Finance institution the European Investment Bank (EIB) says it provided €5-billion for new private and public investment across Africa during 2020.
This represented the largest yearly EIB engagement in 55 years of operations on the continent and the largest support for climate action and investment in fragile states, it points out.
Financing and technical support provided by the EIB in Africa last year is indicated as backing more than €12-billion of new investment to improve agriculture, access to off-grid renewable energy and accelerating rural electrification, affordable housing, communications, climate resilience and climate insurance for smallholders, healthcare and private sector access to finance.
Overall, EIB backing for investment in Africa represented a 50% increase on engagement in the previous year.
This reflected the rapid response to strengthen public health investment, ensure access to safe and affordable Covid-19 vaccines through Covax, and accelerate access to finance to increase economic resilience and help entrepreneurs and private business to withstand unprecedented challenges caused by the pandemic.
“The EIB is fully engaged in supporting a green recovery for Africa through finance and expertise, also on the ground.
“In recent weeks, ahead of today’s European Union- (EU-) Africa Green Investment Forum, in Lisbon, the EU Bank and the Portuguese Presidency of the Council of the EU have brought together thousands of development partners across Africa in a series of Green Talk dialogues. This is a great demonstration of how investment in Africa can and must deliver sustainable development building on best-practice,” says EIB president Werner Hoyer.
The latest EIB engagement directly supported 58 projects in 28 African countries. In sub-Saharan Africa, 71% of the new EIB engagement confirmed in 2020 is supporting investment in fragile States and least developed economies.
The new high-impact projects backed by the EIB last year include securing access to clean drinking water for more than five-million people in Egypt, Burkina Faso, Kenya, Madagascar, Mozambique and Tunisia; connecting rural communities to clean energy across Chad, the Comores, Gambia, Mozambique, Rwanda and Uganda; and transforming waste management in secondary towns across Senegal.
In 2020, the EIB provided €2.4-billion for private sector investment across Africa. This included new initiatives with local financial partners and microfinance institutions to improve access to finance by small holders, entrepreneurs and business in Benin, Kenya, Mali, Congo, Ghana, Kenya, Côte d’Ivoire, Egypt, Malawi, Morocco and Senegal.
Since the start of the Covid-19 pandemic, the EIB says, it has rapidly approved new support to strengthen public health and ensure entrepreneurs, business and agriculture can access finance during challenging times.
This included support for enabling the public health response to the pandemic in Benin, Niger and Morocco and reducing the risk of Covid-19 at public water supplies in Kenya.
The EIB also agreed to back Senegal’s national economic resilience initiative and accelerate private sector financing targeting sectors most impacted by the pandemic in partnership with Afreximbank and local financial institutions across Africa.
As part of Team Europe, in December 2020, the EIB provided €400-million to help to rapidly roll out Covax supplies of affordable Covid-19 vaccines to Africa.
This accelerated up-front investment has enabled vaccine deliveries in recent weeks across the continent and represents the largest ever EIB support for public health outside Europe, it mentioned.
“The EIB stands ready to increase support for Covax alongside other donors enabling procurement of additional Covid-19 vaccines, and to overall strengthen vaccine manufacturing, diagnostics and public health in low and middle-income countries,” it notes.
Also, €3.4-billon – over two-thirds – of the new EIB financing in Africa in 2020 is supporting climate action. This includes scaling up renewable energy and improving access to off-grid energy, improving energy efficiency and protecting urban areas and strategic infrastructure from extreme weather and a changing climate.
At the end of 2020, the EIB reached its target of unlocking €1-billion of new investment to support gender equality and female entrepreneurs through the SheInvest initiative, launched in Johannesburg in November 2019 and guided by the global 2X gender financing standards.
SheInvest is helping to transform gender equality and demonstrates the impact of gender-focused lending to increase participation of women and girls in the economy and labour market, the EIB says.