10 July 2015, Sweetcrude, Lagos – The Board of Directors of the African Development Bank (AfDB) approved on Thursday, July 9, 2015 a line of credit amounting to ZAR 4.5 billion (about US $450 million) to Development Bank of Namibia (DBN) to finance projects in key priority sectors in the country including infrastructure, manufacturing, logistics and tourism.
The LOC will enhance DBN’s liquidity and ability to provide financing on appropriate terms to projects and enterprises in key sectors including those with lower levels of economic activity, infrastructure and formerly disadvantaged segments of Namibia’s population, particularly women and young entrepreneurs. The financed projects and enterprises are expected to contribute to Namibia’s economic development, generate employment opportunities and reduced income inequalities. In addition, the LOC is expected to contribute to infrastructure development through the provision of support to energy and transport infrastructure initiatives; contribute to private sector development through alleviation of financing constraints, as well as contribute to gender and social development through support to projects in rural underserved communities and social infrastructure initiatives such as vocational training and health facilities.
DBN is a national development finance institution that was founded in to promote and finance development in sectors which support development and the welfare of the citizens of the country. The bank is fully owned by the Government of Namibia and provides support to its target beneficiaries in form of loans, equity partnerships, financial advisory services, management services, and export/import finance. It has maintained a solid financial track record, consistently posted healthy profits and achieved good asset quality over the years. DBN is well ranked by the Association of African Development Financial Institutions and has strong corporate governance and risk management structures and processes.
AfDB’s provision of long-term financing is a major boost in the diversification of DBN’s funding base because it provides a credible benchmark in terms of size and tenor. The project signifies strengthened relations between the African Development Bank and the Government of Namibia, and the beginning of a partnership with DBN.