Funding for agriculture and SMEs

From left; Mark Napier, ALCB Fund board member; AfDB Trade Finance manager, Yaw Kuffour; and KfW principal project manager, Karl von Klitzing. Source: AfDB

Farmers and small business owners in Africa will find it easier to raise finance through the capital markets following the signing of a US$50-million loan agreement by the African Development Bank, US Overseas Private Investment Corporation (OPIC) and German development bank KfW.

“Capital markets in Africa are both a challenge and an opportunity,” said OPIC vice president for Small and Medium Enterprise Finance, Jim Polan.

“This fund will have a tremendous impact by increasing the amount of long-term local currency financing available to companies operating in impact sectors.”

“Impact sectors” are seen as agriculture and small and medium enterprises.

According to Polan the loan agreement will help to address a number of challenges in African capital markets such as limited primary issuances, price transparency and limited participation by local market investors.

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