Swedfund invests USD 10 million in the ASEAN Frontier Markets Fund (AFMF) to promote job creation in Cambodia and Laos

One of Swedfund's goals is to invest in the most vulnerable and poorest countries, according to the OECD's definition. Cambodia and Laos are examples of countries in Southeast Asia that, according to the OECD/DAC list, are in the category of least developed countries. AFMF provides capital to strengthen and scale up regional growth-oriented SMEs that are key players in the private sector, to contribute to economic development.

- The investment in AFMF is a way for us to reach more small companies that can invest and create jobs that are so important in developing countries. It is a challenging context that means that both countries are characterized by high poverty and a great need for investments to create jobs with decent working conditions, says Sofia Gedeon, Head of Sustainable Enterprises at Swedfund.

Before the pandemic, Cambodia was one of the fastest growing economies in the world. However, the country was hit hard by the pandemic and economic growth stalled, with the potential to reverse recent improvements in poverty. The country has emerged well from the COVID period and although still a challenging environment including the human rights situation, forecast resumed growth provides new opportunities for the fund and its companies to address poverty and contribute to equitable development.

Over the past twenty years, Laos has made great strides in development by halving poverty, reducing malnutrition, and improving education. However, economic growth has slowed down over the past two years and there is a risk that the country will fall back in development, absent renewed and responsible investments.

This is Swedfund's first investment in a fund focusing on Cambodia and Laos. AFMF will be managed by Emerging Markets Investment Advisers (EMIA), a Singapore regulated fund manager focused on frontier ASEAN.

The deal was signed on December 20, 2022.