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For more than twenty-five years, Luxembourg’s Development Cooperation has been actively supporting the development of microfinance and inclusive finance to reduce global poverty, using the expertise and potential of Luxembourg’s financial market to promote economic development, inclusive growth and the socio-economic inclusion of women and youth.

The flagship event of 2019 was the African Microfinance Week (SAM), held in Ouagadougou, Burkina Faso. Despite a difficult security environment, more than 900 participants were present at the opening, and Minister Lenert and the Prime Minister of Burkina Faso, Christophe Joseph Marie Dabiré, participated. The theme of this third edition was: ‘Pathways Towards Impact: African Inclusive Finance for the Sustainable Development Goals’.

In addition, the NGO ADA, the organiser of this conference and Luxembourg’s Development Cooperation’s main partner in inclusive finance, celebrated its 25th anniversary in 2019. With the support of the MFA, it has expanded its activities to Niger and Tunisia. It has further expanded the scope of the research of the ADA Chair at the University of Luxembourg, whose studies have been well received by inclusive finance regulators, notably within the Alliance for Financial Inclusion (AFI) network, with whom close contacts have been forged, as dialogue with Luxembourg actors has been boosted.

Another important event was the European Microfinance Award ceremony, held as part of European Microfinance Week. This is a regular and high-level meeting, which was held at the European Investment Bank (EIB) headquarters in the presence of Minister Paulette Lenert, EIB President Werner Hoyer, and around 350 experts from the sector. In 2019, the award recognised the best innovations to strengthen people’s resilience to climate change. The award was won by APA Insurance, a Kenyan insurance company offering index-based insurance to small-scale and subsistence farmers.

In partnership with the Ministry of Finance, Luxembourg’s Development Cooperation has launched the Financial Inclusion Fund (FIF) with the EIB. This multi-donor fund will support African microfinance institutions (MFIs) to tailor their services to the needs of their customers, particularly young entrepreneurs, and to mobilise the resources needed to refinance the sector. As part of its collaboration with the EIB, Luxembourg’s Development Cooperation has also financed technical support to five MFIs in the Sahel, enabling them to improve social performance management and to accelerate the digitisation process.

The Luxembourg Microfinance and Development Fund (LMDF) is a public-private microfinance investment fund whose activity consists of targeted support for small and medium-sized microfinance institutions. Through its investments in Asia, Africa, and Latin America, the fund, which in 2019 had grown to EUR 34 million, financed more than 55,000 micro-entrepreneurs and created measurable results in terms of financial inclusion.

Together with the Ministry of Finance and the Ministry of the Environment, Climate and Sustainable Development, Luxembourg’s Development Cooperation continues to support investment in sustainable projects. Through technical assistance to the Forestry and Climate Change Fund (FCCF), the Directorate promotes investment in tropical forest forestry projects in Central America, with the objective of restoring secondary or degraded forest areas and making them economically, environmentally and socially viable.

To transform and modernise family farms in Burkina Faso and Mali, and to facilitate their access to financing, SOS Faim is implementing the Agri+ project under the mandate of Luxembourg’s Development Cooperation for the 2016-2022 period.