Accelerating progress on sustainable development
The last few years have been marked by global challenges and crises, such as Russia’s full-scale invasion of Ukraine, the Covid-19 pandemic, conflicts flaring up in the Middle East and the increasing frequency of climate-related natural disasters. Combined with macroeconomic challenges, this has led to reduced flows of foreign direct investment into developing countries and an increased risk profile of Swedfund's investment countries. Despite this uncertainty, Swedfund's pace of investment during the 2020–2023 business plan was higher than ever. This has been made possible thanks to dedicated and competent employees who have worked hard to overcome unexpected challenges, a business model that has proved to work well in crises, and the government’s and parliament’s confidence in Swedfund as demonstrated by the increased capital injection.
The climate crisis is one of the greatest challenges of our time, and it is gratifying to note that historic decisions were taken during COP28 by including decarbonisation in the global climate agreement for the first time. The earmarked capital injection of MSEK 460 approved by parliament allows us to accelerate investments in climate mitigation, adaptation and resilience. The Energy & Climate sector saw the greatest expansion in terms of investment volume during the business plan period. In this sector, Swedfund contributes to the green transition by investing in increased capacity for renewable energy production, climate mitigation and increased societal resilience.
During 2023, we invested SEK 2.5 billion in poverty reduction, climate and development. SEK 1.46 billion was financed through the capital injection approved by parliament and the remaining through reflows from exited investments. Collaboration between the EU and the European development finance institutions deepened and increased in scope, particularly regarding the implementation of the Global Gateway and Team Europe initiatives. Development finance institutions are considered to be important actors in their implementation. We have raised our ambition regarding an increased number of investments in the food sector. In early 2024, we invested in Apollo Agriculture, which provides smallholder farmers in Kenya with agricultural products along with distribution, advice, insurance and financing. The investment is also the first to deploy a Global Gateway guarantee.
In 2023, we agreed on 14 new investments in the Energy & Climate, Financial Inclusion and Sustainable Enterprises sectors. This contributed to a portfolio value amounting to just over SEK ten billion at the end of 2023 and a portfolio value increase of SEK 1.6 billion. Operating profit, excluding currency effects, amounts to MSEK -16 for the full year, with the negative result being primarily attributable to write-downs in the equity and fund portfolio. Dividends and net interest income continued to develop positively during the fourth quarter, contributing to a positive operating profit where recurring income exceeded operating expenses by a good margin. The return on the investment portfolio expressed through IRR remained stable at the end of the year, corresponding to 4.6 percent of the total portfolio.
We continue to demonstrate good results that align with our business model’s three pillars and mission objectives.
The climate crisis is one of the greatest challenges of our time, and it is gratifying to note that historic decisions were taken during COP28 by including decarbonisation in the global climate agreement for the first time. The earmarked capital injection of MSEK 460 approved by parliament allows us to accelerate investments in climate mitigation, adaptation and resilience. The Energy & Climate sector saw the greatest expansion in terms of investment volume during the business plan period. In this sector, Swedfund contributes to the green transition by investing in increased capacity for renewable energy production, climate mitigation and increased societal resilience.
During 2023, we invested SEK 2.5 billion in poverty reduction, climate and development. SEK 1.46 billion was financed through the capital injection approved by parliament and the remaining through reflows from exited investments. Collaboration between the EU and the European development finance institutions deepened and increased in scope, particularly regarding the implementation of the Global Gateway and Team Europe initiatives. Development finance institutions are considered to be important actors in their implementation. We have raised our ambition regarding an increased number of investments in the food sector. In early 2024, we invested in Apollo Agriculture, which provides smallholder farmers in Kenya with agricultural products along with distribution, advice, insurance and financing. The investment is also the first to deploy a Global Gateway guarantee.
In 2023, we agreed on 14 new investments in the Energy & Climate, Financial Inclusion and Sustainable Enterprises sectors. This contributed to a portfolio value amounting to just over SEK ten billion at the end of 2023 and a portfolio value increase of SEK 1.6 billion. Operating profit, excluding currency effects, amounts to MSEK -16 for the full year, with the negative result being primarily attributable to write-downs in the equity and fund portfolio. Dividends and net interest income continued to develop positively during the fourth quarter, contributing to a positive operating profit where recurring income exceeded operating expenses by a good margin. The return on the investment portfolio expressed through IRR remained stable at the end of the year, corresponding to 4.6 percent of the total portfolio.
We continue to demonstrate good results that align with our business model’s three pillars and mission objectives.
- Approximately 338,000 people work in our portfolio companies. 57 percent of our investments have increased their number of employees and we have contributed to 1.9 million indirect jobs.
- Our investments contribute to 11 TWh in energy production and around 570,000 households and companies have gained access to energy through off and minigrids.
- We have provided capital to small and medium-sized enterprises through 690,000 loans.
