New DGGF Investments in 2017 Support Future Job Creation Across the Globe
In March 2017 the Dutch Ministry of Foreign Affairs extended the DGGF budget for financing local SMEs from EUR 270 million to EUR 327,5 million. This represents an extra incentive to continue building a high quality portfolio of funds and financial institutions that offer unique solutions adapted to the financing needs of SMEs. This update reflects the investments closed with DGGF fund of funds in the first half of 2017, next to an update on new Seed Capital and Business Development initiatives.
In South and East Africa DGGF recently committed to Inside Equity Fund, one of the very few private equity funds providing financing to underserved SMEs in several countries including Zambia and Madagascar. Thanks to a DGGF loan to Tanzania’s first licensed leasing company Equity for Tanzania the institution can now serve a broader base of rural SMEs not qualifying for bank financing.
In West Africa, rural employment is also central to the strategy of DGGF’s new partner, the Fund for Agricultural Finance in Nigeria, an innovative agribusiness fund targeting particularly rural SMEs often with a young workforce. In Liberia, DGGF has provided a loan to Access Bank to develop a new SME product, thereby supporting job creation in a fragile state, where the SME market is among the most financially underserved globally.
In francophone West Africa SCBD completed the last local stakeholder consultations assessing the conduciveness of entrepreneurial ecosystems for local enterprises with a well-attended workshop hosted in Abidjan on July 19th. The findings will be part of the regional study to be published in October 2017. Closing the gap Guinea the first out of six country studies available.
In the Eurasia region, DGGF became an anchor investor in Gazelle Fund contributing to the establishment of one of the very few providers of mezzanine financing in its target countries – Georgia, Armenia, Moldova, and Kyrgyzstan – and helping promising entrepreneurs in the region to reach full potential. In Mongolia, DGGF has supported Xacbank to resume the growth of its SME loan portfolio and contribute to the recovery of the Mongolian economy after several crises. In addition, Closing the Gap Mekong will engage with entrepreneurial ecosystem players, starting in Cambodia with the first local stakeholder workshop to be hosted in December 2017.
In Central and South America, DGGF has provided a local currency loan Genesis, an NGO financial institution serving the lower SME segment in Guatemala, to further develop the SME product. SCBD is supporting Sempil, a pioneer digital SME lender in Colombia which differentiates itself by not asking for extensive credit history or matching collateral. Sempil is able to deploy long-term debt through digital loans in local currency thus serving the lower bracket of the Missing Middle. In the Middle-East, DGGF has provided a loan to Sanadcom, a fully dedicated SME lender in Jordan. With this investment DGGF supports job creation in a country which is heavily affected by the Syrian crisis and an unprecedented influx of refugees. Through an investment in the non-for-profit SME lender FATEN, DGGF also contributes to further economic development of the Palestinian Territories, which are characterized by a fragile macroeconomic and political environment.