The EFSD constitutes the first pillar of the External Investment Plan, with the key objective to provide an integrated financial package to finance investments in the regions of sub-Saharan Africa and the European Neighbourhood. It includes both blending operations and guarantees.

The EFSD Guarantee supports operations that:

• address market failures or sub-optimal investments situations;
• ensure complementarity with other initiatives;
• ensure alignment of interest by providing adequate risk sharing between partners;
• are economically and financially viable (in some cases more concessional terms can be given);
• are technically viable and sustainable from an environmental and social point of view;
• maximise the mobilisation of private sector capital.

The EFSD Guarantee covers investments under five thematic investment windows:

• Micro-, small- and medium-sized enterprises (MSME) financing;
• Sustainable energy and connectivity;
• Sustainable agriculture, rural entrepreneurs and agro business;
• Digital for development; and
• Sustainable cities.

The guarantee also supports investments for financing in the health sector, notably to improve lab and diagnostic services for low income populations.

Such projects typically have a higher risk profile than the portfolio of investments supported by the eligible counterparts under their nominal investment policies without the EFSD Guarantee.

It is possible to combine financing with technical assistance to assist with sourcing and preparation of projects, as well as their implementation.

With the support of EFSD, SME Access to Finance Initiative aims to enhance access to finance for small and medium businesses in the EU's neighbouring countries and Sub-Saharan Africa.

In addition, EFSD also strongly supports the European Health Platform (EHP) initiative. EHP contributes via its vaccine component to the procurement of COVID-19 vaccines by countries in sub-Saharan Africa and the European Neighbourhood through the Gavi COVAX facility. Through its diagnostics component, EHP also aims to significantly improve access and quality of laboratory and diagnostic services for low-income populations in sub-Saharan Africa.

Operations launched under the EFSD Guarantee include:

• COVID-19 SME ACCESS TO FINANCE INITIATIVE, under which the below facilities were approved:
  • ECOBANK (ETI) COVID-19 GUARANTEE FACILITY
  • PALESTINE COVID-19 GUARANTEE FACILITY
• COVID-19 VACCINE VOLUME ALLOCATION (COVAX)
• COVID-19 VACCINE VOLUME ALLOCATION II - EFSD+

The EFSD Guarantee finances projects in Sub-Saharan Africa, the EU's Eastern Neighbourhood and Southern Neighbourhood.

• Check out the list of eligible countries

The EU's External Investment Plan (EIP) aims to encourage investment in the EU partner countries in Africa and the EU Neighbourhood region. It promotes inclusive growth, job creation and sustainable development and so tackle some of the root causes of irregular migration.

The EIP follows an integrated approach consisting of three pillars:

• Pillar 1: the European Fund for Sustainable Development (EFSD);
• Pillar 2: technical assistance to help authorities and companies to develop sustainable projects, and
• Pillar 3: activities promoting a conducive investment climate by broadening partnerships between the EU and its partner countries.

The European Fund for Sustainable Development (EFSD) comprises, beside the EFSD Guarantee two regional blending investment platforms:

• The Africa Investment Platform
• The Neighbourhood Investment Platform