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Finance in the Value Chain

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FINANCE IN VALUE CHAIN ANALYSIS—A SYNTHESIS PAPER microREPORT #132

OCTOBER 2008 This publication was produced for review by the United States Agency for International Development. It was prepared by DAI.

FINANCE IN VALUE CHAIN ANALYSIS—A SYNTHESIS PAPER microREPORT #132

The authors’ views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government.

CONTENTS
INTRODUCTION ................................................................................. 1 OBJECTIVE ................................................................................ 1 DEFINITION ................................................................................ 1 IMPORTANCE ............................................................................. 1 REPORT STRUCTURE ................................................................. 1 THE VALUE CHAIN ANALYSIS (VCA) FRAMEWORK ..................... 3 ANALYTICAL VCF FRAMEWORK WITH CASE-STUDY ILLUSTRATIONS ................................................................................ 7 UNDERSTANDING THE CURRENT CASH FLOW AND CREDIT STRUCTURE (ANALYTICAL PHASE) ............................................ 7 Intra-firm Finance ......................................................... 8 Finance Services Provision .......................................... 9 Inter-firm Finance (Governance) ................................ 10 UNDERSTANDING THE FINANCE OF THE CONTEMPLATED UPGRADING OPPORTUNITY (STRATEGY PHASE) ....................... 11 (Bank) Ability .............................................................. 12 Acumen ...................................................................... 13 Availability .................................................................. 13...

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