DFC announces several Africa-focused transactions
The U.S. International Development Finance Corporation (DFC) board of directors this quarter approved several key transactions that use debt financing and equity investments to support U.S. national security and foreign policy priorities.
This quarter DFC also approved 22 other projects at the corporation level, focusing on development priorities such as food security, climate change, gender equity, and increasing access to financing around the world. Together, the DFC projects approved this quarter total more than $1.4 billion.
“The diverse set of transactions announced today will make real impact across a range of sectors and development challenges,” said DFC CEO Scott Nathan. “These transactions showcase how DFC strategically catalyses private capital where it matters most. I want to thank the board for their work and support for these deals.”
DFC’s board of directors this quarter approved the following Africa-related transactions:
– Growing agricultural resilience across Africa, Latin America, and Asia: An up to $35 million loan guaranty to Root Capital, a non-profit social lender strengthening agribusiness in Latin America, Africa, and Asia, will support loans to small and medium-sized enterprises (SMEs), enhancing projects tackling climate resilience, adaptation, and mitigation.
– Promoting global financial inclusion: An up to $146.1 million loan to finance a collateralised loan obligation securitisation of loans originated, underwritten, and serviced by responsAbility Investments AG, a leading asset manager in sustainable investments, which will enable downstream financing for MSMEs in DFC-eligible countries, providing much-needed capital for underserved communities around the world.
– Narrowing the finance gap in Nigeria: An up to $280 million loan to Access Bank Plc will address the financing gap for SMEs and advance financial inclusion as the bank commits to supporting women-owned and -led businesses.
– Supporting innovative entrepreneurship in Africa: An up to $15 million equity investment in Norrsken22 Africa Fund, a women-led fund investing in high-impact technology companies across Africa. The fund will support entrepreneurship and technological advancements in finance, medicine, and education.
– Driving growth capital for West African businesses: An up to $25 million equity investment in Uhuru Growth Fund I-A will drive catalytic capital for consumer-facing sectors such as financial services in lower-income and lower-middle income countries.
– Stimulating commercial lending to MSMEs in Egypt: A $100 million Egypt Loan Guaranty Facility 2, a loan guaranty facility for MSMEs, will build upon the success of the prior facility and support expanded lending to underserved communities in Egypt.
– Scaling the outcomes market to achieve the SDGs: An up to $15 million equity investment in SDG Outcomes Fund SCSp SICAV-RAIF, a fund transforming social and environmental challenges into investible opportunities, will support investments in 15-20 outcomes-based projects, such as impact bonds, focused on health, education, women’s economic empowerment, and the environment, to benefit the world’s most vulnerable populations.
The corporation this quarter also approved the following Africa-related transactions:
– Improving food security in Zambia: A $7.5 million loan to Zambia Lusaka Market Ltd. will support the development of an innovative market system that sources fresh produce from smallholder farmers, decreasing food waste, and improving households’ access to nutritious foods.
– Investing in quality education in Ghana: An $8 million loan to International Community Schools Limited in Ghana will support the expansion of its campus, increasing the enrollment capacity to an additional 500 students over the next five years.
– Promoting sustainable agriculture in Mozambique: A $10 million loan to Eco Farm Moçambique Limitada, an integrated organic sugarcane farm with modern processing, will facilitate the expansion of carbon-neutral sugar production in one of the poorest rural communities in Africa.
– Bolstering food security in Latin America and Africa: A $10 million loan to Fairtrade Access Fund S.A., SICAV-SIF will support the development of a sustainable agriculture sector by providing working capital, trade finance, and long-term loans to smallholder farmers.
– Mitigating risk to provide development-focused technical assistance: $8 million in political risk insurance will help enable DAI to implement technical assistance projects in 47 countries to be funded by certain non-governmental, bilateral, and multilateral institutions.
– Expanding renewable energy to power homes in Kenya: A $20 million loan to Brighter Life Kenya II will create a financing facility to purchase off-grid solar home systems and mobile phones in Kenya.
– Increasing responsible digital lending in emerging markets worldwide: A $10 million loan to Accial Capital supports additional capital for financial technology companies that are doing digital lending in emerging markets, while using a responsible finance impact lens.
– Furthering small enterprise development in Malawi: A $5 million loan portfolio guarantee to NBS Bank PLC, a commercial bank licensed in Malawi, will increase lending to MSMEs focused on agriculture, clean cooking, fisheries, and sustainable forestry sectors.
– Enabling lending for education and the informal sector in Tanzania: A $20 million loan portfolio guarantee to CRDB Bank Plc will support lending to SMEs, including those in the education and informal sectors.
Many of these investments are subject to Congressional Notification.
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