Investing for continued support to SMEs in Central and East Africa
Introduction
March 11, 2024, Swedfund invests 15 MUSD in African Rivers Fund IV, an impact-oriented credit fund empowering sustainable growing companies in Central and East Africa, including the Democratic Republic of Congo, Angola, and Zambia, to increase access to long-term small and medium-sized enterprise (SME) financing and support for sustainable private sector growth.
With over 40 years of experience of sustainable investments in least developed countries (LDCs), Swedfund aims to make a significant impact. This includes investing in fragile countries such as the Democratic Republic of Congo, which is currently facing a humanitarian crisis, and Zambia, experiencing a severe drought, with women often being the most vulnerable.
Through the investment in African Rivers Fund IV (ARF IV), Swedfund aims to contribute to sustainable private sector development via access to long term financing and value creation for SMEs, employment, and income generation as well as enhancing women economic empowerment. The investment is also expected to increase local tax generation and support workforce skill development in critical sectors (i.e., healthcare and logistics).
- We are very pleased to be part of ARF IV which is expected to generate significant impact on socio-economic development, in particular, through job creation as well as increased local income generation and tax generation. The fund manager, XSML Capital, also aims to actively advance women empowerment and gender equality, says Jakob Larsson, Senior Investment Manager at Swedfund.
XSML Capital is a fund manager with strong local presence that provides growth capital to SMEs, primarily in the form of debt. XSML Capital has more than 10 years of experience of investing in in SMEs in Central and East Africa. ARF IV will invest in sectors like manufacturing, logistics and healthcare.
Swedfund has previously invested in the manager’s third fund, African Rivers Fund III in 2020, and made an additional investment in 2022. Other investors in African Rivers Fund IV are British International Investment, the UK’s development finance institution, FMO, the Dutch Entrepreneurial Development Bank, the International Finance Corporation (IFC), Norfund, the Norwegian Investment Fund for developing countries and SIFEM, the Swiss Investment Fund for Emerging Markets managed by ResponsAbility Investments.
Website: XSML Capital