KfW Development Bank 2019

* Differences in the totals are due to rounding

* Differences in the totals are due to rounding

Climate change cannot be slowed without a transport transition. Transport is one of the major emitters of greenhouse gases. KfW is therefore committed to sustainable mobility worldwide. The German Federal Government (Federal Ministry for Economic Cooperation and Development (BMZ)) has launched an initiative for sustainable transport in cities – the Transformative Urban Mobility Initiative (TUMI). A total of EUR 557 million was committed for projects under this initiative in 2019.

Digitalisation also offers new possibilities, such as in traffic management systems and self-driving vehicles in “Smart Cities”. One such example is the Indian government’s Smart Cities Mission, which aims to support 100 Indian cities in implementing sustainable urban concepts – also in urban mobility. The state of Tamil Nadu will introduce 500 electric buses into the local public transport system, and replace 2,000 old diesel buses with more energy-efficient models.

KfW Development Bank currently has 138 ongoing refugee-related projects in 31 countries; the total project volume amounts to EUR 4.9 billion (of which EUR 949 million went to new commitments in 2019). Assistance provided by the 2019 commitments will reach more than 14 million refugees, displaced persons and residents of host communities, with all current projects reaching more than 40 million people in total. The effects range from short-term food supplies through the World Food Programme, to employment support measures, improvements to drinking water supply facilities in refugee camps and host communities, and the creation of housing. The regional focus is on the Middle East and East Africa/Horn of Africa.

The German Federal Government (BMZ) is also supporting the G20 “Compact with Africa” initiative as part of reform partnerships (RP) with substantial bilateral funding commitments. Six reform champions have been selected so far:

• Tunisia: The reform partnership focuses on the financial and banking sector and the governance area in cooperation with the World Bank with a current financing volume of EUR 893 million. EUR 103 million was disbursed in 2019.
• Côte d’Ivoire: EUR 100 million has been earmarked to expand renewable energy (solar and wind) and energy efficiency through private enterprise. EUR 66 million was disbursed at the end of 2019.
• Ghana: The governance sector is being established as the second pillar of the reform partnership after the energy sector, in cooperation with the EU. EUR 201 million is available thus far for both sectors.
• Senegal: With EUR 77 million to date, the reform partnership is focused on sustainable economic development (financial sector, vocational training and land rights).
• Ethiopia: Very close cooperation has been established with the World Bank and the French Development Agency (Agence Française de Développement - AFD). The first EUR 110 million is about to be disbursed under the joint “Growth and Competitiveness” programme.
• Morocco: The BMZ committed EUR 535 million in 2019 under the reform partnership for financial system reforms and a loan guarantee mechanism for SMEs.

KfW founded the special-purpose limited liability company “Investments for Employment” in November 2019 as part of the BMZ's “Special Initiative on Training and Job Creation”. Almost EUR 98 million in BMZ cash was paid into this FC facility in December 2019 and it is expected to increase to up to EUR 400 million in the future. Competitive rounds in the six reform partnership countries as well as Egypt and Rwanda will be used to finance investments that will enable German, European and African companies to create more jobs and training places.

KfW, together with DEG and the Allianz Group, provides financing and advice to African SMEs and start-ups via a fund of funds called AfricaGrow. As a legally independent entity, the AfricaGrow Fund is a central instrument of the Compact with Africa (CwA) initiative and is part of the German Federal Government's development investment fund. The budget funds payment of EUR 100 million (including EUR 15 million from the Technical Assistance Facility) was made in December 2019. The Allianz Group and DEG will invest in a subordinated tranche (EUR 30 million and EUR 55 million, respectively).

EUR 26.5 million was committed for a vocational training project in Ethiopia in 2019, including EUR 10 million from the “Digital Africa” initiative to improve teacher training. The project will focus to this end on introducing teaching methods based on modern information and communications technology (ICT). The idea is to enable a uniform, high standard of training to be offered and improve teachers’ digital skills. It includes hardware, software and training as well as a management information system (MIS) for pilot vocational schools and the Ministry of Education.

The education sector plays a key role in driving the country's economic development and creating prospects for the growing population. The percentage of young people in the labour force is continuously increasing. It is important that the training have a practical focus, which is ensured by involving industry and the private sector, often based on the German dual training model. However, the qualitative and quantitative course offering at many vocational schools and universities is still inadequately adapted to the changing needs of the Ethiopian economy.

KfW Development Bank has been working in Ethiopia since 1964, and has thus far made more than EUR 1 billion available.