European DFIs, through the Association of European Development Finance Institutions (EDFI), set up EDFI Management Company (EDFI MC) in 2016 to develop and manage joint financing facilities in partnership with the EU institutions. This first-of-a-kind joint financing platform allows European DFIs to cooperate efficiently and to achieve high impact, in an example of what is now often referred to as a Team Europe approach.
EDFI MC recently celebrated its fifth anniversary, and it already plays a role in delivering a range of innovative financing solutions supporting private sector development. Examples include the EU-funded AgriFI and ElectriFI facilities targeting investments in early-stage enterprises in the agriculture and energy sectors, and the COVID-19 window under the European Financing Partners (EFP) facility in partnership with the European Investment Bank (EIB). EDFI MC was recently accredited to manage budgetary guarantees under the EU’s European Fund for Sustainable Development (EFSD), in recognition of the business practices and expertise that it has built up since its launch. This milestone is reached after many years of co-investment activity among European DFIs, launching the first EFP facility in partnership with EIB in 2004, followed by the Interact Climate Change Facility (ICCF) in 2011 together with the EIB and AFD. Over €1 billion of investments have so far been made in impactful projects under EFP and ICCF.
Earlier this month, European DFIs took a further step to reinforce their involvement in the ownership and governance of EDFI MC, which is now owned directly by nine European DFIs and the EDFI Association in equal shares. During its incubation period, EDFI MC was 99%-owned by the EDFI non-profit association. The new structure allows the European DFIs to continue to develop joint financing facilities in areas of common interest. This is particularly relevant in view of the significant emphasis on expanding initiatives to promote private sector development in the EU’s recently adopted multi-annual financial framework for the 2021-27.
“European DFIs cooperate closely on innovative financing solutions to support private sector development in areas such as climate finance and the inclusive response to COVID-19. EDFI’s important partnership with the EU institutions and the joint facilities supported by EDFI MC play an important role in these efforts. The recent steps to strengthen EDFI MC’s structure will enable us to pursue new strategic initiatives in the coming years.”
Søren Peter Andreasen, General Manager of EDFI, the Association of European Development Finance Institutions, and Chair of EDFI MC’s Board of Directors.
“As part of EDFI MC we look forward to strengthening our cooperation and further promote impact investing, which will improve the private sector and the livelihood of people in developing countries. Following the pandemic there is a strong need for joining efforts to enable developing countries to build back better and greener, and we are pleased to support this work alongside our DFI colleagues,” said Torben Huss, CEO of IFU.
“The strong involvement of the European DFIs in EDFI MC and the EU’s accreditation for managing budgetary guarantees will allow us to continue to develop further the exciting mandates entrusted to us. We are thankful for this engagement and recognition, which is also a great motivation for our staff,” concluded Frederik van den Bosch, CEO of EDFI MC.
About EDFI MC activities
EDFI MC manages two EU-funded market development facilities EDFI AgriFI – The Agriculture Financing Initiative and EDFI ElectriFI – The Electrification Financing Initiative, in partnership with FMO. It also administrates two co-financing facilities among European DFIs, the European Investment Bank (EIB) and Agence Francaise de Developpement (AFD): the European Financing Partners and the Interact Climate Change Facility. In addition, the EDFI MC plans to launch risk-sharing facilities, such as the T&C guarantee to tackle transferability and convertibility issues (in partnership with Proparco) and new guarantee facilities under the European Fund for Sustainable Development (EFSD+).
About EDFI MC ownership structure
As of May 2021, EDFI MC is owned directly by nine European DFIs (BIO – Belgium, Cofides – Spain, DEG – Germany, Finnfund – Finland, FMO – Netherlands, IFU – Denmark, OeEB – Autria, Proparco – France, Swedfund – Sweden) and the EDFI Association in equal shares.
EDFI, the Association of European Development Finance Institutions (EDFI) promotes the work of 15 bilateral development finance institutions that invest in the private sector in emerging and frontier markets to create jobs, boost growth and fight poverty and climate change. Since EDFI was set up in 1992, its members have invested in approximately 15,000 projects, and they now manage a combined investment portfolio of EUR45 billion across financial services, clean energy, industry and many other sectors in more than 100 countries. For more information, visit www.edfi.eu