The European Investment Bank (EIB) and East African-based regional development body, PTA Bank, have jointly launched a €160m ($180.69m) lending initiative to support investment across eastern and southern Africa.

The EIB has agreed to provide €80m ($90.34m) for the new initiative that will be matched by PTA Bank and represents the largest single private sector lending scheme ever backed by the EIB in Africa.

Under the new initiative agribusiness, energy, manufacturing and service sector companies will be able to access loans in a range of local and foreign currencies.

Under the new program being managed in the region by PTA Bank, companies operating in Kenya, Uganda, Tanzania, Rwanda, Burundi, Ethiopia, Eritrea, Djibouti, Democratic Republic of Congo, Zambia, Seychelles, Malawi, Egypt, Mauritius and Mozambique will be able to access loans up to 15 years in Euro and US dollars or up to seven years in local currency.

Unlike most recent private sector lending by the EIB in the region the new program will not only target small and medium sized enterprises, but also focus on supporting specific investment needs of larger firms.

Pim van Ballekom, European Investment Bank Vice President, said: “The new engagement reflects our strong shared commitment to support private sector enterprise activity in Africa. This new lending program represents the largest ever engagement to support business investment in Africa by the European Investment Bank.”

“This will help firms present in twelve countries to create new jobs and explore new business opportunities in key sectors. It builds on past lending in Africa with other leading local banks and enable support for investment by larger companies for the first time,” he said.

Admassu Tadesse, President of PTA Bank, said: “We are delighted to join forces with the EIB to give a much needed boost to increased investment in the real economies of eastern and southern Africa which is key to job creation and economic transformation. This program is a strong addition to other lending programs we have launched with other funding partners."

The initiative will be supported by a €2m ($2.26m) technical assistance program to strengthen environmental, social and money-laundering assessment skills of PTA staff, and to improve assessment of the economic impact of projects financed through the scheme.

The European Investment Bank is the world’s largest multilateral finance institution and last year provided €1.1bn for investment in sub-Saharan Africa.