Tuesday, 09. February 2010
DEG: New business in Africa at record high
- New commitments once more above the one billion-euro threshold despite the economic crisis
- Commitments in Africa for the first time above 25 per cent
- Over 160 million euros for climate-protection projects
For the third time in succession, DEG – Deutsche Investitions-
und Entwicklungsgesellschaft mbH, has achieved new business
commitments of more than one billion euros. Last year, it provided
around 1.01 billion euros to finance private-sector investments in
developing and emerging-market countries (2008: 1.22 billion
euros). “It is particularly at a time of significantly declining
cash-flow into developing countries that entrepreneurial
development cooperation is required to boost private-sector
commitment,” said Bruno Wenn, chairman of DEG’s Board of
Management, on the occasion of the annual press conference in
Cologne.
Especially during the first six months of 2009, demand for
long-term finance and venture capital had been lower than expected
owing to the investment reserve of many companies. With the economy
recovering over the year and the reduced offer of commercial
finance, the request for DEG finance considerably increased towards
the end of the year. The total commitment of DEG – the portfolio at
own risk – increased by approximately four per cent to 4.6 billion
euros as per 31 December 2009.
Regional and sectoral focuses
For the first time, DEG made more than one-quarter of its new
business in Africa, where it committed a total of 266 million
euros, corresponding to an almost 50 per cent increase as against
previous year (2008: 179 million euros). “By this, we managed to
further expand the promotion for this developmentally important
continent in a challenging business year,” said Bruno Wenn. The
majority of the commitments during the past year once more went to
Asia, where DEG invested 463 million euros (2008: 451 million
euros). In Latin America, new business was at 198 million euros
(2008: 342 million euros) and in the region of southeast and
eastern Europe, new commitments accounted for 80 million euros
(2008: 249 million euros). An essential part of DEG’s mandate is to
accompany German investors. Last year, DEG co-financed foreign
investments of German enterprises with an amount of 137 million
euros (2008: 165 million euros). The German medium-sized company
Schwenk, for instance, is currently building the first cement works
in Namibia with financial support of DEG.
As regards industries, DEG’s focus was once more on the finance
sector. At 305 million euros, commitments in 2009 made up around 30
per cent of new business (2008: EUR 487 million euros; 40 per
cent). The focus was on financings for banks with a view to
improving the offer of financial services particularly for small
and medium-sized enterprise. As far as industrial companies are
concerned, DEG's share of new commitments accounted for 276 million
euros, or approximately 27 per cent. These companies make a
contribution to the creation of qualified jobs on the one hand, and
to boosting know-how and technology transfer, on the other. With an
amount of 251 million euros, infrastructure measures almost made up
one quarter of new business. Projects of agribusiness and food
industry accounted for 14 per cent. The share of venture capital
financing in form of participations and mezzanine loans totalled
379 million euros and thus accounted for 37 per cent of new
business.
DEG provided more than 160 million euros for projects with
particularly high contributions to climate protection.
Development effects
Together with the companies financed in 2009, DEG promoted
around 196,000 jobs with 15,200 of them being new jobs.
Furthermore, the co-financed enterprises will contribute to
government revenues to the amount of approximately 570 million
euros a year and generate annual net foreign exchange of around 1.7
billion euros.
An additional developmental accent is the Public-Private
Partnership (PPP) Programme, which DEG has been running on behalf
of the Federal Ministry for Economic Cooperation and Development
(BMZ) since 1999. Last year, DEG supported 57 of these PPP projects
with 9.9 million euros from public funds.
“In 2010, the promotion of small and medium sized enterprise will
be of particularly high priority for us,” said DEG chairman Wenn
with regard to the plans for the current year. “The importance of
small and medium-sized enterprise for the private sector in
developing countries cannot be prized enough.” Moreover, DEG is
planning to further extend climate finance, mainly in the field of
renewable energy, in 2010. The commitment in the insurance sector
is also intended to be enhanced further. For 2010, DEG assumes an
economic recovery of the markets in its partner countries and an
increasing demand for its long-term finance. It is therefore
planning to once more step up its new business volume to 1.1
billion euros for this year.
Attached please find a Pdf-File for downloading.
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