The launch of its Mission 300 local currency that guarantees a facility targeting financing for small and medium-sized enterprises (SMEs) in the distributed renewable energy (DRE) sector, supporting an initiative led by the African Development World Bank Group and World Bank Group to provide electricity to 300 million Africans by 2030, has been announced on Wednesday by the African Guarantee Fund (AGF).
Aimed at mobilizing USD 5 billion (EUR 4.8bn)for energy access projects across Africa. The announcement of the new AGF facility was announced during the Africa Energy summit in Dares Salaam, Tanzania.
“The Mission 300 Local Currency Guarantee Facility will foster collaboration with African governments while utilizing concessional financing from the African Development Bank, the World Bank Group, and other development partners to expand local banks’ participation in financing Distributed Renewable Energy solutions,” said Wale Shonibare of the African Development Bank, who also serves as a non-executive director at AGF.
AGF is working to mitigate risks in SME lending and attract private sector investment into Africa’s energy transition by tackling systemic challenges such as high collateral requirements, currency mismatches, and the absence of long-term financing.AGF is a non-bank financial institution dedicated to supporting SMEs in Africa.
It was established in 2011 by the governments of Denmark and Spain, along with the African Development Bank. Since then, the French Development Agency (AFD), the Nordic Development Fund (NDF), the Danish Investment Fund for Developing Countries (IFU), and the German group KfW have also become investors.
