New investment by companies across Tanzania will benefit from EUR 540 million (TSh 1.3 trillion) of new financing backed by the European Investment Bank, CRDB, NMB and KCB-Tanzania announced at the EU-Tanzania Business Forum in Dar es Salaam earlier today.
The European Investment Bank’s first engagement in Tanzania for seven years includes expected targeted support for EUR 170 million new investment by female led companies across the country and EUR 100 million investment in blue economy firms. The dedicated support to blue economy investments represents the largest EIB support for targeted blue economy business financing anywhere in the world.
The new social and development impact of the new initiative will be enhanced by innovative blended financing backed by the European Union. This includes enabling first-time borrowers to access finance and more companies to benefit from the scheme.
The largest ever business financing engagement by the EIB, the world’s largest multilateral bank was signed by Thomas Östros, EIB Vice President and Abdulmajid Nsekela, Group CEO and Managing Director of CRDB Bank, Aziz Chacha, NMB Bank’s Treasurer and Cosmas Kimario is KCB Group Regional Businesses Director and Managing Director KCB Bank Tanzania in the presence of H.E. Dr Hussein Ali Mwinyi.
“The European Investment Bank is pleased to return to Tanzania and confirm our largest ever support for targeted investment by entrepreneurs and businesses across the country. The new business financing cooperation between the EIB, CRDB, NMB and KCB will unlock EUR 540 million of new investment by Tanzanian business, including female led companies and blue economy firms. The new business financing confirmed today in Dar es Salaam demonstrates the close cooperation between Tanzania and European partners to ensure that Tanzanian companies can expand, create skilled jobs and explore new business opportunities in the years ahead.” said Thomas Östros, European Investment Bank Vice President.
“The EUR 150 million EIB loan to CRDB Bank will enhance access to finance by micro, small and medium-sized enterprises across Tanzania, and includes dedicated financing for women-led businesses and blue economy enterprises. The EIB backed credit line will support business growth, contribute to gender equality and empowerment of women and enable blue economy companies to invest in a better future. It was an honour to enable Vice President Östros and his colleagues to see at first-hand how CRDB Bank’s business clients are creating jobs and developing skills” said Abdulmajid Nsekela, Group CEO and Managing Director of CRDB Bank
“The new EUR 100 million EIB backing for NMB will allow businesses across Tanzania to grow. The dedicated focus on supporting women-owned businesses and advancing investment in the blue economy will harness Tanzania’s full potential and overcome long-standing barriers to investment and job creation.” said Aziz Chacha, Treasurer for NMB Bank
“KCB Tanzania and the EIB share the same commitment to ensure that Tanzanian companies can access finance and invest in a better future. This new EUR 20 million cooperation comes at the right time for businesses here in Tanzania and will enable women-owned businesses to become more efficiency while helping the country to attain an inclusive economy. Also, this fund will boost innovation in harvesting blue economy opportunities for a more sustainable future.” said Cosmas Kimario, KCB Group Regional Businesses Director and Managing Director of KCB Bank Tanzania.
“The European Union is committed to accelerating private sector development in Africa. The new cooperation between EIB Global, CRDB, NMB and KCB confirmed at the EU-Tanzania Business Forum in Dar es Salaam today will enable Tanzanian companies to invest and create jobs, ensure that companies led by women can expand and allow blue economy firms to create jobs and explore new markets in the years ahead.” said Ambassador Manfredo Fanti, Head of the European Union Delegation to Tanzania and the East African Community.
EUR 170 million dedicated backing to help female business to grow An estimated 75 percent of women-owned businesses in Tanzania do not have access to the finance they need due to challenges including lack of collateral or limited awareness of available financial products
The new EIB backed business financing initiative includes targeted investment that will unlock EUR 170 million of new investment in companies owned by women. The investment is compliant with the 2x Criteria, the global industry standard for gender lens investing. In 2019, EIB was the first multilateral development bank to adopt the 2x criteria.
The Tanzania investment also counts towards EIB’s SheInvest initiative that ist mobilizing EUR 2 billion to boost women’s economic empowerment across Africa, Latin America and Asia.
Increasing access to quality financial products and services by women entrepreneurs is essential across the world. Globally, SMEs play a vital role in enhancing and growing local economies. However, these businesses, especially women-owned business, were found to face the greatest hurdles in accessing growth finance capital.
Research confirms that women entrepreneurs often find themselves as part of the “missing middle”, i.e., private businesses often perceived to be too small or too risky to receive traditional sources of commercial financing. In Tanzania 48% of adults are still excluded from formal financial services, with a 13% points gender gap.By providing attractive financing terms subject to lending to female-led companies, the EIB is supporting the financial inclusion of women in the Tanzanian economy.
Largest ever EIB support for blue economy business investment The new initiative will enhance access to finance by blue economy business and is expected to enable EUR 100 million of new investment by both marine based fishing, maritime transport and tourism companies and marine related business such as seafood processing, ports and shipbuilding, as well as reducing the impact of land-based industry on the marine environment.
Sharing targeted business financing best practice Implementation of the new initiative is expected to be enhanced by sharing technical and financial best practice, gender financing and blue economy investment expertise through technical assistance programmes and other financial support backed by the European Union through the European Commission’s Africa Investment Platform.
The new initiative is aligned with the EU Global Gateway’s priorities, including improving access to finance, with a particular focus on women owned or managed businesses and enterprises.