E.U. and SANAD dedicate USD 35 million to combating economic effects of COVID-19 pandemic in MENA region
New E.U. investment into impact fund SANAD will channel liquidity to financial institutions in Middle East and North Africa that support small businesses
Luxembourg, 30 September 2021 – The European Commission has invested USD 30 million into the SANAD Fund for MSME (SANAD) and committed an additional USD 5 million to the fund’s complementary Technical Assistance Facility. This boost in risk-absorbing capital will enhance SANAD’s ability to provide crucial support to financial institutions in the Middle East and North Africa that are serving micro, small, and medium enterprises (MSMEs) during the COVID-19 crisis.
SANAD promotes economic growth and employment by investing debt and equity into local financial institutions that are dedicated to MSMEs – a pillar of the economy in most countries of the Middle East and North Africa. The impact investment fund mobilizes capital from private investors through the risk cushion provided by impact-minded public investors. A major public investor since the fund’s foundation in 2011, the European Commission shares SANAD’s aim to build a strong financial infrastructure for local businesses as key to supporting income generation and opportunities. This new investment from the European Commission into the SANAD Debt Sub-Fund will enhance SANAD’s ability to provide much-needed liquidity to financial institutions serving MSMEs, a sector which has been especially hard-hit by the economic effects of the COVID-19 pandemic. The donation to the SANAD Technical Assistance Facility will facilitate non-financial support to institutions and entrepreneurs alike, such as consultation or training in crisis management.
SANAD Board Chairperson Dr. Daniela Beckmann said, “The E.U. has been a strong partner for SANAD since the beginning; we have an almost ten-year track record together of channeling funding where it is needed to tackle social and economic challenges. In times like these, entrepreneurs urgently need both financial and nonfinancial support to regain their footing. This additional funding from the European Commission will boost the ability of SANAD and its Technical Assistance Facility to help partners navigate to the other side of this crisis.”
Mr. Maciej Popowski, Acting Director General of the E.U. Directorate General for Neighbourhood and Enlargement Negotiations, said: “Local financial infrastructure has a critical role to play in helping micro, small, and medium-sized enterprises cope with the negative consequences of the COVID pandemic. Business owners are currently facing enormous obstacles, with ripple effects still ahead. By supporting the institutions these MSMEs rely upon, we aim to stabilize an important sector of the Middle Eastern and North African economies and help them weather the crisis.”
About SANAD
The SANAD Fund for MSME finances micro, small and medium enterprises and low-income households in the Middle East and North Africa via qualified local lenders. SANAD thereby fosters economic development and job creation – including youth employment – agriculture, affordable housing, and innovations in finance and financial technologies. SANAD strives to meet these goals by providing debt and equity financing to its local partners. The SANAD Technical Assistance Facility multiplies the fund’s development impact and outreach through capacity-building with partner institutions, developing financial infrastructures according to the principles of responsible finance and conducting much required R&D.
An impact investment fund advised by Finance in Motion, SANAD’s investors include the KfW Development Bank, which initiated the fund; the German Federal Ministry for Economic Cooperation and Development (BMZ); the European Union; Switzerland’s State Secretariat for Economic Affairs (SECO); OeEB, the Development Bank of Austria; Germany’s GLS Bank and GLS Treuhand; the Dutch development bank FMO; and Calvert Impact Capital.
For more information on the SANAD Fund for MSME, please visit: www.sanad.lu
For more information on Finance in Motion, please visit: www.finance-in-motion.com
Media contact – SANAD
Merle Römer
Manager, Marketing & Communications
Phone: +49 (0)69 / 271 035-171
Email: press@sanad.lu