The French government is all set to support Africa in becoming one of the world’s biggest ground for investment and capital development. The country broke the news on Friday that it has entered into a widescale free trade area agreement with the African continent to boost the business opportunities in the region.
The French initiative branded as “Choose Africa” will comprise of a strategic combination of substantial support finance of 2.5 billion euros. The huge sum will be spread across credits and loan guarantees amounting to nearly 1.5 billion euros and direct investment billing to 1.0 billion euros. The reports suggested that the agreement shall come into force in 2020. The highly anticipated project will work for the flourishing of roughly 10,000 Africa-based firms. The initiative will be backed by the French development agency AFD along with its private sector financing platform, Proparco.
Djalal Khimdjee, the deputy CEO of Proparco, stated that they are striving hard to infuse more capital in the continent and increase the volume from 2.5 billion to nearly 3 billion euros. “All of the resources of AFD and Proparco will be mobilized in order to support African businesses at various stages of their development,” said the spearhead.
The honorable Finance Minister Bruno Le Maire, as well as Senegalese Finance Minister, Amadou Ba, gave an auspicious kickstart to the noble initiative. Le Maire stated that the “Choose Africa” initiative is the result of the pledge taken by French President Emmanuel Macron in November 2017, where he decided to support the development and growth of small and medium sized enterprises in the continent.
The leader quoted that “I am happy to launch this new phase of partnership” that is focused on catering to the demographic and environmental issues faced by the African continent in the future.
While talking about the shortcomings enveloping Africa and its business entities, Le Maire said that it “is the problem of financing. SMEs need stable, flexible, and solid financing. Choose Africa will provide access to the financing you need.”
Though the complete details about the initiative have not been revealed by either of the governments, the AFD website affirmed that it would provide the necessary assistance to potential start-ups in taking forward their revolutionary business ideas. The organization also aims to bridge the gap between SMEs and its private partners.
During the interaction, Ba quoted that in Africa, only one out of five SME and one start-up out of 10 have fair access to convenient bank credits. Though MSMEs form a major supporter of Africa’s economy, these entities fail to acquire the necessary credit required for their expansion. Le Maire opined that by 2050, these African entities should be in a position to create job opportunities for 450 million people.