Kuwait Fund For Arab Economic Development : Signing of a Loan Agreement for financing The National Fund for Inclusive Finance (FNFI) Program of Operation Project in Republic of Togo

On the occasion of the 4 Africa-Arab Summit' in Malabo, Equatorial Guinea on 21 - 24 November 2016, a Loan Agreement and the related Project Agreement were signed between the Government of the Republic of Togo and Kuwait Fund for Arab Economic Development, in the gracious presence of His Highness Sheikh Sabah Al-Ahmed Al-Jaber Al-Sabah, the Amir of the State of Kuwait, whereby the Fund will make a loan in the amount of four million Kuwaiti Dinars (K.D. 4,000,000/-), equivalent to about U.S.$ 13.6 million, to the Republic of Togo, to assist in the financing of the National Fund For Inclusive Finance (FNFI) Program of Operation Project. It is worth mentioning that the Fund depends exclusively on its own resources in providing its loans and development assistance.

The Loan was made in pursuance of an initiative by His Highness Sheikh Sabah Al-Ahmed Al-Jaber Al-Sabah, the Amir of the State of Kuwait announced at the 3 Africa-Arab Summit held in Kuwait during the period 19 - 20 November 2013 to grant concessionary loans to African countries to the tune of one (1) Billion US Dollars spread over the succeeding five years for financing development projects in the African countries.

The Loan Agreement and the Project Agreement were signed on behalf of the Republic of Togo by His Excellency Kossi Assimaidou, Minister of Development and Planning and on behalf of Kuwait Fund for Arab Economic Development by Mr. Abdul-Wahab Al-Bader, Director-General of Kuwait Fund. Mr. Ayad Al-Gharaballi, Regional Manager for Central, East and South African Countries of Kuwait Fund attended the signing Ceremony.

The Project aims at promoting micro project, which contribute to social and economic development in the Republic of Togo, through the provision of financing by National Fund for Inclusive Finance (FNFI) to microfinance institutions to support their operations improvising micro credit. The Project consists of the programmer of operations of FNFI for the years 2014-2018.

The Project includes the following components:

1. Provision of line of credit for microfinance institutions to promote access to finance services for small farmers, youth activities and the vulnerable throughout the years 2017-2018.

1. Institutional support and capacity building for FNFI and microfinance institutions, including training workshops for awareness raising, provision of telecommunication and office equipment.

The Project is expected to be completed by the end of 2018.

The total cost of the project is about US$ 54 million, the government contributes about 24 million US Dollars and the financial institutions contribute about US$ 30 million; the Kuwait Fund contributes 4 million Kuwaiti Dinars, or about 13.6 million US Dollars, noting that the proposed loan will cover the costs of the project in local currency.

The loan shall be for a period of 26 years including 5 years grace period. The loan bears interest at 1% per annum, in addition to 0.5% per annum to cover administrative and other expenses incurred in the implementation of the Loan Agreement.

By signing this loan agreement, it will be the 8 Loan that the Fund provided to Togo, where the Fund previously provided seven loans to finance projects in various sectors amounting to about KD 24 million. In addition, the Fund has also provided Togo with two Technical Assistance of about 183,000 Kuwaiti Dinars to finance the preparation of the technical and economic feasibility studies of two projects. The Fund also has extended two Grants to Togo totaling of about 183,000 Kuwaiti Dinars. Moreover, the Fund has administered a State of Kuwait Grant within the framework of Goodwill Fund initiative in the amount of 874,000 Kuwaiti Dinars.