DEG in financial year 2025
Focused promotion of impact and transformationFor more than 60 years, KfW subsidiary DEG has been an experienced partner for private companies and financial service providers active in developing markets. DEG comes alongside these organisations to help instigate the sustainable and economically successful transformation of the private sector. To this end, it provides them with budget-friendly long-term financing, largely from its own funds, and advises them on their investments and transformation processes.
In 2025, DEG successfully continued its journey despite persistent challenging global conditions, providing a total business volume of EUR 2.9 billion for investments by private companies in developing countries and emerging economies. The majority, at EUR 2.4 billion, was provided through DEG's own funds. DEG was able to mobilise further funds from private, institutional and public investors.
Our transformation projects
Small and medium-sized German companies are a key client group of DEG. It offers them appropriate financing, promotional programmes and advice, particularly in terms of sustainability and impact. Commitments in the German business reached a new high of around EUR 822 million in 2025. This also includes financing for local companies that purchase German equipment, for example.
More about investing abroad with DEG
Focus on climate and impact
DEG has aligned its strategy with climate and other impacts and documented this in its Impact / Climate Commitment. DEG’s portfolio is to be climate-neutral by 2040.
In the 2025 financial year, DEG allocated EUR 1.2 billion – a record amount – for projects that promote climate and environmental protection. In addition to providing financing, it also offers targeted consultancy services to support clients wanting to modernise their production and processing and helps them to align with the Paris Agreement.
DEG has developed its own Development Effectiveness Rating (DERa) to measure the development impact of its customers' investments in concrete terms. As in previous years, the rating for 2025 shows that the development impact of the projects co-financed by DEG is significant. Its customers in developing countries employed around 3 million people and generated EUR 185 billion in local income last year alone.
Expand financing offers
The ImpactConnect programme financed by the German Federal Ministry for Economic Cooperation and Development (BMZ) was expanded in 2025. The new TradeConnect guarantee instrument backs small-volume trade transactions by German companies in developing countries and emerging economies. At the end of 2025, the UkraineConnect programme was launched with funds from the German Federal Ministry for Economic Affairs and Energy (BMWE) to support business investments in Ukraine. For example, financing for the development of a 120-megawatt wind farm was committed.
Promoting climate action
Water vapour plays a central role in many industries, as it provides the heat necessary for various production processes.
Producing it requires high temperatures, which are usually generated with fossil energy. By contrast, DEG has provided one Brazilian plant manufacturer that relies on biomass and renewable electricity with equity amounting to USD 10 million. This promotes a more sustainable alternative method for generating the necessary thermal energy. In total, the plant manufacturer’s customers are already avoiding around 670,000 tonnes of CO₂e per year.
Supporting German companies
German companies are among the most important target groups for DEG. Some have a long-standing partnership that includes several financing rounds and consultancy services - including one horticultural company in southern Germany. DEG is currently providing the company with a loan of EUR 16.5 million. The aim is to expand production sites in eastern Africa, where the climate conditions are ideal for the cultivation of cuttings, such as for poinsettias. Part of the funds will also be invested in modernising local facilities.
Empowering small businesses
DEG has provided a loan of USD 50 million for commercial banks in Tanzania. A guarantee under the European Fund for Sustainable Development Plus (EFSD+) covers USD 10 million of the financing. The loan package is being used to finance loans for local small entrepreneurs, in particular women and young adults. This makes an important contribution to achieving the UN’s Sustainable Development Goals (SDGs).
Driving digitalisation forward
DEG has provided venture capital of USD 4 million for a South African online insurance platform. This fresh capital will support the company’s growth and enable increased investments in automation and AI, as well as product and market expansion. South Africa’s first fully digital insurance platform offers private customers insurance for cars, buildings and individual items.
Securing the energy supply for the long term
DEG has provided Cambodia’s leading provider of renewable energies with a loan of USD 47 million. Together with other investors, it is securing financing of USD 124 million for the construction of a 150-megawatt solar park in the province of Pursat with 30 megawatts of battery storage. The project is setting new standards for the financing of renewable energies in Cambodia and is supporting the target to increase solar PV capacity to 3.2 gigawatts by 2030. DEG’s client already operates over 600 megawatts of solar power and is strengthening the country’s energy supply and climate action through this project.
Legal notice:
The information contained in this online Annual Report 2025 is based on KfW’s Financial Report 2025, which you can download here. Should this online Annual Report 2025, despite the great care taken in preparation of its content, contain any contradictions or errors compared to the Financial Report, the KfW Financial Report 2025 takes priority.
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