Federal Government Grants Loans to Africa Investors | TIME ONLINE

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The Federal government wants to use a bundle of measures to boost investment in Africa. "We must make the transition to a self-sustaining upswing," said German Chancellor Angela Merkel (CDU) during an investor conference with twelve African states in Berlin. Federal Minister of Economics Peter Altmaier (CDU) and German Development Minister Gerd Müller (CSU) referred to a wide range of new tools for aid. These include a new program (Africa CIRR) with loans up to 85 million euros and fixed interest rates.

With the second major Africa Conference in Berlin after 2018, the Federal Government intends to intensify its involvement, above all with twelve states in the Compact with Africa campaign. The initiative launched in the German G20 presidency now includes twelve countries, such as Tunisia, Senegal, togoRwanda and Ethiopia, which are committed to more transparency and reform.

Already billion investment in Africa

Altmaier said, the angle of view Africa have changed completely in the past few years. Meanwhile, countries such as Senegal, Djibouti and Ghana are among the fastest growing economies in the world. In the first half of 2019, the trade balance of Germany had grown by nine percent, although the economy in the Federal Republic was paralyzed. German exports amounted to 23 billion euros last year and imports to 22 billion euros. "Since 2018, exports to the Compact countries alone, amounting to 330 million euros, have been secured by federal guarantees," Merkel said. There were applications of one billion euros.

Investment is also progressing, according to industry and government. "2018 was a record year for German investment," said the president of the Africa Association of German Business Stefan Liebing the news agency Reuters. The Ministry of Economic Affairs announced that German companies would have invested almost two billion euros in Africa in 2018. It looks similar this year. And Merkel mentioned that there are already 230 applications for a new loan program for SMEs.

Corruption, bureaucracy, lack of security

At the same time, the Chancellor called on African partners to be more transparent. "We believe that more transparency can also bring more investors to these countries," she said. Also Development Minister miller counted with the keywords "good governance, establishment of tax administration and audit courts,
Legal certainty, the fight against corruption and democracy "and some shortcomings." And Martin Wansleben,
Chief Executive of the German Chamber of Commerce and Industry
(DIHK) reported that "high bureaucracy,
Corruption or security issues "often prevent German companies from getting the first
Dare to go to Africa at all.

Criticism of the entire Compact Initiative came from the development aid organization Venro. Direct investment from abroad could only help to some extent in strengthening small and medium-sized African companies, said Bernd Bornhorst, CEO of Venro. "The Federal Government should set up special support measures for investments in African small and medium-sized enterprises and expand existing support instruments."

Africa (t) Federal Government (t) Angela Merkel (t) Togo (t) Rwanda (t) Gerd Mueller (t) Berlin (t) Senegal (t) Ghana (t) t) development policy

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