OPEC Fund approves US$20m for SMEs in East Africa

The OPEC Fund for International Development (the OPEC Fund) has signed a US$20 million term loan in favor of East African Development Bank (EADB). EADB will use the loan to support small- and medium-size enterprises (SMEs) and infrastructure projects in East Africa.

EADB is an important regional development institution for delivering key development objectives across the East Africa region. It enjoys a high level of commitment from member states Kenya, Uganda, Tanzania and Rwanda, as well a diverse shareholder base that includes multilateral and bilateral development institutions and international financial institutions.

SMEs account for more than half of EADB’s portfolio. They play an important part in development, driving economic growth and employment opportunities in East Africa and in developing countries more generally. The bank is expanding its resource mobilization activities to meet the growing financing needs of SMEs.

“We are very pleased to support private sector development in East Africa, which goes to the core of our mandate,” said OPEC Fund Director-General Dr Abdulhamid Alkhalifa. “We have partnered with EADB since 2001 and we appreciate the opportunity to strengthen our relationship. SMEs are critical to achieving progress toward Sustainable Development Goal (SDG) 8 on decent work and economic growth. Efficient infrastructure, as part of SDG 9, improves access to social services, reduces business and production costs, supports trade, and will ultimately provide East Africa with a more competitive business environment.”

Vivienne Yeda, the Director General of EADB, said: “We are pleased to receive a line of credit of US$20 million from the OPEC Fund dedicated to financing SMEs and infrastructure projects in EADB member countries. We appreciate the confidence placed in the EADB by the OPEC Fund. By financing SMEs, we expect to promote enterprises that generate employment opportunities, social economic development and consequently promote regional integration. The SME sector is a critical pillar for sustainable economic growth as it is the backbone of the EADB member countries’ economies.”

This is the third loan the OPEC Fund has provided to EADB in support of SMEs. In 2001, the organization approved US$10 million, followed by a further US$15 million in 2013.