The UK’s development finance institution, British International Investment (BII), has made strides to foster economic growth in Sierra Leone by establishing a $25 million risk-sharing agreement with Ecobank Sierra Leone. This collaborative initiative aims to stimulate private sector growth, particularly in sectors of the economy deemed high-impact, thereby addressing the crucial need for capital in a country where economic development has been hindered by inadequate investment. The agreement not only establishes a financial framework but also includes a technical assistance program designed to facilitate Ecobank’s capacity to increase lending to local businesses, emphasizing the role of the private sector in fostering sustainable economic growth.
In Sierra Leone, the private sector predominantly comprises small and medium-sized enterprises (SMEs), which are critical for employment, providing jobs to around 70% of the population. However, these businesses face significant challenges in accessing financing due to high collateral demands and a limited variety of financial products. The partnership between BII and Ecobank aims to address these challenges by enhancing local currency lending and injecting crucial capital into areas with high development potential. UK Minister for Development, Anneliese Dodds, has stressed the importance of this initiative for injecting working capital into these sectors to foster job creation and overall economic advancement.
Samir Abhyankar, the Managing Director and Head of Financial Services at BII, highlighted the strategic importance of the partnership with Ecobank Sierra Leone. He asserted that the agreement marks a transformative moment for the local banking landscape, allowing for greater financial flexibility and support for ambitious local entrepreneurs. By pioneering investments in underfunded regions, BII aims to catalyze broader economic activities and attract further investment into Sierra Leone. This agreement recognizes the pivotal role of capital availability in enabling SMEs to scale operations and sustain profitability.
The optimism surrounding this partnership extends to Sebastian Ashong-Katai, the Managing Director of Ecobank Sierra Leone. He expressed enthusiasm about the prospects of increasing Ecobank’s lending capabilities for local businesses. This collaboration aligns with the bank’s mission to position itself as a leading financial partner for enterprises in Sierra Leone, which can subsequently enhance the overall economic climate in the country. The agreement symbolizes a shared commitment to empowering local businesses through improved access to financial resources and tailored support mechanisms.
As part of its broader strategy, the investment falls within the framework of BII’s Africa Resilience Investment Accelerator. This initiative aims to facilitate investment flow into frontier markets, particularly in Africa, by creating significant investment opportunities and collaborating with local financial institutions to drive economic development. Building on past collaborations with the Dutch entrepreneurial development bank, FMO, the BII intends to use learnings from these partnerships to enhance investment efficacy in high-risk markets, indicating a commitment to long-term sustainable development.
In addition to supporting enterprises in Sierra Leone, the reach of Ecobank extends into the e-sports sector through collaborations such as the initiative with EStars in Nigeria. This partnership aims to promote e-sports education and equip students with essential life skills. Such efforts underline Ecobank’s diversified approach to community engagement and economic empowerment, enhancing the bank’s reputation as a critical player in promoting both financial inclusion and skill development across the African continent. This dual focus on finance and education reflects a holistic approach to fostering economic growth that is sustainable and inclusive, making strides in both the financial and educational landscapes of the region.
