Washington, DC, May 10, 2010—IFC,
a member of the World Bank Group, today launched a new fund that will focus
exclusively on investing in small and medium enterprises in central Africa,
helping to improve access to finance, create employment, and reduce poverty
in some of Africa’s least developed countries.
IFC is investing $12.5 million in equity
in the Central Africa Small and Medium Enterprise (SME) Fund, which will
make equity and equity-related investments in smaller businesses across
the central African region. It will initially focus on companies in the
Central African Republic.
The fund will be managed by XSML, a
social investment fund manager based in the Netherlands, and Cenainvest,
an SME fund manager based in Cameroon. With IFC’s support, XSML and Cenainvest
will aim to mobilize a total of $25 million for the fund from other development
finance institutions and the private sector.
Jan Vos, Managing Partner at XSML, said,
“By providing financing for small and medium enterprises, the Central
Africa SME Fund will address a key constraint to the further development
of Africa’s private sector. The fund will aim to be an important source
of socially responsible financing for companies across central Africa and
contribute to reducing poverty across the region. We are very proud and
pleased to help African entrepreneurs build sustainable businesses that
create jobs and income.”
Companies that the fund invests in will
also receive advice on implementing better corporate governance, raising
environmental and social performance, and other business support. The business
support services facility will aim to improve the long-term and sustainable
development of investee companies by advising them both before and after
they receive financing.
The Central Africa SME Fund is the first
of several private equity funds under the SME Ventures program that IFC
aims to launch in the coming months to invest in smaller businesses in
Africa’s least developed regions and in countries emerging from conflict.
All of the funds will leverage the expertise of locally based fund managers
and combine financing with business support services and advisory to smaller
IFC Executive Vice President and CEO
Lars Thunell, said, “Supporting the growth of small and medium enterprises
in Africa’s poorest economies and in countries emerging from conflict
is a strategic priority for IFC in the region. The Central Africa SME Fund
is an important part of IFC’s efforts to improve access to finance for
entrepreneurs and create opportunities for people in places that need it
The fund’s individual investments will
be between $100,000 and $500,000, targeting companies in several sectors,
including agribusiness, information technology, telecommunications, transportation,
warehousing, and tourism.
IFC, a member of the World Bank Group,
creates opportunity for people to escape poverty and improve their lives.
We foster sustainable economic growth in developing countries by supporting
private sector development, mobilizing private capital, and providing advisory
and risk mitigation services to businesses and governments. Our new investments
totaled $14.4 billion in fiscal 2009, helping channel capital into developing
countries during the financial crisis. For more information, visit www.ifc.org.