Emerging Markets Impact Investment Fund
Outcome of tender processes
Following an open tender process, a consortium led by Sarona Asset Management Inc. has been appointed as Investment Manager for the Australian Government’s new $40 million Emerging Markets Impact Investment Fund (EMIIF).
Sarona is an experienced fund investor in frontier and emerging markets with a commitment to investing for environmental, social and governance impact as well as for profit. Sarona will partner with MEDA, Volta Capital and the Whitelum Group to meet EMIIF’s twin objectives of addressing the financing gap for small to medium sized enterprises (SMEs) that improve the lives of the poor, and building the impact investing market in South and South East Asia.
Professional trustee services firm, The Trust Company (RE Services) Limited, a wholly owned subsidiary of Perpetual Limited, has been appointed as EMIIF trustee following a separate open tender process. The EMIIF will be operational from 1 July 2020.
Catalysing Private Finance for Development
ODA can play an important role in catalysing private finance for development across the Indo-Pacific. The EMIIF demonstrates a new approach to working with the private sector to meet Australia’s development objectives. Recognising that SMEs are major drivers of inclusive economic growth and poverty alleviation but often lack access to the capital they need to grow, EMIIF will invest in funds that target early and growth stage SMEs. EMIIF will use a range of non-grant financial instruments such as loans, equity and guarantees to encourage additional investment into investee funds from private investors. It will also provide technical assistance to SME funds and SMEs to improve their commercial success and development impact.
The EMIIF will operate in countries across the Indo-Pacific such as Cambodia, Myanmar, Laos, Bangladesh, Sri Lanka, Indonesia, the Philippines, Papua New Guinea, the Solomon Islands, Vanuatu, Fiji, Tonga, Samoa and other Pacific Islands. It will invest across a variety of sectors including agriculture, healthcare, education, financial inclusion and clean energy.
Achieving strong development impact, including progress on gender equality, will be fundamental to EMIIF’s operations. Its investment strategy uses a gender lens to identify and make investments in SMEs that are women-led, provide products and services for women and girls, or promote gender equality in their workplaces.