For corporate success and development
Employment and income are fundamental in giving people new prospects and overcoming poverty. Entrepreneurial initiative is the most important driver in achieving this aim, as most jobs are created in the private sector. However, many companies in developing countries lack the long-term funds necessary for expanding their business and thus ensuring its lasting success.
This is where DEG comes in. For 55 years, we have funded, advised and supported private enterprises active in developing countries and emerging economies. There is also demand for our advice to and professionalisation of companies in areas such as corporate governance, environmental and social management and resource efficiency.
As private companies are key drivers of skilled jobs, income and prospects in our partner countries, financing and consulting such companies is a key aspect of DEG's work
Bruno Wenn, Chairman of DEG's Management Board
DEG finances investments in a variety of industries and sectors. For example, in 2017, it granted a loan of several million US dollars to Waelzholz Brasmetal, the Brazilian subsidiary of the German Waelzholz Group, for expansion plans. Waelzholz produces cold-rolled steel strip for the manufacturing industry. DEG also granted CHG-MERIDIAN Mexiko a long-term loan of EUR 20 million. CHG-MERIDIAN Mexiko will use the funds to expand its offering, particularly for small and medium-sized enterprises that wish to lease IT equipment, for example.
Climate and environmental protection activity
Protecting climate and the environment and mitigating the impact of climate change constitute another important aim of DEG's work. A total of EUR 556 million in new commitments in 2017 was earmarked for financings that promote climate and environmental protection as well as adaptation to climate change. Financing committed by DEG in 2017 for renewable energy projects will, after start-up, lower carbon dioxide emissions (CO2) by 2 million tonnes per year. This volume equates to about 50% of Namibia's annual greenhouse gas emissions. In 2017, for example, DEG took a 10% equity stake in Cibuk I, Serbia's largest wind farm, which is expected to supply around 113,000 households with green electricity after commencing operations.
Financing in cooperation with other development financiers
As one of the leading European development finance institutions, DEG works closely with other development financiers to jointly achieve higher efficiency, effectiveness and visibility. A special priority is the cooperation with members of the European Development Finance Institutions (EDFI), such as the Dutch FMO and the French PROPARCO. Together with these partner organisations, DEG committed a total volume of EUR 1.28 billion to 38 projects in 2017.DEG's share of this financing amounted to EUR 441.8 million. DEG also cooperates with multilateral financiers, such as IFC.
DEG committed to 28 projects with a total volume of EUR 1.28 billion in 2017 (2016: EUR 860.2 million), as part of its close collaboration with Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO) and the French Development Finance Institution Société de Promotion et de Participation pour la Coopération Economique (PROPARCO). DEG's share of this financing amounted to EUR 441.8 million (2016: 274.1 million).
In addition to its own funds, DEG actively mobilised EUR 247 million from development banks and private institutional investors, as a lead arranger for 15 projects in 2017. Some EUR 73 million of this amount came from private companies.
Read more about DEG's tasks
Read more on our focal areas in 2017
The information contained in this online Annual Report 2017 is based on KfW’s Financial Report 2017, which you can download Should this online Annual Report 2017, despite the great care taken in preparation of its content, contain any contradictions or errors compared to the Financial Report, the KfW Financial Report 2017 takes priority.