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2002 ChevronTexaco Corporate Responsibility Report Economic IssuesSupplier Diversity & Small Business Development (Continued)> Venezuela: In the company’s Hamaca joint venture in Venezuela,ChevronTexaco spent 62 percent of its procurement funds with localsuppliers by the end of 2002, exceeding the government’s local contentgoal of 60 percent.> Kazakhstan: ChevronTexaco’s joint venture Tengizchevroil (TCO)met its 37 percent local content goal in 2002.> South Africa: Caltex Oil (S.A.) established a task force to support theSouth African government’s Black Economic Empowerment (BEE)program. As part of the company’s BEE efforts, Caltex gives preferentialtreatment to Historically Disadvantaged South Africans; providessupport and training to small, medium and micro enterprises; andsupports companies that actively promote development and skillstransfer for their employees. The company increased the total amountit spent on suppliers through the BEE program from 5 percent in2001 to 23 percent at the end of 2002. For 2003, Caltex Oil (S.A.) hasa goal to increase BEE purchasing spend to more than 25 percent oftotal spend on goods and services.Case Study >Developing Small Businessin KazakhstanAt ChevronTexaco’s joint venture in Kazakhstan, Tengizchevroil (TCO), theSmall Business Development (SBD) group is working to help develop andsupport small, locally owned companies in the country.Although the SBD loans play a relatively small part in helping TCO achieveits aggressive targets for buying from Kazakh providers, they are an importantpart of TCO’s community economic development commitment. In 2002,TCO met its 37 percent local-content goal, spending more than US$415 millionon Kazakh goods and services. TCO is on target to meet its 2004 goalof 39 percent local content.Here are some success stories behind the SBD loans:> Kazcomservice: The SBD group’s initial loan of US$350,000 in 1999,followed by US$400,000 the following year, turned this four-persontelecommunications cabling company into one of TCO’s leading generalpurposecontractors. Kazcomservice now employs more than 900 peoplein four locations around the country.> AutoStroyService: To compete for TCO road repair work, AutoStroyServiceneeded funding to upgrade its machinery. SBD’s loan of US$150,000 providedthe necessary equipment upgrades. The resulting increase in Auto-StroyService’s business allowed the company to repay the 36-month loanin less than 12 months.> Olzha Co.: Olzha, a TCO primary contractor providing rail cars, maintenanceand other transportation services, wanted to help develop a marketfor naturalgas-powered vehicles in Atyrau, Kazakhstan. The companyreceived an initial US$300,000 loan from the SBD group. Olzha’s plan,which includes a liquefied petroleum gas filling station and offloadingrack, could provide healthy competition for the local monopoly. If Olzhameets specific mutually agreed-upon goals, it could receive anotherUS$300,000 loan from the SBD group to further develop the business.The SBD group was formed in 1997 and initially focused on funding communityorganizations or enterprises with social missions. In 2001, thegroup refocused its efforts to specifically target small businesses thatcould provide goods and services to TCO, although it still provides somecommunity-benefit loans. Loans provided by the SBD group range in sizefrom US$5,000 to US$750,000. Since it was formed, the SBD group hasmade 143 interest-free loans totaling nearly US$5.5 million and hashelped create more than 1,000 jobs.Beyond simply providing the loans, the SBD group’s four-person staff takesa hands-on role in working with loan recipients by providing technical orbusiness assistance as appropriate, ensuring timely payments, and helpingidentify and address any problems the companies encounter. The SBDgroup’s goal is to see that the businesses it helps develop are successfuland become self-sustaining.© 2003 ChevronTexaco Corporation. All Rights Reserved.34