CDC Group, the UK’s development finance institution, announced today that it had made investments totalling $1.57 billion (£1.22 billion) in 2020 as it provided vital support for developing economies devastated by the COVID pandemic. The announcement was part of the launch of our Annual Review 2020: Rising to the challenge.
The company, which invests in private businesses in Africa and south Asia, said the figure represented a significant achievement in the wake of the disruption to its operating model caused by the pandemic.
CDC confirmed that about $1 billion was directly allocated to fighting the economic fallout of the pandemic. This included providing vital liquidity in its markets to support SMEs and entrepreneurs, direct support for its portfolio of around 1,200 companies and bolstering the abilities of healthcare providers to fight the pandemic.
Despite the impact of the pandemic, the £1.22 billion was the second highest level of investments CDC has committed in a single year, underlining its importance as a counter-cyclical investor in a time of significant global economic slowdown.
Speaking at the publication of the company’s 2020 Annual Review, CDC Chairman, Sir Graham Wrigley, said: “With an annual commitment of £1.2 billion, at a time when capital retreated from Africa and South Asia, we’ve provided much-needed, impact-driven, targeted capital and liquidity to our partners on the ground. To achieve this, we needed both a rapid and new approach in the most challenging of times.”
The economic impact of COVID-19 has pushed around two per cent of the global population – 140 million additional people – into extreme poverty.
Chief Executive of CDC, Nick O’Donohoe, said: “The countries where we invest do not have the NHS or the same fiscal support schemes that have been provided by our own Government in the UK. As the scale and impact of the pandemic became clear early last year, we knew we needed to act with the same urgency to provide support and to rise to the challenge.”
Of the £1.22 billion, African businesses received £827 million, south Asian businesses received £118m, with the balance of £276 million invested in companies operating in both regions.
The Annual Review document can be found here