The African Development Bank (AfDB) has today signed a USD 120 million Line of Credit (LOC) with Tanzania’s CRDB Bank Plc (“CRDB”) for onward lending to support Infrastructure development and SMEs in East Africa.
The LoC extended will spur regional trade and promote regional integration through expanding capacity of Tanzania’s port and airport, which will also stimulate tourism in the region.
Speaking at the signing ceremony, Mr. Gabriel Negatu, who was recently appointed the AfDB Director General, Eastern Africa Regional Development and Business Delivery Office (RDBDO), said poor infrastructure has been a major constraint for the region growth.
“Tanzania plays a key role in regional trade in terms of opening different countries to the world. This calls for faster development of its ports and airport to make East Africa more competitive in doing business,” Mr. Negatu said during the signing held at AfDB’s regional Headquarters in Nairobi.
Mr. Negatu added that the facility is also intended for onward lending to Small enterprises and women who have in the past been excluded from formal financial services. This is in line with AfDB’s Hi-5 Priorities and 10-Year Strategy of deepening the financial markets and promoting inclusive growth.
“The SME sector is also key to create more jobs and this project will support a wide range of SMEs across agriculture, construction, manufacturing, education and services in order to promote inclusive growth in the country,” Mr. Negatu added.
“By leveraging on our branch network and agents, this line of credit will also scale up our lending to SMEs and women enterprises in both urban and rural areas which will create more jobs and promote inclusive growth for Tanzania’s economy,” said CRDB Managing Director Dr. Charles Stephen Kimei.
CRDB, is Tanzania’s largest commercial bank with 120 branches in the country and footprint in Burundi. It supports various sectors including power, manufacturing, agriculture and SMEs.
In 2008, AfDB provided a risk-sharing facility to CRDB aimed at promoting SMEs in the agriculture sector, through which more than 270 SMEs have benefited. Since then, CRDB has expanded its SME loan portfolio and has partnered with more than 2,125 agents or non-banking intermediaries to widen its reach.