DEG: new business reaches record high of EUR 1.9 billion

More commitments for investments in Africa

DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH, continued successfully on its path in 2018. It committed a new record level of EUR 1.9 billion for financing private investments in developing and emerging markets countries (2017: EUR 1.6 billion). DEG's commitments in 2018 enable entrepreneurial investments totalling EUR 9.8 billion to be made. The DEG portfolio grew to EUR 8.4 billion.

"Our business experienced dynamic growth last year. Development in Africa is particularly encouraging, with commitment of DEG's own funds reaching a new record high of EUR 438 million, to which EUR 14 million was added through promotional programmes. A further EUR 91 million was mobilised by partners", said Christiane Laibach, Spokeswoman of DEG's Management Board. In Africa, DEG is specifically committed to promoting entrepreneurial initiative and creating prospects for the young, growing population. "Our existing customers in Africa employ more than 550,000 people and generate local income of EUR 28 billion a year," stressed Laibach.

German business stable at high level

Financing for small and medium-sized enterprises, at EUR 967 million, was once again a focus in 2018. In this way, DEG helped to improve the inadequate supply of long-term financing for SMEs in many developing countries. German companies are also an important customer group. Overall new business stood at EUR 456 million, at the same high level as the previous year (EUR 465 million). In addition to loans and equity investments for German companies, this figure also includes financing for local companies acquiring German components, for example. In addition, funds were mobilised through third parties, such as German institutional investors.

DEG has further expanded its service for German companies and their local trading partners, the "German Desk – Financial Support and Solutions", which was initiated in 2017 with local partner banks and chambers of commerce abroad. In 2018 it opened a German Desk in Bangladesh, followed by one in Ghana on 11 February 2019. "The response has been encouraging at all locations. Around 60 financing arrangements have been realised so far," said Laibach.

DEG provided a total of EUR 641 million in 2018 for investments that promote climate and environmental protection. This included financing the largest solar park in the Caribbean, built with German expertise. From a regional viewpoint, Latin America accounted for the largest share of financing in 2018, at EUR 579 million. In terms of sectors, the financial sector and infrastructure were again in the lead.

New services for companies in developing countries

In addition to financing from its own funds, DEG offers advisory services and promotional programmes. It enables Business Support Services that boost the development impact of co-financed investments, for example, as well as feasibility studies and pilot projects. The measures co-financed in 2018 include a training initiative in conjunction with the German firm Knauf International GmbH, which is aiming to establish eight drywall training centres in six African countries. A new programme called “Africa Connect” is currently being developed. It will provide promotional funding of up to EUR 4 million for German SMEs.

DEG expects new business in 2019 to be at the level of the previous year. "This year, too, we intend to put further innovative ideas into practice. As examples, we want to offer more local currency financing, invest in digitalisation and specifically promote innovative business models", said DEG Chairwoman Christiane Laibach.