In 2018, IFU entered into investment agreements at a total of DKK 1.5bn, which is an all-time high investment level. More than one third, corresponding to DKK 542m, was invested in Africa, while the remaining investments were made in Asia, Latin America and in Ukraine.
– I am very pleased with this year’s investments and the investment level. It is in accordance with our strategy to increase our impact in the investment countries by boosting investments continuously, and the goal is to reach an annual investment level of two billion in 2021, said Torben Huss, CEO of IFU.
Jobs for more than 200,000 people
The largest single investment of the year was in Nordic Microfinance Initiative, in which IFU made an additional investment of DKK 184m. IFU’s total investment in microfinance is now at DKK 550m, and it contributes to supplying more than 18 million clients with microloans used to develop their businesses and improve their livelihood. 15 million of the clients are women.
At year-end, IFU had an active portfolio of 203 projects, which employed more than 200,000 people in total, including more than 90,000 in Asia and close to 70,000 in Africa. Furthermore, the portfolio projects reported corporate taxes of DKK 2.9bn, of which more than half was in Africa.
The Danish SDG Investment Fund in place
At the end of 2018, IFU completed the fundraising for the Danish SDG Investment Fund, which will support the realisation of the UN Sustainable Development Goals through commercial private sector investments in developing countries, including strategic sectors such as energy, agribusiness, infrastructure and the financial sector.
The total capital commitment to the Danish SDG Investment Fund is nearly DKK 5bn, which makes it the largest public-private fund yet to be established by IFU. DKK 2.9bn, corresponding to 60 per cent of the fund’s total capital commitment, comes from ten institutional and private investors, including PKA, PensionDanmark, PFA, ATP, JØP/DIP and Pensam.
Investments to create impact and profit
In general, IFU’s investments create a positive impact in the investment countries as well as a yield to the investors. However, in 2018, IFU recorded a loss of DKK 161m.
– Over time, IFU has been good at generating profit from our investments, however, in 2018, we experienced a negative result. This is not satisfactory, but is primarily due to negative contributions from a few larger share capital investments. Our loan portfolio continued to contribute positively to the annual result, said Torben Huss.