By Chinedu James
Small and medium-sized enterprises (SMEs) across Africa are to benefit from a $100m loan support following a new deal inked by United Bank for Africa (UBA) and China Development Bank. More than 10, 000 SMEs in Africa will be benefiting from the loan scheme include SMEs that make up the continent’s financially challenged tech-startups.
Africa has experienced a boom in small and medium-sized enterprises (SMEs) sector even as they account for a great share in economic growth. These SMEs create around 80% of the continent’s employment opportunities and are central to Africa’s approach towards a technology driven economy.
SMEs across the region face challenges such as licensing, registration, taxation and lack of access to finance. The latter is highly crucial to the expansion, growth and transformation of these enterprises.
The challenge however will be mitigated as the United Bank for Africa (UBA) Plc announced the signing of a $100 million loan agreement with the China Development Bank (CDB).
The loan agreement with the world’s largest development finance institution which spans across seven years will enable UBA provide finance to small and medium enterprises across the 19 African countries they currently operate.
According to Mr. Tony Elumelu, Chairman, UBA Plc, the funds will adequately advance small and medium scale enterprises across Africa while also noting that CDB’s support aligns with the bank’s vision and passion in growing businesses in Africa.
“In UBA, CDB would have an enduring partner in reaching out to Africans as UBA provides banking services to over 14 million people across 20 African countries, and like CDB, UBA funds critical infrastructural projects on the continent “ Elumelu said.
Similarly, Mr. Kennedy Uzoka, Group Managing Director/CEO, UBA Plc while expressing delight at the timely nature of the funds stated that it will promote African entrepreneurship and also help in the recovery of economic activities.
“We are excited to partner with China Development Bank (CDB), the Development Financial Institution of the Chinese Government, on this historic transaction, as we strongly believe that the facility will serve as a catalyst to the sustainable development of commerce and industry in Africa through provision of critical financial interventions to SMEs across our presence countries,” he said.
Zheng Zhijie, the President of CDB expressed optimism that the cooperation between UBA and CDB will foster relations between China and Africa and Nigeria in particular.
“UBA is a leading and dependable bank not only in Nigeria but Africa, and this partnership will help our bank to accelerate its business objectives in Africa, more importantly as we deepen our investment in energy, road and rail constructions, infrastructure in Africa,” Zhije said.