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Capital injection encourages cross-border trade in high-quality plastics

Published on December 11, 2018

Organizations working in East Africa can now choose from less expensive and more diverse packaging solutions to support their operations thanks to a new investment into Blowplast, a leader in the African packaging sector. The company’s plastics products serve businesses in the petrochemicals, lubricants, edible oils, cosmetics, pain, pharmaceuticals, juice and dairy industries, just to name a few. With the investment Blowplast received in 2017, the company has expanded its manufacturing centers, diversified into new export markets and created 170 jobs to better serve regional markets.

Blowplast is another example of the 38 transactions the USAID East Africa Trade and Investment Hub has supported over the last four years (read about Bio Foods here). The Hub provided due diligence support to Blowplast’s investor by conducting two analyses: one of the plastics packaging industry and one of the company’s market positioning. The Hub also developed a growth strategy to map out Blowplast’s expansion plans. This enhanced the investor’s understanding of Blowplast’s place in the market, enabling both sides to close the deal.

Blowplast used the Hub’s recommendations to build a larger regional presence. The company invested in new technology, machinery and process improvements to optimize its operations, increase profitability and effectively compete. These innovations allowed Blowplast to produce lighter, cheaper and more durable packaging solutions at lower operating costs. Customers, in turn, can now choose from less expensive and more diverse packaging products.

“We have completely turned around the business using technology and Kaizen [a continuous improvement approach]; now, our factories run on auto-pilot. This frees up management time to be more strategic in searching for new growth and expansion opportunities,” said Sanjay Brahmbhatt, Blowplast’s managing director.

The company also refocused it business operations to expand regionally. Blowplast used the private capital to open new production facilities in Uganda and Madagascar, which gave them an entry point into target markets across eastern, central and southern Africa. Their expansion contributes to regional economic development through job creation, direct investment, taxes and duties paid. Further, it fosters knowledge sharing and technology transfer within the countries’ plastics industries, building up the sector’s skills and expertise.

In the past four years, the USAID Hub has helped close $143.2 million of investment transactions, enabling firms to create 1,522 new jobs, including employment for 1,131 women and youth. In addition to new employment, these transactions support greater access to finance, food security, stronger value chains and intra-regional trade, contributing to the region’s economic development.

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