 370, 1480], "category": "Text", "text": "This TBL approach will entail:"}, {"bbox": [103, 1480, 1140, 1507], "category": "Text", "text": "* an increased emphasis on gender by leveraging digital finance for gender equality and women's empowerment;"}, {"bbox": [85, 1538, 1145, 1638], "category": "Footnote", "text": "²⁹ FONPRODE, managed by AECID, is the main financial instrument of the Spanish Cooperation to support the private sector in developing countries through Official Development Assistance operations. Together with its predecessor, FCM (Microcredit Fund), the Spanish financial cooperation has gained 20 years of experience in supporting inclusive finance, among other sectors, with an aggregate of 131 loan operations for more than 629 million EUR invested in 96 FSPs (from which, 71% 1stTier FSPs and 29% 2ndTier; and 81 FSPs in LAC) of 29 developing economies (14 in LAC). FONPRODE has proven its performance. Aggregated estimates amount to more than 2 million micro and small entrepreneurs being directly or indirectly supported."}, {"bbox": [1027, 1682, 1145, 1706], "category": "Page-footer", "text": "Page 25 of 39"}]