Equity Group has launched a private sector focused stimulus package to accelerate economic recovery and resilience in the Eastern and Central Africa region as it recovers from the devastating health, social, humanitarian, and economic impacts of the COVID-19 pandemic.
Equity’s Eastern and Central Africa Recovery and Resilience plan is envisaged to provide financing of up-to 2% of the combined GDP of the six economies, in which the Group operates, to the private sector in the form of blended financing of short-term overdrafts, medium term loans and credit facilities which require long-term project and development financing.
While launching the Recovery and Resilience Plan, Dr. James Mwangi, Equity Group Managing Director and CEO said, “A total of Kshs 678 billion (USD 6 billion) will be available to 5 million MSMEs and 25 million individual borrowers for the next 5 years. The plan conceives that the 5 million businesses largely comprising MSMEs will create 50 million jobs, 25 million jobs directly and an equal number of jobs indirectly as the ecosystems of business become more cohesive, connected, and ultimately synergize and grow.”
“The recovery plan will have special focus on youth and women, supporting them to be the primary drivers of creating and expanding opportunities in the real economy. Under the Young Africa Works Initiative in partnership and collaboration with the Mastercard Foundation, the plan will build capacity in young people through financial literacy, entrepreneurship training and digital literacy”. Dr. Mwangi said.
He added, “To ensure that no one will be left behind, lending to young people will be complemented with credit guarantee facilities to mitigate default through our credit risk pricing model that has opened inclusive credit access to all. Risk based credit pricing has enabled us to adopt a transparent, all-inclusive interest rate, at the current average central bank rate that ranges from 13% to 18.5% for the lowest risk and the highest risk categories respectively,”
The Regional Development Plan through recovery and resilience initiatives focuses on five thematic areas namely, Primary sectors of Food and Agriculture, and extractive sectors, manufacturing and Logistics, Trade and Investments, Micro small and medium enterprises and Social impact and Environmental investments