Swedfund plans to increase investments in Africa

The Swedish Development Fund, also known as Swedfund, is looking to significantly scale up its funding to Africa in order to drive sustainable investments in green climate solutions through the private sector. Currently, Swedfund has dedicated a substantial amount of $300 million to Africa, but the organization aims to increase this investment to create a greater impact on the continent's development. CNBC Africa's Aby Agina had an exclusive interview with Maria Håkansson, the CEO of Swedfund, to discuss the organization's expansion plans and the impact of its investments. Swedfund, as the Swedish Development Finance Institution, focuses on sustainable investments that contribute to job creation and provide access to essential products and services such as electricity, healthcare, and digital solutions, emphasizing the importance of the private sector in driving economic growth. With over 40 years of experience investing in Africa, Swedfund has allocated more than 60% of its investments to the continent, concentrating on four key sectors: energy and climate, infrastructure, financial inclusion, and digital solutions, and food systems. The organization is particularly interested in investing in solutions for decarbonization, climate solutions with a digital component, and nature-based solutions. As macroeconomic uncertainty and geopolitical risks have increased in recent years, Swedfund has observed a growing funding gap that has affected many MSMEs. In response, the organization aims to enhance financial inclusion through both debt and equity investments. Additionally, Swedfund recognizes the potential of digital solutions in Africa, highlighting the region's talent and innovative business models that require support to become successful and sustainable ventures over time. The organization also seeks to invest in food systems across the value chain to boost productivity, address local value creation challenges, and improve logistics and cold chain infrastructure. Maria Håkansson revealed that Swedfund's annual investment volume is around $300 million, a figure that the organization plans to triple in the coming years as part of its growth strategy. Swedfund has been expanding its local presence in Africa by establishing regional offices in Nairobi and Abidjan to further support its investments and contribute to social impact. Håkansson emphasized that generating social impact is a crucial aspect of Swedfund's investments, noting that job creation and access to critical products and services are key drivers for the organization's investment decisions. Swedfund is committed to ensuring that its investments are sustainable and conducted in a responsible manner, contributing to the growth of local companies that meet international standards and fostering increased trade and capital mobilization. As an early and long-term investor, Swedfund plays a pivotal role in demonstrating the viability of sustainable investments to attract private sector capital. Despite the challenges faced by European countries in raising resources post-COVID, Swedfund has actually received increased capital injections from the Swedish government to facilitate its expansion and investment activities in Africa, reflecting a positive outlook for the organization's future endeavors.