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Service for Foreign Policy Instruments
News article12 March 2019Service for Foreign Policy Instruments

The European Union injects €3.2 million to support the microfinance sector in the Central African Republic

PASM-RCA

On 22 February 2019, the Head of the EU Delegation to the Central African Republic, Samuela Isopi, and the Minister of Finance and Budget of the Central African Republic, Henri-Marie Dondra, officially launched a new European Union project to support the microfinance sector in Central African Republic. They were joined by several members of the Central African government, aRepresentative of France, the French Development Agency, the IRAM-ECHELLE consortium, technical and financial partner representatives and microfinance employers and institutions. The economic recovery and empowerment of Central African economic actors through the Bêkou Trust Fund form part of the priority intervention areas identified by European Union.

The project worth some € 3.2 million and funded under the Instrument contributing to Stability and Peace (IcSP) will ensure that basic financial services are made available to companies and the Central African population. It will also contribute to strengthening the capacity of the main actors in the microfinance sector of the Central African Republic.

Multifaceted resources will be put in place to support the various stakeholders of the institutional framework in the Central African Republic, the Professional Association of Microfinance Institutions, the microfinance institutions approved to better respond to financial needs, and local economic actors. While a majority of the population is currently excluded from the conventional banking network, this makes these institutions an ideal entry point to promote and secure small savings, and to facilitate the granting of microcredits and money transfers.

The European Union is therefore seeking to encourage the promotion of a more inclusive financial sector that offers tailored and lower cost products for all local economic actors. Meanwhile, the EU is also supporting a project of approximately €9.5 million that, since August 2016, has been strengthening the capacity of some 1,500 micro-entrepreneurs, economic interest group members, skilled tradespeople, farmers and breeders to enable them to develop bankable projects to submit to microfinance institutions and to receive coaching and consultancy support both before and after accessing credit.

In a continuation of this support, the European Union is also in the process of rendering operational the External Investment Plan in Central African Republic. Discussions with the private sector and the banking sector are underway to ensure that the Central African Republic can fully benefit from this initiative, which is embedded in the new Africa-Europe Alliance, launched by the President of the European Commission, Jean-Claude Juncker.

Managed by the European Commission’s Service for Foreign Policy Instruments, the Instrument contributing to Stability and Peace (IcSP) provides short- and mid-term assistance on conflict prevention, crisis-response and peace-building actions around the world. There are currently around 200 projects in over 75 countries. These IcSP projects are implemented by Non-Governmental Organisations, the UN and other International Organisations, EU Member State agencies and regional and sub-regional organisations.

For more information:

The EU's Instrument contributing to Stability and Peace

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Publication date
12 March 2019
Author
Service for Foreign Policy Instruments