AfDB Okays €9.8m For Venture Capital Investments In Africa
The African Development Bank Group (AfDB) has approved €9.8 million support for venture capital investments in Africa.
The AfDB stated this in a statement on Tuesday, noting that the funding would serve as support for the start-ups from seed to growth stages.
According to the bank, the €7 million of the equity investment will be sourced from its resources while the additional €2.8 million represents funds provided by the European Union (EU) through a partnership with the Organisation of African Caribbean and Pacific States (OACPS).
The AfDB added that the investment will help Cathay-AfricInvest Innovation Fund meet its target of securing €110m to invest in over 20 early-stage ventures across sub-Saharan Africa.
The Innovation Fund focuses on financial inclusion (financial tech and insurance tech), retail and logistics platforms targeting online and mobile consumers, healthcare technologies, and pay as you go, off-grid energy technologies.
“More recently, the Innovation Fund has expanded its focus to include start-ups that are harnessing new digital opportunities created as a result of the Covid-19 pandemic, or with high potential to help fight the coronavirus,” it stated.
“The Mauritius-based Fund is jointly sponsored by AfricInvest Capital Partners and Cathay Innovation SAS.”
Commenting on the equity investment, Stefan Nalletamby, the AfDB’s director for financial sector development, said: “The Bank’s approval is another milestone in the implementation of the Boost Africa Program and its partnership with the EU, OACPS and the European Investment Bank.
“It signals the importance given to tech-enabled high growth entrepreneurs on the continent and the key role of AfricInvest and Cathay Innovation in supporting this key business segment in Africa to achieve Africa’s growth, transformation and integration objectives.”
It further stressed that the investment is expected to accelerate the creation of a new class of successful African entrepreneurs that will serve as a model to younger innovators.
The bank said it would also support youth and women-led start-ups and increase access and inclusion to financial and ‘real sector’ services and goods through appropriate technology and innovation.
Last month, the AfDB said it would raise $1 billion to enhance wheat production across Africa.
The financial institution noted that it was in a bid to forestall the hike in food prices in Africa following the Russia- Ukraine conflict – a crisis in its ninth week.
Speaking on the development, Akinwumi Adesina, AfDB’s president, said the fund would assist 40 million African farmers to utilise climate-resilient technologies and increase their output of heat-tolerant wheat varieties and other crops.
He said the plan would increase the production of wheat, rice, soybeans, and other crops to feed about 200 million Africans.
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