MICROCAPITAL BRIEF: CDC Group of UK Investing $2.6b in Africa Over 2 Years; $387m Announced for MSMEs, Mid-caps, Renewable Energy, Technology

The CDC Group, a development finance institution owned by the UK government’s Department for International Development, has committed to investing GBP 2 billion (USD 2.6 billion) in African businesses over the next two years. This follows its recent announcement of the following new partnership agreements: USD 275 million for three banking institutions to invest in small and medium-sized enterprises (SMEs) as well as microenterprises; USD 67.5 million for three funds to invest in mid-caps and SMEs; and USD 45 million for two funds and one firm to deploy in renewable energy and other technologies.

The CEO of CDC, Nick O’Donohoe, said of the deal, “Investors have a real opportunity to embrace the UN’s Sustainable Development Goals – in partnership with African countries and businesses – to fight climate change, create jobs and skills and bring about positive social and environmental change. The commitments we have announced today will accelerate the roll-out of solar power and other renewable technologies and support the growth of countless SMEs – the bedrock of any healthy economy – across the continent.”

Established in 1948 as the Colonial Development Corporation, CDC later was renamed the Commonwealth Development Corporation before taking on its current official name, the CDC Group. The organization’s mission is to foster growth in “sustainable” businesses to raise living standards in developing countries. Since 2012, it has invested only in Africa and South Asia, using debt, direct equity investments and “fund-of-funds” strategies. As of 2019, CDC’s investment portfolio was valued at GBP 4.3 billion (USD 5.6 billion), and it reported total net assets of GBP 5.8 billion (USD 7.5 billion).

Sources and Additional Resources

CDC press release
https://www.cdcgroup.com/en/news-insight/news/cdc-group-to-invest-2-billion-in-african-businesses-over-the-next-two-years/

CDC homepage
https://www.cdcgroup.com/

CDC 2018 annual report
https://assets.cdcgroup.com/wp-content/uploads/2019/07/29142246/22218_CDC_Annual-Review_2018_190723.pdf

United Nations Sustainable Development Goals homepage
https://sustainabledevelopment.un.org/

MICROCAPITAL BRIEF: UK’s CDC Group Makes $16m Equity Investment as Part of $36m Package for Equitas
https://www.microcapital.org/microcapital-brief-uks-cdc-group-makes-16m-equity-investment-as-part-of-36m-package-for-equitas/

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