EDFI

European Development Finance Institutions

The association of European Development Finance Institutions (EDFI) was set up in 1992. It has 15 members dedicated to financing the private sector in emerging and developing countries.
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EDFI's role is to promote technical and financial cooperation between its members, as well as with the other bilateral, multilateral and regional development finance institutions.

This cooperation between European institutions has led to the signing of several agreements that provide a framework for their investments, such as the Principles on Responsible Financing and Guidelines for Offshore Financial Centers .

It has also led to the creation of two mutual funds: European Financing Partners (EFP), dedicated to financing the private sector in the ACP (Africa-Caribbean-Pacific) region, and the Interact Climate Change Facility (ICCF), dedicated to the development of renewable energies and energy efficiency in Southern countries.

Building on a portfolio of over 4,000 projects for a total amount of some EUR 33bn in 2014, EDFI members are continuing to develop their technical and financial cooperation via staff training and exchanges, the organization of regular meetings between their teams, cofinanced operations…

This approach reflects the commitment of EDFIs to pool their resources and harmonize their practices in order to increase their impacts on development. It also contributes to enhancing their results and their joint positions on the private sector’s role in the South with national governments, international organizations and the European Union.

EDFI: The association of european development finance institutions

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The association of European Development Finance Institutions (EDFI) is one of the most dynamic achievements of this partnership between PROPARCO and its peers. It was set up in 1992 and includes 15 European bilateral institutions dedicated to financing the private sector in Southern countries.

Under the impetus of EDFI, PROPARCO has, for example, adopted several joint agreements with its European counterparts that provide a framework for its investments, such as the Principles on Responsible Financing . EDFI has also led to the creation of two funds: European Financing Partners (EFP) and the Interact Climate Change Facility (ICCF).

In order to facilitate experience sharing and capitalization, PROPARCO also works in partnership with EDFI members on conducting evaluations of jointly implemented operations.

European Financing Partners (EFP)

European Financing Partners (EFP) was set up in 2004 by the European Investment Bank (EIB) and 12 EDFI members, including PROPARCO. It is a joint venture dedicated to financing private sector operations in African, Caribbean and Pacific (ACP) countries.

In 2014, EFP’s total financing capacity stood at EUR 230m for individual projects of up to EUR 25m. EFP contributes a maximum of 75% of the cost of a project, including 50% provided by EIB, with the originating EDFI providing the remaining 25%.

EFP contributes to promoting sustainable private sector development in ACP countries, but also to strengthening cooperation between European financial institutions, especially between EDFI members and EIB.

Since it was set up, EFP had approved 32 projects for a total amount of EUR 442m at the end of 2013. Several operations conducted by PROPARCO have benefited from EFP sub-participations, such as a telecoms project in Tanzania (Millicom) and energy project in Jamaica (JPS), as well as a project for infrastructure in Sub-Saharan Africa (Africa Finance Corporation).

Interact Climate Change Facility (ICCF)

The Interact Climate Change Facility (ICCF) was set up in 2011 by AFD, the European Investment Bank (EIB), PROPARCO and 10 other EDFIs. It is a mutual investment fund dedicated to financing private sector operations for renewable energies (wind, solar, hydroelectric…) and energy efficiency in developing and emerging countries. This initiative is today held up as an example in terms of financial and technical cooperation among donors for “climate” projects.

The aim of ICCF is to contribute to reducing greenhouse gas emissions and promoting best environmental and social practices.

Between 2012 and 2014, ICCF committed EUR 269m for 15 “climate” projects submitted by its members, first and foremost PROPARCO, FMO and DEG. ICCF contributes a maximum of two-thirds of the cost in senior or subordinated loans, with the originating EDFI member providing the remaining third.

To date, AFD and PROPARCO have been among its main financial contributors in terms of financial input (a total of EUR 165m out of the EUR 458m available, i.e. 36%) and the amounts committed (EUR 101m out of a total of EUR 269m, i.e. 38%).

EDFI Booklet

EDFI Booklet

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