The signing ceremony took place at MINECOFIN on Tuesday.
The Development Bank of Rwanda (BRD) has received €15million that will enable the bank to offer long-term loans to various private sector businesses as a way of pushing the country’s COVID19 recovery process.
The financing from the European Investment Bank (EIB) was this November 23, 2021, penned down in Kigali in a financing deal signed between Uzziel Ndagijimana, Rwanda’s Minister of Finance, EIB Vice President Thomas Ostros, and the BRD Chief Executive Officer, Kampeta Sayinzoga.
The fund is part of EIB’s East Africa COVID-19 Rapid Response facility and also BRD’s own capital.
The funding is expected to enable the country to recover from Covid-19 pandemic a process in which the government has targeted to solicit over $300million in order to return the economy back on track.
“COVID-19 pandemic has hit Rwandan companies hard and new investment is essential to overcome health, business, and trade challenges. The European Investment Bank’s partnership with the Development Bank of Rwanda will unlock essential new investment. I wish to thank the EIB for their firm support to private sector growth, water, and medical investment in our country,” said Dr. Ndagijimana.
CEO Kampeta Sayinzoga said that the financing illustrates growing trust that international financial institutions have for Rwanda but also will increase the bank’s capitalization, offering long-term financing loans and facilitating private sector development, especially small and medium enterprises.
“More specifically, this investment will enable BRD to provide long-term loans to companies ready to invest directly in Rwanda’s recovery journey. Together, we will capitalize on job creation and value addition,” Sayinzoga said.
The funds will go mainly towards women and youth-led business
BRD said that the new financing scheme will include support companies in all sectors most impacted by the trade, economic, and health challenges triggered by COVID-19 and unlock investment to accelerate private sector recovery from the pandemic.
The financing also has good news as it provides Rwandan companies with access to long-term loans in Rwandan francs, US dollars, and Euros- with tenors of up to 10 years, far longer than usually available.
EIB Vice President, Thomas Ostros, who is in his first visit to Africa and is spending a week in East Africa meeting political, business, and financial leaders ahead of launching the EIB’s new regional hub for East Africa, said that he choose to step in Rwanda first because it has a good track record of managing EIB finances.
The BRD-EIB financing deal follows one last month, where Rwanda was the first country in East Africa to benefit from the EIB’s streamlined €175 million East Africa COVID-19 Response Facility Programme when €95 million of new financing to be managed by Bank of Kigali Plc and KCB Bank Rwanda was unveiled.
The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for a sound investment to contribute towards EU policy goals.
The Development Bank of Rwanda (BRD) Plc has since 1967 been the leading provider of long-term investment loans to projects in priority sectors of the Rwandan economy including Digital Economy, Exports& Manufacturing, Education, Renewable Energy, Affordable Housing, and Special Projects.
