Promoting Youth Job Creation and Building Country’s Resiliency through Youth Entrepreneurship Program
May 8, 2023
It was 2 PM, and the sun was shining brightly, adding up to the already 32 degrees Celsius temperature that afternoon, an average temperature in Dili. That coffee shop is next to the main road, its door has been wide open since 10 AM and bright colorful walls with artistic murals welcome the visitors, creating an energetic youth vibe. Artificial grass adds fresher touch to the wooden chairs and tables in that semi-outdoor premise, making it very convenient to relax amidst the hot temperature. A pile of board games and books is neatly organized in the corner of the room for a group of people who want to stay a little bit longer. Behind the bar, there is Yuni, a 27-year-old entrepreneur busy preparing a cup of iced caramel coffee, a new menu in her coffee shop.
“I started this coffee shop in June 2021, in the middle of a pandemic”, Yuni said while serving the iced coffee. The coffee was fresh, she directly sourced it from local producers. The ice and sweetness from the caramel successfully neutralized the hot temperature that afternoon.
Yuni was one of the Timorese entrepreneurs who struggled to navigate their businesses amidst the hardship caused by the pandemic. As a single mother, she is the breadwinner of her family. According to UN Joint Socio-Economic Impact Assessment (SEIA 2020), the COVID-19 pandemic has created a destructive impact on micro, small, and medium enterprises (MSMEs). 81 % of MSMEs reported a loss of income during the lockdown. Due to drops in income, some businesses, 26%, also reported difficulty in paying staff wages and tried to cope by reducing staff hours or suspending their contracts temporarily.
As a response to this situation, UNDP with the support from Ministry of Tourism, Commerce and Industry (MTCI) organized a Business Innovation Challenge (BIC) as a way to provide financial access to youth entrepreneurs. She was among over 200 youths who participated in a series of business training and pitching sessions before finally being awarded grants to support her business. With the grants, she managed to scale up her businesses by purchasing more equipment and employing other youths.
“My revenue increases by 70 % after receiving support from UNDP. I am now employing nine youths from previously only three.” Job creation for youth is highly critical for Timor-Leste, a country with over 70 % of the population are people aged between 16-34 years old. According to research from Monash University in 2021, around 30,000 youths finish their education every year and are ready to enter the job market yet the labor demand is very low.
UNDP has committed to promoting youth-led MSMEs through a series of business training, access to finance, and networking events to promote youth-to-youth job creation and entrepreneurship skills for Timorese youth. This initiative is translated to a six-year Youth Employment and Entrepreneurship Skills (YEES) joint program mainly funded by Korea International Cooperation Agency (KOICA) with co-fund from MTCI and involving various stakeholders as implementing partners, such as the Secretariat of State for Vocational Training and Employment (SEFOPE), Secretariat of State for Youth and Sports (SSYS), The Entrepreneurship Development Support Institute (IADE), Entrepreneurship Registration and Verification Agency (SERVE), and National Commercial Bank of Timor-Leste (BNCTL).
The aim of the program is not only to create jobs for youth but also to foster innovative thinking and improve the existing value chains. As a country that is prone to increasing climatic variability and unpredictability, particularly in relation to rainfall and extreme weather events, and over 60 % of its population is engaged in subsistence agriculture, it is extremely important for Timor-Leste to develop more resilient agribusiness products.
Martinho Gorety, another youth entrepreneur, realized this fact and began to develop a business in food processing and preservation. He collaborated with an Australian-based social enterprise to adopt their brand, Corner Store Network, yet still struggled with financial access and networking. Through UNDP’s business competition and networking event, he managed to secure grants to increase his production capacity and build his business network.
“Through the grants, I managed to buy a packaging machine and my production capacity increases from 50 packs per hour to 150 packs. My products are also now available in over 16 retailers in the country, thanks to UNDP’s network”, said Martinho gratefully.
His enterprise produces different types of agriculture processing products, such as jam, chips, tea, coffee, and coconut oil. “The idea was coming from my worriedness because the agricultural products are seasonal. Sometimes I wanted to buy mango, but it is not available in the market, so how we can preserve mango through food processing so it will be available regardless of the season?” His type of business is highly relevant for Timor-Leste to have regenerative products, improve food security, and have value-added products that can penetrate the global market.
Both Yuni and Martinho are the future of businesses in Timor-Leste, which are mainly dominated by MSMEs. To this date, UNDP Timor-Leste through its Youth Hub (Knua Juventude Fila Liman/KJFL) and its entrepreneurship support flagship has been providing business training, information, counseling, and financial access to over 1,000 youths. This initiative will be continued under the YEES Project until 2027.