Access to finance by entrepreneurs and businesses with an impact on people in fragile situations across Africa will be bolstered by a new 12 year EUR 81.5 million initiative launched by the European Investment Bank (EIB) and the Eastern and Southern African Trade and Development Bank (TDB), which is expected to unlock EUR 163 million of investment. This is EIB’s first ever Facility to be specifically dedicated to the support of private sector in fragile contexts. The Facility will focus on overcoming barriers hindering access to finance by socially excluded people and communities.
This new fragile contexts investment initiative was formally launched in Nairobi on Thursday by Werner Hoyer, President of the European Investment Bank, and Admassu Tadesse, TDB President Emeritus and Group Managing Director ahead of the formal opening of the EIB’s new Nairobi Hub.
The initiative will catalyse investment that enhances financial and social inclusion and is expected to support entrepreneurs in remote regions, start-ups led by women and young people, among other groups with restrained access to financing. Private sector investment in sectors most impacted by the COVID-19 pandemic will also be supported by this new financing programme.
“Ensuring that entrepreneurs and communities across Africa can access finance is essential to tackle social exclusion and the impact of a changing climate. The EIB works closely with leading financial institutions across Africa to unlock high-impact targeted financing. We are pleased to strengthen our long-standing cooperation with our multilateral partner TDB to develop and today launch this pioneering financing to support people in fragile situations across Eastern and Southern Africa.” Said Werner Hoyer, President of the European Investment Bank.
Admassu Tadesse, TDB President Emeritus and Group Managing Director said: “We are thrilled to deepen further our partnership with the EIB, one of the Bank’s strategic partners in the region with which we work closely with advance the realization of SDGs, the Paris Agreement and Agenda 2063. TDB and EIB have been growing their cooperation since 2014 to finance critical projects tackling climate action and SMEs, in view of fostering sustainable growth in our region. This new facility targeted at businesses in fragile contexts will enable TDB to expand its reach even further to empower those who need it the most to sustainably participate in the economy.”
“Delivering targeted financing in fragile regions is essential to prevent social exclusion and unlock opportunities that drive economic growth. This new cooperation between the EIB and TDB to focus financing in fragile regions is a model for high-impact investment around the world.” said Thomas Östros, European Investment Bank Vice President responsible for Eastern and Southern Africa, and development.
Abraham Byanyima, TDB Group Treasury Executive said: “TDB’s funding base is increasingly composed of triple bottom-line-driven capital looking to to build up resilience against environmental, social and economic challenges in our frontier economies. Via this first-of-its-kind EIB financing initiative, TDB and EIB looks forward to boost its support to MSMEs, women, youth, those who are disproportionately affected by poverty in rural areas or urban slums, communities without access to electricity, among others. TDB and EIB’s relationship is multifaceted, with now three line of credit beyond deployed to advance sustainable development in TDB’s region, various technical assistance programmes and an East African Banking and Microfinance Forum organized by the partners yearly since 2018.
EIB President and Vice President spending four days in Kenya
EIB President Werner Hoyer and Vice President Thomas Östros are spending four days in Kenya meeting with political, business and financial leaders on their first official visit to Africa since the pandemic. The European Investment Bank is the world’s largest international public bank and last year provided more than EUR 5 billion for new investment across Africa.