BCI YOUTH & GENDER LOAN FOR SMES AND MIDCAPS

The proposed operation involves a Multiple Beneficiary Intermediated Loan of up to €25 million to the Banque pour le Commerce et l'Industrie (BCI). This loan is aimed at supporting eligible small and medium-sized investments undertaken by private companies, particularly small and medium businesses and mid-caps, in Mauritania, with a focus on youth employment and gender equality and women's economic empowerment, in line with the 2X Challenge Criteria.

This operation will aim at on-lending to small and medium businesses (SMEs) and mid-caps in Mauritania and will focus on youth and gender inclusion, while targeting green investments: - A minimum of 50% of the loan amount will be specifically targeting businesses led and/or founded by a young entrepreneur, employing at least 40% of young people, or having in place a policy and a commitment to implement a programme to train and skill young persons. Young people / entrepreneurs are defined as people between the ages of 15 to 35 years, in line with the African Youth Charter; - A minimum of 40% of the loan amount will be specifically targeting businesses owned, run, employing or primarily serving women, in line with the 2X Challenge criteria, hence promoting gender inclusion and women empowerment in businesses. In October 2019, EIB adopted the 2X Challenge Criteria to define what the Bank consider as financing for gender equality; - In addition, on a best effort basis BCI will focus on green investments defined as projects eligible under the EIB Climate Action & Environmental Sustainability priority. Eligible sub-projects could relate to climate adaptation investments or climate mitigation investments such as renewable energy generation, energy efficiency improvements, sustainable agriculture, low carbon road vehicles fleet, waste collection and transport, water supply, pollution prevention and control investments.

Access to finance for corporates in Mauritania is limited and the labour market participation rate is lower than in the region, with a large percentage of young Mauritanians unemployed and untrained, and a declining financial inclusion of women.

The proposed operation aims at on-lending to private businesses, notably SMEs. It will contribute to the private sector inclusive growth and will target specifically decent job creation for youth and youth

entrepreneurship and businesses owned, run, employing or primarily serving women.

The project is aligned with the EU's external action, the Neighbourhood, Development and International Cooperation Instrument (NDICI) and the Multiannual Indicative Program (MIP) for Mauritania 2021-2027 which promotes strong, sustainable and inclusive growth, and will contribute to the achievement of several Sustainable Development Goals.

The availability of longer-term funds will enable BCI to extend the tenors of its loans. Innovative features include a flexible maturity of the disbursements, long deferral of amortisation, convertibility of the rate structure. A portfolio guarantee will be deployed in parallel to enable BCI to improve its lending terms. It is expected that technical assistance will be provided to BCI to set up reporting practices based on the recommendations of the Taskforce on Climate-related Financial Disclosures. 

The Bank will require BCI to take all the requisite measures to ensure that the procedures, including procurement procedures carried out by the Final Beneficiaries for the sub-projects receiving Bank financing, will comply with national legislation and the ElB's Environmental and Social Standards as well as international treaties and conventions signed and ratified by or otherwise applicable and binding in the country.

The Bank will require BCI to take all requisite measures to ensure that any procurement procedures carried out by final beneficiaries for the sub-projects that the Bank finances are in accordance with the Bank's Guide to Procurement.

Under EFSD+ Guarantee