Johannesburg Stock Exchange, allies, join hands with African Development Bank to spur cross-border investments in Africa

AfDB NEWS & EVENTS

29-Nov-2019

The Johannesburg Stock Exchange (JSE), working with seven African exchanges, the African Development Bank and the African Securities Exchanges Association (ASEA) hosted the African Exchange Linkage Project (AELP) Engagement Forum, designed to bolster investments into the continent.

The joint initiative will facilitate cross-border trading and settlement of securities across participating exchanges in Africa. It also seeks to unlock Pan-African investment flows, promote the diversification needs of investors and address the lack of depth and liquidity in Africa’s financial markets.

In his opening remarks, Emmanuel Diarra, Manager of Capital Markets and Development at the African Development Bank stated: “The African Development Bank has a long history and partnership with the African Securities Exchanges Association. This partnership compliments the Bank’s interventions toward the development of deep and resilient capital markets in Africa.”

 “The Bank will continue to enhance its work with regulatory institutions, institutional investors, stock exchanges and other capital market stakeholders to strengthen regulatory frameworks, broaden market participation and product offerings, as well as improve the dissemination of capital markets data for transparent pricing mechanisms” Diarra said. 

The AELP, which started in 2016 with only four exchanges, has since expanded to seven participating exchanges. They are the JSE, the Egyptian Exchange, Stock Exchange of Mauritius, the Casablanca Stock Exchange, Nairobi Securities Exchange, the Nigerian Stock Exchange and Bourse Régionale des Valeurs Mobilières which serves Francophone West Africa. The long-term goal is for all 27 African stock exchanges to join the Project and increase Africa’s competitive advantage compared to other emerging markets.

The seven Stock Exchanges participating in the first phase of the AELP represent about 85% of Africa’s securities market capitalization.

The AELP has aligned its goals to include the creation of a central trading platform linked to exchange trading systems; the free flow of trading information between linked exchanges; broker access to the linked trading platform, and the creation of products based on securities from the allied exchanges.

Anne Clayton, Head of Public Policy at the JSE said: “The AELP is a great addition to many collaborative initiatives around Africa. As the JSE, our focus is to enable sustainable and inclusive growth and development, not only in South Africa but on the continent as well. There is great interest within Africa for investment, and the AELP provides an opportunity for alignment of exchanges within the continent, therefore collaborations with key stakeholders will continue to be at the centre of securing a growth path for Africa.”

 ABOUT THE JSE

The Johannesburg Stock Exchange is based in Johannesburg, South Africa where it has operated as a marketplace for the trading of financial products for 132 years. It connects buyers and sellers in equity, derivative and debt markets. The JSE is one of the top 20 exchanges in the world in terms of market capitalization and is a member of the World Federation of Exchanges (WFE). The JSE offers a fully electronic, efficient, secure market with world class regulation, trading and clearing systems, settlement assurance and risk management. www.jse.co.za

Contact: 

Hola, Madrid! African Development Bank takes the continent’s climate agenda to COP25 in Spain

AfDB NEWS & EVENTS

The Bank is playing a leading role in guiding progress on climate change on the continent. The Bank has doubled its total climate change commitment to $25 billion between 2020 and 2025.

29-Nov-2019

The African Development Bank will on Monday kick off a campaign to present the continent’s case at the world’s leading climate change conference.

The 25th session of the United Nations Framework Convention on Climate Change (UNFCCC) Conference of the Parties (COP) comes at a crucial time for the globe and Africa in particular. In recent years, rising temperatures have wreaked havoc with weather patterns, leading to suffocating heat and devastating storms. In Africa, the climate has exacerbated food shortages and destroyed infrastructure.

African countries know all too well the risks posed by climate change, said Wale Shonibare, the Bank’s Acting Vice President for Power, Energy, Climate Change and Green Growth. He cited the devastating impact of Cyclones Idai and Kenneth in Mozambique, Zimbabwe, Malawi, Tanzania and the Comoros earlier this year.

“However, Africa also offers climate smart investment opportunities – from country-led innovation centers, to transformative renewable energy initiatives. For example, this year, the Bank approved financing for the first on-grid solar power public-private partnership in Chad, under the Desert to Power initiative,” Shonibare said.

Projects like Desert to Power will be highlighted at COP 25, which will from 2 to 13 December bring together leaders and institutions from 196 nations plus the European Union, who have signed up to the United Nations Framework Convention on Climate Change.

At the heart of the matter are the Nationally Determined Contributions, or NDCs, which form part of the landmark Paris Agreement, signed in 2015 during COP21 in the French capital. The NDCs are specific climate change targets that each country must set.

The Paris Agreement has been ratified by 51 out of 54 African countries. It binds countries to cutting carbon emissions to ensure that global temperatures do not rise by more than 2°C by the end of this century, while attempting to contain it within 1.5°C.

Climate finance is another issue that will top the agenda at COP25 in Madrid.

“2020 is a critical year in securing adequate resources for African countries to meet their Paris Agreement commitments, clarity and transparency on global climate finance access is essential to deliver climate action faster and at scale,” said Anthony Nyong, Director Climate Change and Green Growth Department at the African Development Bank.

The African Development Bank is joining the other Multilateral Development Banks (MDBs) in a pavilion to showcase the joint commitment to combatting climate change. The Bank will participate in several panel discussions at COP25, and will support the advocacy efforts of its regional member countries. The Bank is playing a leading role in guiding progress on climate change on the continent. Some of its achievements are:

• More than 50% of 2019 climate finance allocated to adaptation projects.
• 85% of investments are screened for climate risk and for greenhouse gas emissions. The Bank’s ambition is to screen all projects by 2020.
• By next year, 40% of the Bank’s own investments will be dedicated to climate finance.
• The Bank has doubled its total climate change commitment to $25 billion between 2020 and 2025, with more than half of it going to adaptation

Guinea-Bissau: African Development Bank presents the Lusophone Compact to private sector at Economic Forum

AfDB NEWS & EVENTS

The African Development Bank presented the Lusophone Compact to the private sector in Guinea-Bissau last month, during an event at the national Economic Forum.

The Lusophone Compact, a financing platform involving the African Development Bank, Portugal, and the six Portuguese-speaking countries of Africa (PALOPs), provides risk mitigation, investment products and technical assistance to accelerate private sector development in Lusophone African countries (Angola, Cabo Verde, Equatorial Guinea, Guinea-Bissau, Mozambique and Sao Tome and Principe).

About 100 participants, including government representatives, international partners, local and foreign investors, attended the government-sponsored event, which was also attended by Guinea-Bissau Minister of Economy and Finance Geraldo Martins, and Antonio de Carvalho, Portuguese Ambassador to Guinea Bissau.

Opening the session, Martins described the occasion as “an important event to ensure that local stakeholders have a full understanding of the tools available.” He told attendees that the event followed the signing of the Lusophone Compact on  26 July 2019, in the presence of Teresa Ribeiro, Secretary of State for Foreign Affairs and Cooperation of Portugal.

Ambassor de Carvalho, highlighted the importance of the Compact to strengthen the Lusophone cooperation in Africa, mentioning the commercial and risk mitigation garantees to be offered by Portugal.  

Joel Muzima, Bank principal country economist for the Bank, highlighted the positive partnership between the Bank and the Government of Guinea-Bissaua, reflected by the growing portfolio in areas of governance, agriculture and infrastructure development.  He urged the private sector to present bankable projects to take advantage of the Lusophone Compact and leverage financial resources for development. 

Projects eligible under the Compact are expected to align with the Bank’s development priorities, relevant country strategy papers and national development plans and involve the host country and at least two other Compact signatories. Focus will primary be on renewable energies, agribusiness and agricultural value chains, water and sanitation, infrastructures, tourism, financing and ICT.

There is also the provision for technical assistance projects to accelerate private sector and PPP growth.  In Guinea-Bissau and elsewhere, project preparation has been identified as one of the main impediments to making projects bankable.

Nigeria: African Development Bank approves $210 million financing for Transmission Expansion Project

AfDB NEWS & EVENTS

The Board of Directors of the African Development Bank Group has approved a $210 million financing package to the Federal Republic of Nigeria, for the Nigeria Transmission Expansion Project (NTEP1), which seeks to rehabilitate and upgrade the nation’s power lines and improve distribution and supply. 

The project, which will run across the states of Kano, Kaduna, Delta, Edo, Anambra, Imo, and Abia, will improve the capacity and reliability of the Nigerian transmission grid where it is most constrained. Executed by the Transmission Company of Nigeria), NTEP1 is part of a $1.6 billion Transmission Rehabilitation and Expansion Programme (TREP).

“Nigerians and their businesses spend $14 billion annually on inefficient and expensive petrol or diesel-powered generators. This project will contribute significantly to the reduction of Nigeria’s power deficit, decrease air and noise pollution and reduce the cost of doing business,” Ebrima Faal, the Bank’s Senior Director for Nigeria, said.

The Bank’s financing, comprising a $160 million loan, and an additional $50 million loan from the Africa Growing Together Fund, will support construction of 330kV double circuit quad transmission lines and substations across the country. The project will upgrade existing 263 km of 330kV lines, while adding an additional 204 KM of new lines to increase TCN’s wheeling capacity, stabilize the grid and reduce transmission losses.
Upon completion, the project will significantly improve Nigeria’s electricity supply, and directly impact the economy, industries, businesses and the quality of life of Nigerians.

The project will also reduce the use of small-scale diesel generators and therefore contribute to the reduction of GHG emissions by saving approximately 11,460ktCO2 per year. The project will create about 2,000 direct jobs- 1,500 during construction and 500 during operations - especially for youth: 30% of these jobs are expected to be taken by women.  By increasing electricity supplies to Small and Medium Enterprises, the project will foster the creation of additional indirect jobs.

Wale Shonibare, the Bank’s Acting Vice-President for Power & Energy said implementation of the project would increase evacuation capacity from the south of the country towards the north, where power supply is limited.   “NTEP1 will increase the grid transmission stability and capacity, and reduce the amount of stranded power, whilst improving power export and regional power system integration to the West African Power pool, especially through Niger and Benin interconnections,” he said.

Highlighting the project’s contribution to regional integration efforts, Batchi Baldeh, the Bank’s Director for Power Systems Development said it would benefit from the Bank’s expertise and proven track record in leading the development of power grids across the continent, notably in West Africa, with many successful operations supporting the implementation of interconnectors. “In line with our work to improve utility performance, NTEP1 will substantially strengthen the capacity of TCN with regards to the development of energy infrastructure projects, especially the adoption of modern and more efficient transmission technologies, which are most required in Nigeria for network improvements,” said Baldeh.

NTEP-1 is part of the Bank’s response to the power sector crisis in Nigeria and is aligned with the government’s strategic plans articulated in its Economic Recovery and Growth Plan (2017-2020) and Power Sector Recovery Programme. The project also aligns with the Bank’s High 5 priority to ‘Light up and Power Africa” and the New Deal on Energy in Africa.

Donors to announce financing package for Africa’s low-income countries as ADF-15 Replenishment concludes

“Creating an Enabling Environment for Inclusive and Sustainable Growth and Transformation, Decent Jobs and Greater Resilience”

Event date: 

04-Dec-2019 (All day) to 05-Dec-2019 (All day)

What: 15th Replenishment of the African Development Fund (ADF)

Who: The African Development Fund, Donor Governments

When: 4-5 December 2019

Where: African Pride Irene Country Lodge, Centurion, South Africa

Representatives of donor governments will meet from 4-5 December in Centurion, South Africa, to conclude the 15th Replenishment of the African Development Fund (ADF) with a financing package for Africa’s low-income countries for the period 2020-2022.

Representatives of beneficiary member countries will also participate in the deliberations, focusing on the needs and priorities of ADF countries and measures and resources to address them.

Over the past 45 years, the African Development Fund has played a central role in providing concessional resources to low-income African countries while demonstrating clear value for money to both donors and recipients. The Fund has also provided catalytic financing and policy advice to help countries deliver essential services that help accelerate growth and protect vulnerable communities.

The results associated with its operations have changed the lives of millions of Africans, making the ADF a trusted and strategic partner for all its stakeholders.

The Strategic Pillars of ADF-15 include (i) providing quality and sustainable infrastructure to support economic transformation and promote regional integration; and (ii) delivering human, governance and institutional capacity to promote inclusive growth and decent job creation.

ADF will scale up support to the most vulnerable and to those countries facing fragility and it will aim to tackle the root causes of fragility and strengthen resilience of its eligible countries by systematically using a fragility lens in its operations design.

It will also give a special attention to cross-cutting issues such as gender mainstreaming, climate change, governance, private sector development and job creation.

Journalists are invited to cover the opening plenary of the meetings on Wednesday, 4 December 2019 at 8 am.

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About the ADF

The African Development Fund (ADF) is the concessional window of the African Development Bank Group. Established in 1972, it became operational in 1974. Administered by the African Development Bank, it comprises, to date, 32 contributing countries and benefits 37 countries. The 37 ADF-eligible countries include those that are increasing their economic capacities and heading toward becoming the new emerging markets—as well as those that remain fragile and need special assistance for basic levels of service delivery. The ADF has the challenge of having more than half of its client countries facing situations of fragility where even stable economies remain highly vulnerable to internal or external shocks.

AEC 2019: Only a competitive youth will guarantee Africa’s sustainable inclusive economic growth – African Development Bank Chief Economist Charles Lufumpa

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25-Nov-2019

The youth of Africa must be empowered to be competitive in order to play a more meaningful role in the continent’s economic transformation drive, urged African Development Bank’s Acting Chief Economist and Vice-President for Economic Governance and Knowledge Management, Charles Lufumpa.

“A skilled and empowered youth workforce is a valuable asset that can help African economies accelerate the momentum of their structural transformation and economic development,” Lufumpa said ahead of the 2019 African Economic Conference (AEC), scheduled to open next week in the Egyptian resort city of Sharm El Sheikh.

Since its inception in 2006, the AEC has fostered the exchange of knowledge on challenges facing Africa. The forum is being hosted jointly by the African Development Bank, the Economic Commission for Africa and the United Nations Development Programme on the theme: “Jobs, Entrepreneurship and Capacity Development for African Youths”.

Lufumpa believes this year’s forum offers an “ideal opportunity” to revisit the debate on educating African youth and improving their jobs, skills, and capacity in light of recent continental and global structural changes.

“It is also the appropriate avenue for stakeholders to discuss innovative and successful practices to educate the youth, improve their skills, and create quality jobs amid high youth population growth and the current disruptive technological transformation,” said the Bank’s Chief Economist. 

While welcoming efforts by some African countries in adopting good policies on youth employment, Lufumpa hopes the Sharm el Sheikh dialogue, which is expected to rally together more than 350 participants, will produce “concrete, bold, and implementable” policy actions.

Nearly half of the speakers invited to the forum are young researchers below 35 years old. “We want them to raise their voices, interact with policymakers, private sector actors including multinational firms such as Safaricom, Microsoft, MasterCard, and LinkedIn, as well as development practitioners such as UNESCO, the ILO, the Bill and Melinda Gates Foundation and the Rockefeller Foundation to share their thoughts on jobs, entrepreneurship and capacity development,” Lufumpa added.

“Youth employment and empowerment require concerted efforts by governments,” he said, adding that the youth are knowledgeable enough to explain the difficulties they face and provide feedback on why some policies have failed to solve unemployment problems in Africa.

The African Development Bank is in the forefront of the continent’s drive to empower and create jobs for the youth. It is implementing a 10-year strategy (2016–25), “Jobs for Youth in Africa”, designed to provide funding for micro, small, and medium-sized enterprise (MSME) and skills development programmes for the youth in high-priority sectors.

The strategy, currently implemented in a dozen African countries, aims to directly create 25 million jobs and positively impact 50 million youth by 2025.

Lufumpa will lead the Bank’s delegation to the three-day Sharm el Sheikh meetings.

2019 Conference on Land Policy in Africa: Technology and innovation will help speed up removal of land sector corruption in Africa - African Development Bank

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25-Nov-2019

African countries must act faster to purge corruption in the land sector by harnessing technology and innovation, African Development Bank Senior Vice President Charles Boamah urged on Monday.

Boamah, who was speaking to policymakers and stakeholders at a conference on Land Policy in Africa in the Ivorian capital, Abidjan, also called for the deployment of more financial and human resources to land policy development, “especially in rural areas and among the most vulnerable, including women.”

The biennial conference, organized by the Land Policy Centre, provides a central platform for African stakeholders to network and deepen their commitment to land policy development, implementation and monitoring, through access to knowledge and evidence-based policymaking.

This year’s dialogue, hosted by the African Development Bank, is on the theme: “Winning the Fight against corruption in the Land sector: Sustainable pathways for Africa’s transformation”.

According to globally, one in five persons has paid a bribe for a land service. In Africa, every client of a land administration service has paid a bribe.

“This corruption takes many forms — bribery or illicit land transactions is just one example. Land developers and speculators specifically target countries with weak governance systems. Local powerful elites are also more likely to manipulate such systems to serve narrow ends not to benefit the public,” Boamah noted.

The African Development Bank is committed to working with its partners to improve governance in land administration as part of efforts to boost agriculture production. Two of its key initiatives- the , have demonstrated innovation in this area.

Agriculture remains the backbone of many African economies. But sound land policy and administration are needed to bring it in line with 21st-century practice, Boamah said.

The TAAT program has worked with 30 seed companies to produce 27,000 metric tonnes of drought-resistant maize seeds. By the end of 2018, more than 1.6 million farmers had planted these seeds.

Connect Africa initiative — a $55 billion global partnership to bridge major gaps in ICT infrastructure across the continent — is allowing farmers to use digital technology to access prices and services like mobile banking.

Ivorian Justice Minister Sansan Kambile called on African states to prioritise land tenure security as a development objective.

“Without land tenure security, and the various implications, no development can be sustainable. It is a collective responsibility which we must pursue to leave a worthy legacy for future generations” he said.

Kambile said the Ivorian government is keen to see workable outcomes from the Abidjan meetings for adoption into its land administration system.

In her welcome remarks, Sacko Correia, Commissioner for Agriculture and Rural Economy at the African Union Commission, noted that corruption in the land sector has undermined cohesiveness and led to conflicts on the continent.

“For us to win the fight against corruption, we must ensure that land is equitably distributed and accessed by all, most especially by women, youth and other vulnerable groups,” she said, noting that although women contribute significantly to agriculture production in Africa, they enjoy less rights to land.

She called on African governments to ensure that land management processes are transparent, accountable, efficient and responsive to the new challenges of climate change, natural disasters and environmental degradation.

Stephen Karingi, Director, Private Sector Development and Finance, United Nations Economic Commission for Africa, said an effective land governance will help reduce cost of doing business in Africa and help contribute immensely to the African Union’s Agenda 2063 master plan for transforming Africa into the global powerhouse of the future.

This year’s theme is aligned to the African Union’s declaration of 2018 as Africa’s Anti-Corruption Year. The continental body identifies corruption as a key factor hampering efforts to promote governance, socio-economic transformation, peace and security.

The conference will run from 25th to 29th November.

https://www.afdb.org/en/events/CLPA2019

First ladies panel seeks urgent policies to translate Africa’s demographic dividend into viable potential

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“What a man can do, a woman can do just as well,” Jeannette Kagame, First Lady of Rwanda

“History will judge us if we don’t work together to take action now,” Chief Executive Officer of the Tony Elumelu Foundation, Ifeyinwa Ugochukwu

26-Nov-2019

“Investments in gender equality are critical to realizing demographic dividend, but we need to ensure that women have the tools to overcome the barriers they face,” First Lady of Rwanda, Jeannette Kagame told participants at a panel at the Global Gender Summit in Kigali on Monday.

The panel, made up of First Ladies Kagame, Margaret Kenyatta, ministers and development experts, observed that too many women and girls still face barriers to basic rights, particularly access to labour market opportunities.

Rwanda’s First Lady recalled the role women played following the 1994 Genocide against Tutsi, where a number of families were wiped out, with women in many cases being the ones catering for families.

“What a man can do, a woman can do just as well,” she added.

She described the Summit as an important platform to highlight issues of women equality.

Rwanda has implemented gender several inclusive programs, which has enhanced economic equality in a country where women political participation has grown to 61% percent.

First Lady Kenyatta called for the removal of institutional barriers to accelerate women’s economic empowerment, “It has become urgent for Africa to translate its demographic dividend into viable potential.”

“This is the spirit of Africa’s vision to accelerate its path to sustainable socio-economic development. Our collective commitment to ‘leave no one behind’ is a new chapter in our struggle towards achieving gender equality.”

The panel heard that impediments to gender equality include lack of access to credit, low representation in decision making positions, lack of control over productive land and lack of financial control to make spending decisions on education and health.

Minister of Solidarity, Social Development, Equality and Family Jamila El Moussali of Morocco,

shared experiences from Morocco where policies have been introduced to increase women's political and economic participation.

The Chief Executive Officer of the Tony Elumelu Foundation, Ifeyinwa Ugochukwu, called on stakeholders to come together to leverage each other’s strengths “translate women dreams into reality. History will judge us if we don’t work together to take action now.”

The African Development Bank and the government of Rwanda are hosting the Global Gender Summit from 25 to 27 November in Kigali. The Summit is being organised by the Multilateral Development Banks’ (MDBs) Working Group on gender for the first time in Africa.

African Development Bank approves $400 million to support Mozambique’s ambition to become global LNG player

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26-Nov-2019

The Board of Directors of the African Development Bank Group on Thursday approved a long-term Senior Loan of $400 million to support the building of an integrated Liquefied Natural Gas (LNG) plant, including a liquifaction facility in Mozambique.

The Mozambique LNG Area 1 Project, ranked Africa’s single largest Foreign Direct Investment to date, comprises a global team of energy developers and operators, led by Total alongside Mitsui, Oil India, ONGC Videsh Limited, Bharat Petroleum, PTT Exploration, as well as Mozambique’s national oil and gas company ENH.

By its approval, the African Development Bank joins a global syndicate of commercial banks, development finance institutions, and export credit agencies, to jointly provide the requisite senior debt financing for the project. Financial close is expected within the first half of 2020.

Commenting on the approval, Bank Group President Akinwumi Adesina said: “Through its participation, the African Development Bank again demonstrates its leading role in supporting Africa’s transformation. The catalytic effect brought about by the Bank is strategically aimed to help transform Mozambique from ‘developing’ to ‘developed’ nation.”

“Working closely with the Government of Mozambique, we can ensure that the local population reaps the benefits from its nascent natural gas value-chain, thus creating growth opportunities and widespread industrialization, while at the same time accelerating regional integration across Southern Africa,” Adesina added.

In June this year, the group of investors reached final investment decision on the project, which carries a price tag in excess of $20 billion, thereby facilitating the initial commercialization of one of the world’s most important gas discoveries in the past two decades.

The LNG liquefaction plant will have a production capacity of 12.88 MTPA. The Project is the first of several LNG trains expected to undergo development in the northern part of the country. Mozambique is expected to become one of the world’s largest LNG exporters and its gas represents an important source of supply diversification, which stands to benefit global energy markets.

Through this approval, the Bank carries a mandate to ensure the project’s adherence to international transparency standards and full compliance with environmental and social requirements, in line with its Integrated Safeguards System.

In addition, the Bank’s participation introduces key social and economic indicators into the loan monitoring, including areas such as job creation, gender empowerment, and linkages for small businesses. With a portion of the gas allocated to the domestic market, the Bank’s focus is on supporting economic diversification and industrialization in both Mozambique and across SADC.

The Bank’s involvement is consistent with its country strategy in Mozambique, which aims to leverage natural resources development to accelerate agricultural transformation and investment in sustainable infrastructure, the Board heard.

The Project also aligns with three of the Bank’s ‘High 5’ Strategic Priorities –(i) Industrialize Africa, through the anticipated industrial activity that domestic gas may generate in Mozambique and the larger Southern Africa region; (ii) Light Up and Power Africa, through the availability of gas to fuel power generation locally and regionally; and (iii) Improving the Quality of Life for the People of Africa, through the creation of thousands of jobs, local SME linkages, and gender empowerment, in addition to the positive impact on macroeconomic stability and the overall regional integration dynamics. 

The Project has already signed eight long-term off-take contracts with some of the world’s most prominent LNG players, including Bharat, Centrica, China offshore state-owned oil & gas producer CNOOC, Taiwan’s CPC Corporation, Electricite de France EDF, JERA, Pertamina, Shell, Tohoku Electric, and Tokyo Gas.

Since its first project in 1977 in Mozambique, the Bank Group has regularly provided significant and diversified support to the country’s development efforts, characterized by a well-balanced sector distribution.

Technical Contact: Fernando Balderrama, Chief Investment Officer, African Development Bank

“Women are an excellent investment”: finance leaders call for increased support for in women in business

26-Nov-2019

Leaders from multilateral development banks, financial institutions and the private sector called on peers to dispel myths about women being too “high risk” for financing - and to offer more financial services for women in business to close the gender finance gap.

“We know that women are a good bet. We know they pay back. We know they run excellent businesses – and yet they are not getting financed,” said Dr Jennifer Blanke, African Development Bank Vice President for Agriculture, Human and Social Development.

An important step is for multilateral development banks to offer credit guarantees to commercial banks to invest in women entrepreneurs, Blanke said.

“We know that if we provide those guarantees, then the banks are going to be lending to a lot more women, and they are going to discover that women are an excellent bet – and are an excellent investment.”

Blanke and other leaders were speaking at the “Using Innovative Financing Mechanisms to Accelerate Finance for Women in Business” plenary panel session at the Global Gender Summit on Tuesday.

The international gathering of gender champions from government, finance institutions, multilateral development banks, civil society and private industry, runs from 25 - 27 November in Kigali, Rwanda.

Panelists acknowledged that strides have been taken to bring gender equity to financing. However, according to World Economic Forum data, at current rates of progress it will take at least 200 years to close the global pay gap between men and women.

Asian Development Bank’s Gender Lead, Sakiko Tanaka, noted this 2019 Global Gender Summit has seen increased awareness of the need for women’s financial inclusion to achieve gender equality.

“There’s more money coming in for gender equality. However, there are still major gaps globally and as well as in each region,” said Tanaka, who also serves as chairperson of the multilateral development bank working group on gender.

Women face unique constraints such as poorer access to collateral and land, running smaller business compared to male entrepreneurs and blurred lines between women’s personal and professional finance spend.

Wendy Teleki, Head of the We-Fi (Women Entrepreneurs Finance Initiative) Secretariat and the panel moderator, led the six panelists in exploring how financial institutions and multilateral development banks are innovating to expand women’s access to finance. Aside from risk-sharing interventions like credit guarantees to lenders, panelists said increasing women’s financial literacy was also key to closing the gender gap.

“It’s not about corporate social responsibility or charity,” said panelist Barbara Rambousek, Director for Gender and Economic Inclusion at the European Bank for Reconstruction and Development. “It is about developing that business case and developing a proper set of financial and non-financial services.”

In Africa, 70% of women are excluded financially and there is a $42 billion financing gap between men and women. Yet panelist Solomon Lartey, Managing Director and CEO of Activa International Insurance Ghana sees opportunity, particularly in West Africa, home to what he says is the world’s highest rate of women entrepreneurs.

“To get women where they want to be, we had to walk with them. The first thing is training them [about financial services], then granting them access to legal assistance and to financial education – we have to do all those things,” Lartey said.

The panel also discussed innovations related to financial technology, alternative credit information, and online tools for financial services as a way to grow businesses.

In some developing regions of the world, women face challenges getting basic documents like a birth certificate, required by commercial bank applications.

Tesi Rusagara, the head of Kigali Innovation City, said the more services for documentation and financing tools are brought online, the more value will be created for women.

John Wilson, CEO of Equity Bank, added that it is important to not only use data and technology in financial services, but to also have a physical presence where clients are, to make a human connection.