Impact investor secures €15m from Spanish agency to support SMEs in Africa
Impact investor secures €15m from Spanish agency to support SMEs in Africa
Global Social Impact Investments announced a €15 million commitment from the Spanish Agency for International Development Cooperation.
Global Social Impact Investments (GSI), an impact investment fund manager, announced a €15 million investment from the Spanish Agency for International Development Cooperation (AECID). This investment aims to bolster GSI's strategy of investing in high-impact African companies. The funding is channelled through the Development Promotion Fund (FONPRODE), managed by AECID with advisory support from COFIDES, the Spanish development finance institution (DFI), known for financing sustainable and developmental projects worldwide.
GSI, through its GSIF Africa RAIF vehicle, targets investments in companies that deliver substantial social and environmental benefits across sub-Saharan Africa. These investments primarily aim to uplift the region's most vulnerable populations, including small-scale livestock and agricultural producers and their families.
In addition to the €15 million direct investment, AECID is providing €3.5 million in technical assistance. This assistance is designed to enhance the operational capabilities of the invested companies and to rigorously assess the additional benefits and impact of these investments.
Since its inception in December 2020, GSI's African investment portfolio has achieved an annualised net return of 4%.
Notable companies in the portfolio include Burn, a social enterprise transforming the cooking sector in East Africa by selling low-cost stoves that consume half the fuel and significantly reduce carbon emissions, thereby providing health and economic benefits to millions of families. Another key company is JKCC, a Ugandan enterprise that improves the livelihoods of thousands of small coffee growers by enhancing their land yields and enabling them to sell their coffee at competitive prices.
Eva Granados, president of AECID and secretary of state for cooperation, commented: “The Government of Spain is firmly committed to promoting impact investment through collaboration with public and private entities. Our goal is to achieve significant development milestones for all sub-Saharan African countries, ensuring regional stability, sustainable economic growth, and the dignity of all its inhabitants.”
María Ángeles León, co-founder and president of GSI, added: “We are very pleased with the support of AECID and COFIDES for our impact investment model. At GSI, we believe that investing in high-impact small and medium-sized enterprises is crucial for generating sustainable wealth and employment in sub-Saharan Africa, thereby contributing to a more just and prosperous future in the region.”
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