US, AfDB to launch support for entrepreneurs in Africa
The United States is teaming up with the African Development Bank in support of entreprenuers in Africa in a bid to draw more investment to the African private sector, the US government said on Tuesday.
By Agencies |
WASHINGTON: The United States is teaming up with the African Development Bank in support of entreprenuers in Africa in a bid to draw more investment to the African private sector, the US government said on Tuesday.
The US Agency for International Development (USAID) and the African Development Bank (AfDB) signed an agreement to launch a partnership in support of entrepreneurs in Africa.
The partners expect to mobilize up to 125 million dollars in private financing in less than six months for small and medium-sized enterprises (SMEs) to grow their businesses, the USAID said in a statement.
The accord marks the first time that the USAID and the AfDB have joined efforts to extend a joint guarantee, the US agency said, noting that entrepreneurship in Africa is flourishing and creating employment and economic growth.
"This partnership is a prime example of how development organizations can build upon and reinforce one another's strengths," said Henrietta Fore, USAID administrator. "The result is a much-needed expansion of financial services for African entrepreneurs."
Since the ability of entrepreneurs, small businesses and individuals in Africa is severely limited, the partnership will enable local and international banks to have greater access to "catalytic guarantees" that provide a bridge to encourage greater lending to SMEs, the agency said.
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The initiative aims to demonstrate the viability of African SMEs so that private financial institutions will gain the experience necessary to continue lending without additional USAID-AfDB support, it said. Businesses targeted for the support of the joint guarantee are those which would likely not have access to the financing essential for day-to-day business operations, upgrading equipment and technology and capital investments.
Women-owned businesses will represent a minimum of 25 percent of the SMEs that will be served in the program that is expected to last at least five years.
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