An amount of US$128.98 million has been put aside by the African Development Bank (AfDB) to support Africa’s small and medium enterprises (SMEs), according to reports from the Tunisian capital Tunis.
The amount, which is approved in terms of the AfDB’s Africa SME Programme, is part of a four-year plan consisting of US $125 million funding program combined with a US $3.98 million technical assistance package granted by the Fund for African Private Sector Assistance (FAPA), the Tunis-based Pan-African institution said in a statement.
The programme will provide standardised lines of credit (LoCs), mostly in local currency, and technical assistance to targeted financial institutions, predominantly in low-income countries spread over all five African regions, AfDB said.
The SME Programme will also avail important longer-term resources to thousands of SMEs including women and youth, thus contributing to job creation, poverty reduction and inclusive growth on the continent.
The SME sector is crucial to Africa’s growth, contributing more than 45% to employment and 33% to GDP, but continues to face various challenges, particularly funding and technical assistance.