AfDB sanctions €22mn to support SMEs, job creation in Senegal’s rural areas

The African Development Bank's Board of Directors have recently approved a line of credit of 22.5 million euros, including 15 million resources of the Bank and 7.5 million resources of Africa Growing Together Fund to support the National Bank for Economic Development of Senegal.

The small and medium-sized enterprises (SMEs) represent about 80 percent of the fabric of companies in Senegal and contribute 30 percent to the formation of GDP and employ nearly 60 percent of the active population. National Bank for Economic Development commenced its activities at the end of January 2014 to facilitate access to financing for SMEs and SMIs, and to provide global responses to their financial needs.

National Bank for Economic Development is a viable institution, which already posted in 2018, a net result of 3.3 million euros. The purpose of the requested credit line (LOC) is to finance a dozen small and medium-sized enterprises in the sectors of agriculture, fishing, poultry farming and agribusiness. National Bank for Economic Development requires long-term resources to finance agricultural-related activities through the provision of finance for transformation and industrialization as part of the agricultural value chain.

African Development Bank support will also provide support BNDE in capacity building for its agricultural credit officers, risk management, project management, environmental and social management systems, and results management of development.

This funding aims to create more than 1,000 direct jobs in rural areas, mainly for young people. It will also participate in promoting women's empowerment. With this in mind, the LOC will help unlock access to finance for the most vulnerable populations, thereby promoting the creation of local wealth and jobs, which are essential for reducing poverty and the out-migration of rural populations.

This project, in addition to the intervention of the African Development Bank (AfDB) and other donors in the agricultural value chain in Senegal, should help reduce food imports and contribute to achieving the development objectives of the emerging Senegal plan.

National Bank for Economic Development is a privileged partner for financing social programs in Senegal. It manages, on behalf of the State and donors, social programs aiming in particular to finance initiatives / projects of young people, women and the most disadvantaged social strata. BNDE implements inclusive financing programs with an overall budget of CFAF 4 billion in labor-intensive sectors.

The AfDB and Senegal have a long history of cooperation, dating back to 1972. Since that time, the Bank has financed 66 national projects in several sectors with a total investment of about 532 billion CFA Francs. Infrastructure projects account for 39.4 percent of the Bank's investment in this country, compared to 21.3 percent in the social sector and 18.7 percent in rural projects. In the private sector, the Bank has financed some four operations for USD 248 million.