News from 2017-06-27 / DEG
DEG, I&M Bank and AHK Kenya sign agreement on first "German Desk" in Africa
DEG and its local partner I&M Bank in Kenya and the local delegation of German business (AHK) have agreed to soon open the first "German Desk – Financial Support and Solutions" on the continent of Africa. A Memorandum of Understanding to this effect has now been signed in the capital city of Nairobi, in the presence of the Kenyan Ministry of Industry, Trade and Cooperatives, Adan Mohammed.
The German Desks are a joint initiative of the Association of German Chambers of Commerce and Industry (DIHK) and DEG, supported by the Federal Ministry for Economic Cooperation and Development (BMZ), to provide active financing services and financing solutions in particular to German small and medium-sized enterprises, for their business relations in developing and emerging-market countries. Kenya is the largest economy in East Africa and in 2015, economic growth totalled 5.6 percent. The World Bank has forecast growth of between five and six percent for the coming years.
Growing interest from German companies
German business interest in Kenya has grown steadily over the past few years and DEG has already supported several German companies doing business in East Africa. One example is the Kenyan flower producer Selecta One. But the market still offers great potential, also to German SMEs as German know-how and products are in high demand there. In addition, the activities of German companies contribute to fostering the private sector in Africa and in doing so create jobs and improve prospects for the local population.
To make it easier for German companies to get started in East Africa, and at the same time to support their local trading partners, DEG is setting up a "German Desk – Financial Support and Solutions" in collaboration with the I&M Bank and the delegation of German business. The German Desk is to be opened in September.
One-stop bank services and financing options for German SMEs in Kenya
In future, one-stop bank services and financing options will be on offer to German companies and their local trading partners. German and local business alike will have access to the extensive network of I&M Bank, the AHK, the embassy and DEG, and to customised financial solutions for exporting small to medium volumes of goods. DEG and its partners will thus contribute to preparing subsequent direct investments of German SMEs. Local companies will receive financing solutions for purchasing German plants and equipment or services.
"We are proud to make continental banking history as the first Bank in Africa to host a fully-fledged German Desk as part of our commitment to improve banking services in this market." said Kihara Maina, CEO of I&M Bank Kenya at the contract signing ceremony.
"The I&M Bank has been a partner of DEG for many years. The German Desk in Kenya means that German SMEs will receive access to financial solutions needed for expanding their business relations in East Africa and make direct use of the partners' local network," explains Christiane Laibach, member of the Management Board of DEG, at the contract signing ceremony.
DEG is opening up its network to the partner bank for use by the German Desk and providing long-term funds to extend as financial solutions to local customers of German firms. The I&M Bank’s interregional networks will also reach neighbouring markets.
Michael Derus, German Deputy Ambassador and Head of Economic Affairs, emphasized "This innovative service puts a new set of tools at the disposal of the actors of bilateral trade and direct investment in Kenya and thereby opens up the chance to both the Kenyan and German business communities of making use of a broader range of chances and opportunities."
Maren Diale, Country Director of the Delegation of German Industry and Commerce added that the extended opportunities for financing for local companies will be crucial for fostering the further industrialization of the region.
DEG's first German Desk has already been operating successfully in Peru since the beginning of 2017. Further German Desks are planned for Nigeria and Indonesia.
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