In the context of the health crisis, Proparco (AFD Group) supports the action of the Financial Center for Entrepreneurs (CFE) in favor of VSEs and SMEs by granting an ARIZ guarantee of 5 million euros as part of the Choose Africa initiative resilience. This guarantee will facilitate access to financing for underserved VSEs and SMEs, mainly in the following sectors: tourism and catering, crafts and manufacturing, education, health, agriculture, retail trade, and local services.
Proparco has been supporting CFE Tunisie since 2016. The new Choose Africa Resilience guarantee will provide CFE Tunisie with a risk-sharing instrument as part of the growth of its portfolio of loans to VSMEs, in a context of health crisis. These loans are intended to strengthen the capacities of micro entrepreneurs to overcome the crisis.
CFE Tunisia’s clientele is made up of very small entrepreneurs who are looking for microloans repayable in the short and medium term and micro-entrepreneurs who need higher loan amounts to support more substantial investments. This microfinance institution offers a range of loans ranging from 3,000 to
40,000 dinars (i.e. between €900 and €12,000) and supports project leaders in all areas of activity: from transport to retail, from manufacturing to catering, including education, crafts, farming, etc
As a player in the social and solidarity economy, and through its mission of financial inclusion, CFE Tunisie has a significant impact on improving the living conditions of its customers and the development of their activities. By supporting micro-entrepreneurs in their projects, CFE Tunisia has made it possible to maintain or create up to 28,000 jobs since its creation in 2015 (Impact study of a sample of customers).
This Choose Africa Resilience guarantee will contribute to SDG 1 (“increased income in urban and rural areas”), SDG 8 (“decent work and economic growth”), and SDG 10 (“reduced inequalities”).
“Proparco is very pleased to strengthen its partnership with CFE Tunisie through the granting of a Choose Africa Resilience guarantee. The impact of CFE Tunisie with micro-entrepreneurs, in particular women and young people, makes it a key partner in Tunisia committed to supporting VSEs/SMEs affected by the COVID-19 crisis,” said Amina Ben Abdelkarim. , Representative of Proparco in Tunisia.
“The Choose Africa Resilience guarantee, offered thanks to the support of the French government and deployed by Proparco, will enable CFE Tunisia to provide a response adapted to the needs of Tunisian entrepreneurs affected by the health crisis. This partnership is a new illustration of France’s commitment to development, reiterated by the President of the Republic Emmanuel Macron during the New Africa-France Summit. Since 2018, more than 2.7 billion euros have been committed by Proparco and AFD as part of the French Choose Africa initiative,” said HE André Parant, Ambassador of France to Tunisia.
Mr Radhi Meddeb, Chairman of the Board of Directors of CFE declared that “We are proud to sign this partnership with the guarantee fund. This will allow the CFE to engage more with micro, small and medium-sized enterprises and foster their greater inclusion and better access to credit”
Mr. Kamel Saibi, the Director General of the CFE added “this agreement will above all serve the activity of micro-entrepreneurs put to the test by the Coronavirus pandemic and weakened by their difficulty in accessing financing, particularly for women entrepreneurs and young people »
Choose Africa Resilience
The economic consequences of the Covid-19 crisis have a strong impact on VSEs and SMEs in Africa, they accentuate the problems of access to financing that they encountered long before the crisis.
Despite the deterioration of the macroeconomic context, Proparco has stepped up its action to support the African private sector. Since March 2020, Proparco has offered its existing clients flexibility solutions (delays in maturities, provision of additional financing, etc.) to meet their most urgent needs.
As a continuation of this immediate response and in conjunction with its development bank counterparts, AFD Group is strengthening its intervention capacity for the benefit of private companies and financial institutions in Africa. Proparco is thus expanding the Choose Africa initiative with a new component, Resilience, with an additional budget of €1 billion. This system includes tools for loans, guarantees, equity investments and support, adapted to the context of the crisis.