International Finance Corporation (IFC), a member of the World Bank Group, launched a new fund that will focus on investing in small and medium enterprises in central Africa.
The Central Africa Small and Medium Enterprise (SME) Fund, which is aimed at helping to improve access to finance, create employment, and reduce poverty in some of Africa’s least developed countries, will be managed by XSML, a social investment fund manager based in the Netherlands, and Cenainvest, a SME fund manager based in Cameroon.
The new vehicle will make equity and equity-related investments in smaller businesses across the central African region.
IFC is investing $12.5m in the fund that will initially focus on companies in the Central African Republic, which will also receive advice on implementing better corporate governance, raising environmental and social performance, and other business support.
With IFC’s support, XSML and Cenainvest will aim to mobilize a total of $25m from other development finance institutions and the private sector.