The European Commission (EU) signed four guarantee agreements worth €216 million that will help unlock €2 billion to be invested in renewables, urban infrastructure and start-ups in Africa and the EU Neighborhood.
The guarantees were signed with the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), the German KfW Group and the Spanish development cooperation agency, Agencia Española de Cooperación Internacional para el Desarrollo (AECID), at the 4th Strategic Board meeting of the External Investment Plan (EIP), last week.
These guarantees will significantly boost investment in renewable energy (€50 million); support investment in sustainable energy (€46 million); increase access to finance for small businesses (MSMEs/ €20 million); and improve investment in urban infrastructure and services in Sub-Saharan Africa and in the EU Neighborhood, through the Resilient City Development or RECIDE (€100 million), the European commission said in a press release.
Commenting on these financial guarantees, Jutta Urpilainen, Commissioner for International Cooperation and Development, said, these guarantees share in the risk and help mobilize and attract public and private investments.
They will help boost the supply of renewable energy to communities and businesses in Africa and the EU Neighborhood, help small businesses invest and create jobs, and make African cities more resilient to growing populations and the effects of climate change, the commissioner said, adding this is an example of how the EU’s new Green Deal initiative benefits citizens of partner countries outside the EU.
Commissioner for Neighborhood and Enlargement Olivér Várhelyi said the EU wants to ensure an investment boost that will drive forward growth and provide concrete benefits and opportunities to the people, for example when it comes to big infrastructure projects or the support to young entrepreneurs. The direct support to investment is a key element, but so are good governance and a conducive business environment that helps attracting investment, both domestic and foreign, he added.