In a significant move set to boost youth entrepreneurship in Liberia, the Government of Liberia and the African Development Bank (AfDB) are poised to officially launch the nation’s first Youth Entrepreneurship Investment Bank (YEIB) on Tuesday, to help tackle youth unemployment in Liberia.
According to a report from AfDB today; “this $17.8 million initiative makes Liberia the first country to host the pan-African financial institution for youth entrepreneurs.” AFDB noted.
The YEIB is the idea of African Development Bank Group President, Dr. Akinwumi Adesina; who aims to unlock the vast potential of Liberia’s young population by providing crucial financial and non-financial support for youth-led micro, small, and medium enterprises (MSMEs).
Meanwhile, the establishment of the YEIB is a direct response to the prevalent challenges faced by young Liberian entrepreneurs, including a fragmented early-stage business development ecosystem and severely limited access to finance.
Historically, financial institutions in Liberia have been hesitant to lend resources to youth-led ventures, often due to perceived high risks, lack of collateral, and the absence of a robust support structure. AfDB noted that; YEIB seeks to address these critical market failures head-on.
“The banks will help establish over 150 youth-led enterprises, create jobs, and unlock more than $500 million in additional lending over the next decade.” AFDB noted.
The initiative, once launched will target youths between the age of 18-35 and address critical youth unemployment. 60% of Liberia’s population are under 35.
AfDB emphasized that; unlike traditional banks, the YEIB will introduce models that are both short and long term investment-friendly and supports strategic risks.
“ YEIB model combines three innovative components: an early-stage investment fund for direct equity investments, a Technical Assistance Fund for business development services, and a Credit Guarantee Fund for risk-sharing mechanisms.”
The YEIB is jointly financed by the African Development Fund (US$15.9M), Korea Africa Economic Cooperation (US$0.7M), and the Government of Liberia (US$1.2M in-kind).
However, Youth Entrepreneurship Investment Banks have earlier been approved in other African countries such as: Liberia, Nigeria, Ethiopia, and Côte d’Ivoire, but launching and operations are yet commence. The launch of YEIB in Liberia on Tuesday, marks the start of a continent-wide drive to boost youth entrepreneurship and access to finance, driven by the African Development Bank Group.
