On 9th and 10th December, Ms Arianna Vannini, Principal Advisor on Investment Strategy for Development and Innovative Financing of the European Commission's Directorate General for International Cooperation and Development (DEVCO), visited Sierra Leone accompanied by DEVCO D1, Dorota Panczyk, and Directorate C colleagues, Ebba Aurell, Ivana Stanajevic, and Mateja Peternelj.
During the mission, she attended the Private Sector Event organised in the framework of the External Investment Plan Road Show, in which the Minister of Finance, Government and private sector representatives, International Financial Institutions and representatives of commercial banks participated. The mission was an opportunity to carry-out key bilateral meetings, namely with the President of the Republic of Sierra Leone, the Minister of Finance, the digital and economic advisory teams of the President, as well as with the first female Mayor of Freetown, Mrs Yvonne Aki-Sawyerr.
The visit confirmed the positive and constructive partnership with the EU. During all the exchanges, Ms Vannini presented the new Commission’s priorities and engaged in more details on the Africa-Europe Alliance and the European Investment Plan. She highlighted the need to improve the investment climate in Sierra Leone and to strengthen the dialogue with the private sector as the only way to build a mutual understanding on what is really needed to attract private sector investment.
Mrs Vannini also had fruitful discussions with the digital and economic advisory teams of the President, notably on the need to strengthen regulatory and legal frameworks as well as access to finance for SMEs and the need to boost capacities and skills of young people.
PRESS RELEASE - The European Union showcases its External Investment Plan in Sierra Leone
The European Union External Investment Plan (EIP) was officially brought to the attention of Sierra Leone on 9 and 10 December 2019 in Freetown during the EIP road show. This plan is a contribution to the mplementation of the Africa-Europe Alliance for Sustainable Investments and Jobs. The ultimate goal of the alliance is to strengthen economic and commercial ties between the two continents in order to create jobs and ensure sustainable growth in the framework of an integrated and participative approach.
"If we are to attain the United Nations Sustainable Development Goals (SDGs) by 2030, we need to invest heavily in many sectors such as transport and energy infrastructures, water and sanitation, health and education. We need to create jobs and sources of revenue. The World Economic Forum has estimated that the global investment gap to achieve these goals is 2.5 trillion USD per year. We, the EU and development partners, can do our part with traditional sources of aid. But obviously, this will not be enough. If we want to get there, we need to mobilise private investment”, Ms. Arianna Vannini, Special Adviser on Investment Strategy for Development and Innovative Financing at the Directorate-General for Development of the European Union Commission highlighted.
The EU, through the EIP, wishes to stimulate the adoption of innovative financial instruments, namely risk-mitigating guarantees in private investments and donations-loans combinations ("blending”). Furthermore, the EIP hopes to participate in improving business climate by encouraging a regular, relevant and structured dialogue with the private sector and the government. "We need to look out for the private sector and donors are structuring their instruments to reach them. The government is engaged in that path and have started to address business environment constraints. For instance, the Investment Board has been created and will serve as a One Stop Shop for investors. The Government is also looking at easing the revenue collection processes with more automation”, Sierra Leone’s Minister of Finance, Mr. Jacob Jusu Saffa underscored.
International financial institutions partnering with EU are entrusted to implement EIP’s guarantees. Some of them, namely the European Investment Bank (EIB), the French Development Agency (FDA), the African Development Bank (AfDB), the International Financial Corporation (IFC) and the Dutch Entrepreneurial Development Bank (FMO) have presented some of the guarantees supported by EU.
An audience granted by the Minister of Finance, this February 10 allowed Ms. Arianna Vannini to discuss EIP’s opportunities for Sierra Leone and the necessity to improve Sierra Leone’s business and investment climate, so as to fully harness the EIP initiative.
The EU External Investment Plan is using €4.5 billion in public funds to secure €44 billion by 2020 in public and private investment for development in countries neighbouring the EU and in Africa. To date the EU has allocated €4.2 billion. This is set to leverage €41.5 billion in overall investment.
The plan has three parts. The first is finance. Through financial guarantees, the EU shares the risk so that private investors and development banks will lend to entrepreneurs or finance development projects. And through so-called blending projects, the EU covers part of the costs of a development project through a grant, with public and private investors financing the rest.
The plan’s second part is technical assistance. This funds experts who help develop new projects, enable local and EU firms to draft business plans, and support governments in enacting reforms.
The third part is investment climate support. The EU works closely with governments in partner countries to help them improve the conditions which investors consider when making their decisions. These include the business environment and a country’s political and economic stability. The EU also brings together governments and business to discuss investment challenges.
The External Investment Plan is a key part of the Africa-Europe Alliance, launched by European Commission President Jean-Claude Juncker in September 2018. The Alliance aims to boost investment which creates jobs and promotes sustainable development.