Press Release from 2021-03-30 / DEG
DEG presents its annual financial statements for 2020
Impact on development confirmed: DEG customers employ 2.3 million people
DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH can report a successful 2020 financial year in terms of development policy despite the very challenging environment created by the COVID-19 pandemic. DEG’s existing customers, for example, employed around 2.3 million people last year. What is more, they generated EUR 120 billion in local income in 2020 alone.
“Especially during the pandemic, DEG was, and indeed remains, a sought-after reliable partner for private companies in developing countries and emerging markets that have been hard hit by the consequences of the crisis. As a result, we focused on providing short-term liquidity support and specific COVID-19 response services to our customers”, emphasised Christiane Laibach, CEO of DEG’s Management Board. By way of example, EUR 50 million went into the co-financing of COVID-19-related measures via DEG’s advisory and promotional programmes alone in 2020, for example for promotional measures in the healthcare sector and for continued salary payments.
During the 2020 financial year, DEG enabled entrepreneurial investment of EUR 7.7 billion in developing and emerging market countries. It provided around EUR 1.4 billion for this purpose from its own funds and was able to mobilise a further EUR 378 million provided by private investors.
Improvement in operating result, increase in risk provisions
The operating result (operating result before risk provisions and valuation effects from currency) of EUR 200 million was up in a year-on-year comparison (2019: EUR 153 million). Net interest income and income from participating interests showed favourable development in 2020. In view of the heightened risks overall and the ongoing uncertainty created by the COVID-19 pandemic, DEG has expanded its net risk provisions considerably to EUR 359 million as a precautionary measure (2019: EUR 194 million). As a result, an annual net loss before taxes of EUR 179 million was recorded for 2020.
With an equity capital base of around EUR 2.3 billion and an equity ratio in excess of 37%, DEG continues to have adequate risk-bearing capacity to fulfil its development policy mandate.
2021 set to remain dominated by COVID-19 pandemic
In 2021, DEG expects to operate in an environment that will remain challenging and will continue to be dominated by the COVID-19 pandemic. “Our long-standing experience with entrepreneurial investments in volatile markets also helps us to provide our customers with prudent support in this current unprecedented situation”, says Christiane Laibach. As well as providing financing to companies, this support includes advisory services and promotional programmes tailored to suit their needs. Through its “Business Support Services”, DEG facilitates measures that further enhance the impact on development of co-financed investments, as well as pilot projects, innovative business models and feasibility studies.