To support African MSMEs – micro, small and medium-sized enterprises – affected by the consequences of the Covid-19 pandemic, AFD Group is scaling up the presidential Choose Africa initiative by mobilizing an additional €1 billion. This will bring the mechanism up to €3.5 billion instead of the €2.5 billion initially planned for 2018-2022.
Entire sectors of Africa’s economy are experiencing a marked slowdown due to the current health measures and reduced business activity. On the front line: microenterprises and small and medium-sized enterprises (MSMEs), which account for 90% of the entrepreneurial fabric and 60% of employment on the continent.
In addition to emergency measures (such as deferred repayments and technical assistance) which provided immediate initial support, AFD Group is now mobilizing €1 billion under the Choose Africa initiative. The objective is to help these MSMEs, which have been weakened by the huge fallout from the Covid-19 pandemic. This additional commitment brings the presidential initiative up to €3.5 billion instead of the €2.5 billion initially planned between 2018 and 2022.
This new “Resilience” component is implemented by Proparco, AFD Group’s private sector financing arm. It aims to support financing solutions for MSMEs, which are the backbones of the African economy. It is France’s contribution to the commitment to a $4 billion effort towards African MSMEs made by some twenty public development banks, including Proparco, at the first Finance in Common Summit organized from 9 to 12 November 2020 at the initiative of AFD.
This additional commitment is strengthening and scaling up the Choose Africa program, which is dedicated to financing and supporting African start-ups, microenterprises, and SMEs from now until 2022.
AFD Group has already committed over €2 billion under Choose Africa, supporting over 16,000 businesses and tens of thousands of entrepreneurs across the continent. They thereby benefit from improved access to credit or strengthening of their capital base. This financing will be combined with support activities to strengthen the capacities of some 2,000 companies.
Original source: AFD
