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AGF Signing Ceremony with SIMA


Nairobi – January 17, 2018 The African Guarantee Fund (AGF) believes the SME sector is the real engine of growth in Africa. With the continuous global discourse around climate change, it is vital that this economic growth be sustainable and environmentally friendly. In 2016, AGF established a Green Guarantee Facility (GGF) with the support of the Nordic Development Fund to enhance access to finance for climate and green growth-oriented SMEs. In addition, this facility includes a capacity development component to build knowledge and capacity of banks in Africa to scale up lending to the green economy.

In light of this, AGF is pleased to announce that it has signed a USD5 million loan guarantee agreement with Social Investment Managers & Advisors (SIMA). This guarantee, which falls under AGF’s Green Guarantee Facility, will facilitate the completion of SIMA’s USD75 million fund to provide vital debt financing to SMEs engaged in providing access to energy to low income populations predominantly in sub-Saharan Africa. Through this guarantee, SIMA intends to leverage 15 times the investments from institutional investors to improve the environment through CO2 reduction and improve the health and quality of life of millions of Africans in low-income settings.

“Solar companies are engaged in asset-backed microfinance and we feel that the microfinance sector can also play an important role in expanding the industry and achieve greater outreach through their well-established ability to lending in the Bottom of the Pyramid (BoP) markets. Demand for off-grid solar is growing at 55% per annum. With this Fund, our aim is to support Access to Energy to over 1 million people,” stated Xavier Pierluca, Managing Partner at SIMA.

Felix BIKPO, AGF’s Chief Executive Officer stated, “The insufficient supply of energy affects all aspects of development including social, economic and environmental, across the continent. Over 645 million Africans lack access to electricity while 700 million lack clean energy cooking options. Improvements in standards of living are manifested in increased agricultural and industrial outputs; the provision of efficient transportation; and adequate shelter, healthcare and other human services; all of which require access to reliable forms of energy.”

AGF’s Green Guarantee Facility is expected to bring direct benefits in terms of climate change mitigation and adaptation as well as sustainable employment, poverty reduction and gender opportunity. Following the Paris Agreement which was a result of the COP-21 gathering, contributing to the reduction of CO2 emissions is a shared responsibility of all nations. The Green Finance space offers growing opportunities for contributions from Commercial Financial Institutions (Banks, Private Equity and Venture Capital). Green finance can present opportunities for commercial viability. Africa has the potential to achieve universal access to energy while reducing the carbon intensity of its growth. The continent has enormous solar, hydroelectric, geothermal potential. This translates into opportunities for African SMEs to turn environmental challenges into business opportunities.


For more information, please contact:

Rehema Kahurananga Cell +254 718 930511


About the African Guarantee Fund

Officially launched on 1st June 2012, AGF is a Pan-African non-bank financial institution founded by the government of Denmark through the Danish International Development Agency (DANIDA), the government of Spain through the Spanish Agency for International Cooperation and Development (AECID) and the African Development Bank (AfDB). Agence Française de Développement (AFD) joined AGF in 2015 followed by the Nordic Development Fund (NDF) in 2016. AGF aims to promote economic development, increase employment and reduce poverty in Africa by providing financial institutions with guarantees and other similar or related financial products specifically intended to support SMEs in Africa. In 2016, AGF launched a green guarantee facility aimed at unlocking finance for SMEs investing in low carbon, green growth and climate resilient development.



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