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Women Entrepreneurs Finance Initiative Invests In Over 15,000 Women-Led Businesses

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The Women Entrepreneurs Finance Initiative (We-Fi) announced today its third funding allocation comprising $49.3 Million – expected to benefit over 15,000 women-led businesses and mobilize about $350 million of additional public and private sector resources.

We-Fi’s latest round of allocations addresses the needs of women entrepreneurs created by the COVID-19 crisis, and encourages innovation and digital development, partnership development and the use of results-based mechanisms to facilitate greater access to financing for women entrepreneurs.

The third round allocates funding for programs to boost women’s entrepreneurship that will be implemented by four multilateral development banks; the European Bank for Reconstruction and Development for programs in Central Asia and the North Africa region, the Inter-American Development Bank for projects in Latin America, the Islamic Development Bank for entrepreneurship activities in fragile contexts in West Africa, and the World Bank Group for projects in the Sahel region, MENA and global programs. Over 65 percent of the most recent allocations will benefit women entrepreneurs in low-income (IDA-eligible) countries and countries affected by fragility and conflict. As a result of three financing rounds which now total almost $300 million in allocations, programs backing women-led businesses will soon expand to 61 countries.

Due to the COVID-19 crisis, women entrepreneurs around the world are suffering large setbacks. New data about the disproportionate effects of lockdown measures on women-led SMEs are emerging; in several Sub-Saharan countries, about 60% of women-led small businesses have lost their sources of income, three times more than men-led businesses. Globally, women-owned SMEs are about 6 percentage points more likely to close their business than male-owned businesses, according to recent World Bank-led research.

“As we absorb the consequences of the COVID-19 pandemic around the world, we need to take strong actions to build back better. Many women-led SMEs are disproportionally affected by the economic disruptions of the COVID crisis and many more women are losing their jobs. Entrepreneurship is central to the economic empowerment of women, especially in developing economies. Actions and support, such as by We-Fi’s recent round of financing, reaches women entrepreneurs in this time of need, and will help reestablish their roles as engines of inclusive economic growth”, says Mari Pangestu, Managing Director of Development Policy and Partnerships of the World Bank, which hosts the We-Fi Secretariat.

“We-Fi’s third round of allocations could not have come at a more important time. I am very pleased to see our Implementing Partners preparing such strong proposals to support women-led SMEs. Projects to leverage digital technologies, support digital skills-building, and identify new business opportunities that may arise as a result of the pandemic will benefit so many women-led SMEs during this crucial time”, says Mathew Haarsager, Deputy Assistant Secretary for International Development Finance and Policy of the U.S. Department of the Treasury and chair of We-Fi’s Governing Committee.

Under the third round of funding:

The European Bank for Reconstruction and Development (EBRD) was granted $7.36 million for its “Stepping Up for Women” Program which aims to rapidly respond to the disproportionate pressures WSMEs face in the context of the ongoing COVID-19 related crisis. The program will deploy innovative solutions for WSMEs that will contribute to (a) improving access to markets through more inclusive supply chains; (b) enhancing competitiveness, growth potential, and access to finance by strengthening their ability to leverage digital technologies and (c) leveraging sex-disaggregated data to inform more effective public and private sector interventions. Program activities will be implemented in Kyrgyz Republic, Mongolia, Tajikistan, Uzbekistan, Egypt, and Morocco.

The Inter-American Development Bank (IDB) received $14.71 million for its program to support access to finance, markets, skills and networks for women-led businesses primarily in technology and science-supported sectors. The program will prioritize helping women entrepreneurs navigate the ongoing economic crisis, and also to identify new business opportunities that may arise as a result of the pandemic. The program will provide acceleration support as well as seed and venture capital to high-potential STEM women entrepreneurs.  The program focuses on countries in Central America, Ecuador and Guyana.

The Islamic Development Bank (IsDB) received $11.25 million for its program which supports women in West Africa engaging in entrepreneurial activities in the rice value chain. While women are heavily engaged in the rice industry, the prohibitively high cost of borrowing, and the non-financial constraints which hinder access to resources, assets, and markets, prevent women entrepreneurs from improving their livelihoods.  Accordingly, the program will aim to support upgrading and advancing women-owned SMEs within the rice value chain in West Africa though capacity development and grant matching, as well as increased access local and regional markets. Activities for this program will be carried out in Guinea, Niger, Senegal and Sierra Leone.

The World Bank Group (World Bank and IFC) received $16.01 million for a digitally enabled access to finance and markets program for women-led business in the Sahel region and globally, and an early-stage finance program supporting women entrepreneurs in several regions. The first program will foster market linkages between suppliers and buyers across the Sahel. It will provide services and training to women-led shea butter cooperatives on know-how, managerial capacity, networks, and marketing tools as well as support the digitization of payment systems. The second program seeks to create an inclusive entrepreneurial ecosystem, addresses financing gaps, and assists with skills-building and mentoring of women entrepreneurs. Activities for these programs will be implemented in Burkina Faso, Mali, Mauritania, Jordan, Iraq, and globally.

About We-Fi:

The Women Entrepreneurs Finance Initiative (We-Fi) is a multilateral partnership supporting women entrepreneurs with access to finance, markets, technology, mentoring, and other services, while working with governments and the private sector to improve the laws and policies inhibiting women’s businesses in developing countries.

We-Fi is supported by the governments of Australia, Canada, China, Denmark, Germany, Japan, the Netherlands, Norway, the Russian Federation, the Kingdom of Saudi Arabia, the Republic of South Korea, the United Arab Emirates, the United Kingdom, and the United States. The We-Fi secretariat is housed by the World Bank and its programs are implemented by six Multilateral Development Banks.

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Development

Digital Technologies Can Help Maldives Build Back Better From the COVID-19 Shock

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Maldives can leverage digital technologies to build back better for a more green, resilient, and inclusive development following the COVID-19 pandemic, says the latest World Bank Maldives Development Update: A Digital Dawn released today.

The Maldives Development Update (MDU) notes that the country, post a massive pandemic led downturn, is firmly on the road to recovery. Thanks to successful marketing campaigns and relatively straightforward entry requirements, Maldives received more than 300,000 tourists in the first quarter of 2021. Assuming that a million tourists visit the country this year, the World Bank forecasts real GDP to grow by 17.1 percent in 2021. There are both downside and upside risks to the forecast.

The Update analyzes the devastating effect of the pandemic on the island nation’s economy. From end-March to mid-July 2020, the country was forced to close its borders to tourists, bringing the economy to a standstill. Tourist arrivals plummeted nearly 70 percent, leading real GDP growth to contract by nearly 30 percent compared to 2019. The government took steps to protect the lives and livelihoods of Maldivians, and yet the pandemic is expected to have led to a temporary increase in poverty.

“The Government of Maldives has shown the world that a safe reopening to tourism is possible,” said Faris. H. Hadad-Zervos, the World Bank Country Director for Maldives, Nepal and Sri Lanka. “With active management of the current macro-fiscal situation, Maldives’ medium-term growth prospects can continue to be positive given its strong reputation as a luxury destination and ongoing investments in tourist infrastructure.”

As Maldives builds back better from the COVID-19 crisis, addressing fiscal and debt vulnerabilities will be important. In 2020, the fiscal deficit reached nearly USD 900 million or 20 percent of estimated 2020 GDP. Total public and publicly guaranteed debt reached USD 5.6 billion or nearly 140 percent of estimated 2020 GDP. Although the recovery is now underway, Maldives’ fiscal deficit and debt ratio are expected to remain elevated over the medium term.

The pandemic has led to a spike in debt vulnerabilities across the globe, and Maldives is no exception,” said Fernando Im and Pui Shen Yoong, lead authors of the MDU. “Addressing these vulnerabilities would help Maldives build resilience to cope with unexpected future shocks”.

The special focus section of the MDU sheds light on how digital technologies can be game changers for Maldives’ growth and development. The COVID-19 pandemic has accelerated the digital transformation that was already underway, thanks to relatively high broadband and mobile internet penetration in the country. About 63 percent of the population used the Internet in 2019, a higher proportion than in other South Asian countries and peers outside the region. There is tremendous potential to use digital technologies to improve the delivery of services such as health, education, and disaster risk management, especially to outer atolls.

To leverage the digital dividend, Maldives needs to address policy, legal and regulatory gaps that currently inhibit the adoption of digital technologies. It also needs to boost Maldivians’ digital capabilities and skills to ensure that all Maldivians can take advantage of new technologies in an increasingly digital world.

“Wider use of digital technologies can help the government improve service delivery and allow smaller businesses and informal workers to expand access to markets,” said Junko Narimatsu, lead author of the special focus section. “However, for digital development to play a more prominent role in Maldives’ economic recovery, it is essential to close the digital divide between Male’ and the atolls.”

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ADB, Habitat for Humanity to Support Housing Microloans for Vulnerable Communities

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The Asian Development Bank (ADB) has teamed with Habitat for Humanity International to help microfinance institutions (MFIs) deliver housing loans to low-income families in rural and peri-urban areas of Bangladesh, India, Indonesia, and the Philippines.

The collaboration will expand ADB’s Microfinance Risk Participation and Guarantee Program to include microloans for housing, home improvement, and water and sanitation for vulnerable and climate change-exposed communities. ADB will help MFIs obtain financing for these purposes from commercial banks of up to $30 million in the first phase. Habitat for Humanity will build the MFIs’ capacity to design, pilot-test, and roll out the loans, with technical assistance from ADB.

“Low-income families find it difficult to build resilient houses as they lack adequate and affordable financing options due to the collateral requirements of commercial banks,” said ADB Private Sector Financial Institutions Division Director Christine Engstrom. “MFIs have the networks to reach these communities, but often lack the technical capacities to deliver housing microloans to them. Building on Habitat for Humanity’s technical and training expertise, this inaugural partnership will enable ADB’s Microfinance Program to better address this market gap.”

“The demand for urban housing in Asia remains largely unmet, giving the private sector a critical opportunity to deliver affordable materials, construction quality, access to energy, gender equity, water supply, and sanitation services, while supporting greater gender equity,” said Habitat for Humanity International Chief Operating Officer Patrick Canagasingham. “With ADB, we will create enabling environments for MFIs through risk-sharing and capacity building, helping unlock local private sector capital for housing.”

“This partnership is timely, as micro-housing for the poor and investing in community resilience are key drivers of economic recovery from the pandemic,” said Lead of ADB’s Microfinance Program Anshukant Taneja.

An expected 20,000 households will receive housing microloans from partner MFIs in the program’s first phase to enhance construction quality and climate resilience, including upgrading semi-permanent structures and installing sanitation and water connections. ADB also aims to encourage private sector financing through risk-allocation and guarantees. The collaboration will help to empower women, with 90% of financing targeted for women micro-borrowers.

Habitat for Humanity began in 1976 and has grown into a leading global nonprofit, working in more than 70 countries. Habitat’s Terwilliger Center for Innovation in Shelter works with the private sector to pilot new products and approaches for housing finance, materials, and services. From July 2019 to June 2020, Habitat helped more than 1.9 million people in Asia and the Pacific gain access to better housing.

ADB’s Private Sector Operations Department will also explore opportunities to work with Habitat for Humanity to scale the organization’s catalytic initiatives, including the MicroBuild Fund, which has deployed over $140 million in housing finance loans through MFIs, with 19% allocated in Asia and the Pacific. ADB’s Microfinance Program has helped more than 6 million borrowers gain access to microloans.

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Africa Today

The Gambia Secures More Funds for COVID-19 Vaccines

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World Bank Board approved $8 million additional financing from the International Development Association (IDA) to provide The Gambia with safe and effective vaccine purchase and deployment.

“With this additional financing, the World Bank is helping The Gambia strengthen their pandemic response and health care systems, as well as scale up its vaccination campaign, with a total contribution of $19 million towards the implementation of the Government’s National COVID-19 Preparedness and Response Plan,” said Feyi Boroffice, World Bank Resident Representative for The Gambia.

The additional financing for Gambia COVID-19 Vaccine Preparedness and Response Project will strengthen immunization systems and service delivery capacity to support the COVID-19 vaccination roll-out. It will expand The Gambia’s access to vaccines, through direct purchases from manufacturers and other arrangements through the African Vaccine Acquisition Trust convened by the African Union.

“The COVAX Facility will provide vaccine doses to cover 480,000 people and this additional financing from the World Bank will make it possible to have sufficient vaccine doses to cover 980,000 more people, with nearly all adults in the Gambia having access,” said Samuel Mills, World Bank Task Team Leader for the project. “It is now important for people to be adequately informed that the benefits of COVID-19 vaccination outweigh the risk of not getting the vaccine.”

To help prepare the National Deployment and Vaccination Plan for COVID-19 vaccines, the government conducted a vaccine readiness assessment with support from the World Bank, the World Health Organizations (WHO), the United Nation Children’s Fund (UNICEF) and the Global Alliance for Vaccines and Immunizations (GAVI). The assessment showed that the country has trained medical staff, a monitoring system in place, as well as adequate storage capacity to handle both routine vaccines and COVID-19 vaccine at temperatures between 2°C and 8°C. This additional financing will also support the procurement of ultracold freezers to augment the cold chain to store vaccines such as the Pfizer/BioNTech vaccine which require sub-zero storage, and the freezers will subsequently be used by the National Blood Transfusion Center for storing blood plasma.

In addition, the World Bank has supported the Ministry of Health in procuring innovative and environment friendly health care waste treatment technology to allow safe decontamination in hospitals. The Foundation Stone Laying Ceremony will be held tomorrow for the construction of clinical waste treatment centers at Farato and at Edward Francis Small Teaching Hospital. The project contributed to the renovation of the Ndemban Clinic, which operates as a COVID-19 treatment center, and procured 10 ambulances for intensive care, critical life-saving medical equipment and supplies, as well as six pickup trucks and 18 motorcycles to facilitate contact tracing and response.

This $8 million funding package for The Gambia is one of several projects in support for the COVID-19 vaccination effort across Africa and other regions. Today, the World Bank Board also approved additional financing for Côte d’Ivoire ($100 million), Eswatini ($5 million), Rwanda ($30 million), El Salvador ($50 million) and Honduras ($20 million).

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