The European Union approves a new combined financing program led by COFIDES with funds from AECID and the European Commission

The Operating Committee of the European Fund for Sustainable Development (EFSD+) has approved the Conecta por Guatemala (ConectaxG) blended finance program, led by COFIDES. 

ConectaxG has  benefited from the participation of AECID through FONPRODE (€42M) together with a European Union allocation for technical assistance (€6.7M) that will be managed by COFIDES. The European Union's contribution will be made through its Latin America and Caribbean Investment Facility (LACIF). 

The director of Multilateral, Horizontal and Financial Cooperation of AECID, Fernando Jiménez-Ontiveros, stated that "from AECID, we are very proud to be part of a project as relevant as ConectaxG, which has the potential to transform the entrepreneurial ecosystem in Guatemala. This program not only strengthens the microfinance sector, but also promotes the economic empowerment of women, who are a vital part of the country's productive system. The collaboration with the European Union and COFIDES reinforces our commitment to reducing inequalities and promoting sustainable and inclusive development, in line with the Sustainable Development Goals."

He also expressed his conviction that this type of initiative, which combines public and private financing, "allows us to maximize the impact of our resources and reach those who need them most, supporting the digital and green transformation of micro and small companies. Guatemala has great potential, and we are convinced that ConectaxG will be a fundamental pillar for building a more prosperous, inclusive and resilient future for the country and its people.”

On its own part, COFIDES' Director of Partnerships for Development, José Carlos Villena, highlighted that "the approval of this new program with the European Union ratifies COFIDES as a major player in the field of blended finance" and stressed that "ConectaxG will contribute to strengthening the private sector in Guatemala, creating more opportunities and generating more investment in the microfinance sector.” 

79,000 RECIPIENTS, 70% WOMEN

This new program aims to promote the development of the Guatemalan MSMEs ecosystem, especially micro and small growing businesses, from a green and digital transition perspective. It is expected to benefit about 79,000 people, of whom about 70% are women. To this end, within the framework of the Program, direct investments will be made through FONPRODE financing and support will be provided through technical assistance to financial service providers.

It will focus on two action sectors, digital transformation and financial inclusion, and two other cross-cutting sectors: Green transition and gender. 

ConectaxG is a project within the framework of the European Union's Global Gateway strategy and will contribute to the development of three projects in Guatemala:  

• Green transition in Petén, through the promotion of green and sustainable entrepreneurship and the use of climate-smart technologies.     
• Motagua River Basin, by supporting sustainable agricultural practices.  
• Digital transformation in Guatemala, supporting access to financing for Fintechs and the digital transition of MSMEs. 

It is also part of the Team Europe Initiative, (TEI) for Inclusive Economic Development in Guatemala, focused on access to microfinance for MSMEs and the most vulnerable population.

ABOUT COFIDES

COFIDES is a state-owned trading company that manages state funds, as well as its own resources and those of third-party institutions. COFIDES's mission is to support the internationalization of the Spanish economy, attract foreign investment into strategic sectors in Spain, promote the impact economy, and contribute to global economic development. COFIDES is also instrumental in strengthening the solvency of Spanish companies, particularly in response to challenges such as the COVID-19 pandemic. COFIDES’s shareholders include the Spanish State, Banco Santander, Banco Bilbao Vizcaya Argentaria (BBVA), Banco Sabadell, and CAF-Development Bank of Latin America.

ABOUT THE EUROPEAN UNION

The European Union manages the Latin America and Caribbean Investment Facility (LACIF), a regional blending mechanism. LACIF promotes the mobilisation of funds from European and regional financial institutions, governments and the private sector to carry out sustainable development projects in Latin America and the Caribbean. LACIF's objective is to help these countries by way of the finance of projects in key sectors for the achievement of the Sustainable Development Goals, such as: renewable energy, environment, water and sanitation, urban and rural transport, and promotion of small and medium-sized enterprises.

ABOUT AECID - FONPRODE

The Spanish Agency for International Development Cooperation (AECID) is the principal management body for Spanish Cooperation. Attached to the Ministry of Foreign Affairs, European Union and Cooperation, it manages the Development Promotion Fund (FONPRODE) with the aims of eradicating poverty, reducing social inequality and inequity among people and communities, and promoting gender equality, defense of human rights and human and sustainable development of poor countries.