Three major European development finance institutions (DFIs) - PROPARCO, FMO and DEG - have signed a 12-year loan facility of $189m with the Aga Khan Fund for Economic Development (AKFED) to support economic and social development in Africa, the Middle East and South and Central Asia.

The loan will contribute towards the support of economic and social development in these regions through the funding of projects in sectors such as finance, infrastructure, industry, tourism, and aviation, thereby increasing revenues, employment, and access to essential services for the peoples of these areas and thus improving their quality of life.

“AKFED’s collaboration with these financial institutions over many years has already resulted in a number of pioneering projects in developing countries, thereby creating major benefits for the local population and economies,” said Mahmud Janmohamed, member of AKFED’s Executive Committee.

“This facility will further strengthen our partnership and will help us to achieve even more of our joint objectives in reducing poverty, building capacity and setting benchmarks for new long-term investments in Asia and Africa,” he added.

AKFED is one of the agencies of the Aga Khan Development Network (AKDN) and is dedicated to promoting entrepreneurship and to building economically sound enterprises in the developing world.

It operates a network of affiliates with more than 90 project companies in 17 countries, making bold but calculated investments in situations that are fragile and complex, such as in Afghanistan where it assists in the reconstruction and post-war context.

Over the years, AKFED has proven its capacity to sustain and support critical industries such as aviation in Africa and tourism, whilst building up essential industries such as infrastructure, telecommunications, energy, agribusiness and banking.

Through its action, AKFED has consistently demonstrated the vital role the private sector must play in development – a principle to which the three development finance institutions are also committed.

“This operation is the outcome of a long-term collaboration between the three DFIs and AKFED. We have been working together for more than 15 years financing various tourism, industry and infrastructure projects sponsored by AKFED. Through this financing, we are very pleased to further develop our partnership to support development in the South”, said Marie-Hélène Loison, Deputy CEO at PROPARCO.