- EIB has committed EUR 95 million to support companies that were most affected by the COVID-19 pandemic in Rwanda
- Bank of Kigali and KCB Bank Rwanda have been picked to manage the funds
The European Investment Bank has announced that it will support companies that were most affected by the COVID-19 pandemic in Rwanda, to a tune of EUR 95 million.
In a statement, the bank said it had picked Bank of Kigali (BK) and KCB Bank Rwanda to manage the funds, as well as provide new credit lines for Rwandan companies.
Commenting on the development, the Minister of Finance and Economic Planning Uzziel Ndagijimana welcomed EIB’s latest private sector engagement in Rwanda and the launch of its EUR 175 million East Africa COVID-19 Response Facility in the country.
Rwanda becomes the first country in East Africa to benefit from the new streamlined financing programme that will provide long term financing in both Rwandan Francs and US Dollars.
The minister said the pandemic has disrupted Rwandan businesses which has led to a negative economic impact on the country.
He added that the European Investment Bank partnership with Bank of Kigali and KCB-Rwanda will ensure that businesses can continue to invest and more specifically, targeted support will also improve access to financing by companies that contribute to the economic empowerment of women and girls.
“I congratulate all those who have enabled Rwanda to be the first country to benefit from the EIB’s East Africa COVID-19 Response Facility. I also commend EIB’s support in the context of COVID-19 response through the support to National Health Referral Laboratory Project which will complement other investments that Government and European Investment Bank are jointly making in the sectors of Energy, Water and Sanitation” he said.
At the same time, Diane Karusisi, Bank of Kigali Chief Executive Officer said the funds provided will enable the bank’s clients to stay afloat and continue progressing steadily even after the COVID-19 crisis.
“This facility clearly compliments the Government of Rwanda and Bank of Kigali’s efforts to stimulate the country’s economic recovery,” she said.
KCB Bank Rwanda Managing Director George Odhiambo said the bank believes in enabling local businesses with multiple financing options, targeted to various sector growth initiatives.
He added that over the past 2 years, the bank had seen several companies and households overly affected by COVID-19.
“Therefore, this is a timely convergence of funds that will ultimately seek to benefit women entrepreneurs, many of whom are the backbone of our society”, he added.
In addition, as part of COVID-19 response, EIB signed a project agreement with Rwanda Biomedical Centre (RBC) to complete the last milestone of the financing contract worth EUR 22 million signed between EIB and the government of Rwanda, through the Ministry of Finance and Economic Planning for National Health Referral Laboratory Project.
The Project will further be co-funded by European Union which will contribute EUR 5.1 million, with the World Health Organization as one of implementing partners.
Speaking on the funding, Dr Daniel Ngamije Minister for Health said unlocking new investment by the Rwanda Biomedical Centre will transform diagnosis, surveillance and research at the National Health Laboratory.
“The EUR 27 million Team Europe support provided by the European Investment Bank’s streamlined African COVID-19 health resilience engagement and the European Union will better protect Rwandans from disease and future epidemics,” he said.
European Investment Bank Vice President Thomas Östros said that since the COVID-19 outbreak, the bank had been working with leading banks and financial institutions across Africa to ensure that companies can continue to invest, protect jobs and harness new business opportunities.
“The EUR 95 million leveraged by EIB’s financing for the Bank of Kigali and KCB Bank Rwanda agreed today will help strengthen economic resilience in Rwanda and includes targeted financing for female entrepreneurs and firms that accelerate the economic empowerment of women,” he said.
The financing agreements reached with the Bank of Kigali and KCB Bank Rwanda will enable entrepreneurs and businesses across Rwanda to access a total of EUR 95 million of new financing available under the EIB East Africa COVID-19 Rapid Response Facility.
Under this arrangement, the Bank of Kigali will receive EUR 40 Million, and contribute a matching EUR 40 Million to the program. KCB will receive EUR 15 Million bringing the total EIB-backed financing to EUR 95 Million. The streamlined financing programme will contribute to job creation and support firms in sectors most impacted by COVID-19 challenges.
Female-led companies and firms that contribute to gender quality will benefit from improved access to finance up to 30% of the total financing under the two new credit lines.