Access to renewable energy is a crucial factor for economic growth and poverty reduction. Today, around 750 million people lack access to electricity, three quarters of whom live in sub-Saharan Africa and the least developed regions of Asia.
The Energy & Climate sector only invests in renewable energy sources. The expansion of sustainable energy supplies requires a broad approach and innovative solutions. Through our investments, we finance both grid-connected power sources as well as stand-alone, so-called off-grid solutions that enable households, villages and communities to utilise locally produced energy.
We also finance broader climate investments such as energy and resource efficiencies that are key to the green transition. The sector also includes green infrastructure, such as water and waste management, digital infrastructure, forests and other carbon sinks, as well as biodiversity projects.
With a growing population and an increasing number of young people entering the labour market, an additional 600 million jobs need to be created by 2030. These should be productive jobs in the formal sector with decent working conditions. Nine out of ten jobs are created in the private sector and investments are required to allow businesses to grow, employ more people and contribute to increased tax revenues. Small and medium-sized enterprises often face difficulties in accessing capital to grow, increase their productivity or otherwise develop their business. Depending on where a company is on its growth journey, different types of capital are required in the form of investments in equity or loans.
The Sustainable Enterprises sector increases the availability of equity directly or indirectly, contributing to the sustainable development and growth of the private sector in developing countries. Imposing requirements and encouraging portfolio companies to attain international standards in areas such as sustainability, for example, promotes sustainable development of the private sector. Mobilisation of capital from institutional and private investors is also facilitated. Digital business models, gender equality and health are prioritised thematic areas for investment.
In developing countries, small and medium-sized enterprises account for the majority of all jobs and drive economic and social development. Lack of financing is one of the most limiting factors for these companies’ opportunity to grow. Financial Inclusion invests in, amongst others, regulated banks and microfinance institutions to reach out more broadly and effectively. In addition to enabling increased lending to the banks’ customers, we also help develop institutions’ work on sustainability and corporate governance, which are important aspects for inclusive growth.
Swedfund also invests in microfinance institutions that provide microloans to entrepreneurs, small businesses and and low-income earners. We require microfinance institutions to comply with the Customer Protection Protection Principles (CPP) which certify that they actively work with responsible lending and management. For example, pricing should be transparent, excessive indebtedness should be avoided, debts are collected responsibly and personal integrity is respected.
Globally, three billion people cannot afford a nutritious diet and more than 800 million people are undernourished. Despite favourable conditions for agriculture and food production, Africa imports up to 65 percent of the continent’s food. A key area to address in this context is the low level of processing, which is an important factor in reduccing food insecurity and nutritional deficiencies. In many countries, large quantities of food never reach the market and becomes waste. At the same time, food insecurity is exacerbated by factors such as climate change, geopolitics, war and population growth.
In the Food Systems sector, we contribute to increased food production, less waste during production and increased sustainability throughout the value chain. Investing in the food sector creates formal jobs, economic empowerment and increased food security through increased production and improved resource and energy efficiency. If investments are made correctly, they can be clmate-adapted to better respond to climate change and reduce the negative impact on biodiversity.
