The Africa Enterprise Challenge Fund (AECF) has committed to invest more than US$ 300 million (KES 30 billion) in the next three years to support businesses in the renewable energy and agribusiness sectors across Africa that directly work with rural people in Africa.
The investment, announced during the inaugural AECF conference under the theme “Taking the lead”, is part of the organization’s three-year strategic plan with an objective of impacting 25 million lives in rural Africa, in the next three years.
Appreciating the intervention of international development organizations and other stakeholders in pulling women into economic engagement, Public Service, Youth and Gender Affairs, Cabinet Secretary Prof Margaret Kobia stated that more needed to be done to remove barriers hindering women’s participation in development’. She said that in many African countries, women are still subject to legal or customary restrictions engaging in employment, entering into contracts, accessing credit, opening bank accounts, and owning property.
In Africa, small and growing businesses (SGBs) play a critical role in creating jobs and accelerating growth. They create around 80% of the region’s employment, establishing a new middle class and fueling demand for new goods and services. Access to finance, however, remains a constraint for SGBs in their quest to support governments achieve the Sustainable Development Goals (SDGs). AECF board Chair Lord Paul Boateng, stated that rural economy holds the key to sustainable economic growth thus the need to empower women who are its movers.
“AECF believes that these companies offer potential for growth, employment and income generation that directly impact the rural poor. However, most of these companies – the missing middle – fall outside the risk appetite of institutional and impact investors. We target this ‘missing middle’ by providing soft capital that enables businesses develop products and services that reach the underserved population,” said Lord Paul Boateng.
Noting that 70 percent of the women-led enterprises are in the agriculture sector, CS Kobia affirmed that the funds have catalysed the entrepreneurial spirit of Kenyan women who have established viable and innovative enterprises spread across the country. She pointed out some women led enterprises in the agriculture value chain include; Aloe Vera production in Taita Taveta; Sunflower and Soya bean production in Kakamega; Passion fruit production in Kericho; Fish cage farming in Homa Bay; Sesame processing in Siaya and Pig production in Kirinyaga.
AECF provides funding to private sector businesses in agribusiness and renewable energy sectors through periodically launched competitions. The funding provided is in form of a mix of non-repayable and repayable grants, tailored with flexible repayment options for the different businesses, depending on their stage of growth and risk profile.