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PRESS RELEASE
November 30, 2023
IDRC Grants $900,000 to FINAFRIQUE for the Implementation of the Inclusive Bonds Project
The International Development Research Centre (IDRC), based in Ottawa, Canada, has awarded the FINAFRIQUE Consulting Firm, a grant worth $900,000 Canadian dollars for the implementation of the Inclusive Bonds Project in Cameroon and Côte d’Ivoire.
As a reminder, the Inclusive Bonds Project, which was initiated in 2020 by FINAFRIQUE, consists of a bond issue specifically designed to finance Very Small Enterprises and the Informal Sector. This program has the peculiarity of being oriented according to a number of sectors (Crafts, Agriculture, Transport, . . . ) but above all to be guaranteed by three stakeholders: the State (between 20% and 50%), International Financing Institutions (between 20% and 50%) and Informal Beneficiaries (up to 30%).
The main objective of this concept is to improve financing conditions for the most vulnerable entrepreneurial segment, namely Very Small Enterprises and the Informal Sector.
As part of this Concept, the State and the Financing Institutions, are responsible for selecting a credible Microfinance Structure which would play the role of issuer. It will be then the responsibility of this Microfinance, the « designated issuer », to select for a given sector, Groups/Cooperatives that have demonstrated good operational and financial governance, given that these Groups will proceed to the designation of Borrowers, among their members, as « designated beneficiaries » of this transaction.
This project has mobilized an important Working Group which includes International Institutions such as: UNDP, AFREXIMBANK, UNECA, Africa Guarantee Fund, PROPARCO, FAGACE, African Solidarity Fund, BRVM, BVMAC, as well as Public Administrations (MINFI, MINPME, MINCOMMERCE, …) of the two pilot countries that are Cameroon and Côte d’Ivoire.
The ongoing experimentation in Cameroon and Côte d’Ivoire is targeting two sectors, namely Craft Transformation (with “Made in Cameroon”, and “Made in Côte d’Ivoire” products), and especially Cross-Border Trade, which is one of the sectors prioritized by the AfCFTA and for which there is a lack of information and data due to the high level of informality that characterizes it.
In 2022, the Central and West African Stock Exchange Regulators, which are respectively COSUMAF and AMF-UEMOA (formerly CREPMF), announced their approval for the implementation of Pilot Operations. Thus, the Working Groups of Cameroon and Côte d’Ivoire are now working on an effective launch of Inclusive Bonds in the coming months.
In addition to the IDRC grant, the Inclusive Bonds project also received financial support from UNDP through its Africa Finance Sector Hub (AFSH) branch based in Pretoria.
Research@finafrique.com
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