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Dear Finnfund Community,
Clearly 2025 has been yet another year marked by economic shocks. This time, the shock has been largely driven by a massive shift in US trade policy, which has created unprecedented policy uncertainty across Finnfund’s key markets. We have been working hard to understand the magnitude and implications of the new tariffs on our markets.
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In the short term, the global economy has shown more resilience than initially expected. Global growth has been supported by countries rushing to export to the US before the new, higher tariffs take effect. A weaker US dollar and fiscal expansion in major economies have also helped.
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Moreover, financial conditions have improved since the initial shock earlier this year. US equity markets have rebounded, and the US dollar has weakened, which has helped many emerging economies by easing inflation and supporting their currencies. On the other hand, dampening growth outlooks, depressed investment demand, market disruptions from tariffs and tariff diversion are already clearly visible in our markets.
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We are still living in the early days of understanding the implications of changing trade policies and global economic relations. The future of high trade barriers and continued uncertainty certainly will dampen growth and increase downside risks. However, this will not likely shift global growth drivers in the medium term. We expect that emerging and developing Asia will continue as the engine for global growth in the 2020’s and Sub-Saharan Africa will keep its place as the second fastest growing region in the world.
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At Finnfund, we remain committed to our investment mandate of supporting emerging and developing markets through impactful investments, focusing on sustainable development and responsible business practices. At the same time, we continue vigorous monitoring of our markets to fully understand the country and sector-level implications of the new era of global economic policies.
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Thank you for your continued support and engagement.
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Kristiina Karjanlahti
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P.S. We hope you find this quarterly newsletter useful. Should you wish to receive this newsletter in the future, but have not yet joined our subscribers, please click here. You can unsubscribe at any time.
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Investment decisions and disbursements in Q2/2025
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CFO Insights into Q2 2025
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“In the first half of 2025, Finnfund focused on executing its new strategy, including capital raising and the launch of a new fund. We made 12 new investment decisions totalling EUR 63 million. The portfolio value stood at EUR 744 million, down EUR 34 million from year-end 2024," says Finnfund's Chief Financial Officer Olli Sinnemaa. Read more
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Finnfund announces successful first closing of Finnfund Digital Access Impact Fund I LP
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Finnfund, a Finnish development financier and impact investor, announces the first closing of Finnfund Digital Access Impact Fund I LP (DAIF), marking a significant milestone in mobilising private capital for impactful investments in emerging markets. The fund has raised EUR 80 million and is focused on digital infrastructure and solutions, aiming to bridge the digital divide and promote digital, financial and gender inclusion in underserved regions in Africa, Asia and Latin America. Read more
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Wave raises EUR 117 million to accelerate financial inclusion across the African continent
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Wave Mobile Money, Africa’s fastest-growing mobile money platform, has raised EUR 117 million in debt financing to advance its mission of making affordable, user-centric financial services accessible to everyone. The financing was led by Rand Merchant Bank (RMB) and a consortium of global development finance institutions, including British International Investment (BII), Finnfund and Norfund.
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Finnfund’s economist Tangeni Shatiwa: “Investor confidence in Nigeria got a boost”
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The current government of Nigeria has implemented a series of bold policy reforms to address structural weaknesses of the country. The reforms have provided a boost to growth in the country thus far and have put Nigeria back on the path towards reaching macroeconomic stability over the next few years. Finnfund sees many positive signs in sight. Read more
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Finnfund closed a 4 million US dollar debt investment with Kenyan Poa Internet to expand affordable broadband
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Finnfund closed a USD 4 million debt investment with Poa Internet Kenya Ltd., a Kenyan internet service provider, to expand its network and improve internet accessibility. The investment aims to support Poa Internet in bridging the digital divide by providing affordable broadband internet to underserved communities in Kenya. Read more
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Finnfund Insights explores current issues in emerging and developing markets. The latest issue published in September focuses on Nigeria.
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“Because of its size and growth potential, Nigeria has become one of Finnfund’s most important markets. However, the country has undergone a severe macroeconomic crisis in recent years, which has created a challenging environment for businesses. We recently visited Nigeria to better understand how the country is addressing these challenges and assess prospects for businesses moving ahead. This report is based on several meetings and interviews conducted during our trip,” says Tangeni Shatiwa, Finnfund´s Economist.
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Would you like to know more?
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Finnfund is a Finnish development financier and impact investor. Finnfund builds a sustainable future and generates lasting impact by investing in businesses that solve global development challenges with Finnish added value. Each year, we invest 200–250 million euros in 20–30 companies in developing countries. Our focus is particularly on digital infrastructure and solutions, clean energy, forestry, agriculture, and on providing funding for small and medium-sized enterprises through financial institutions. Today, Finnfund’s investments, commitments, and investment decisions total about 1.3 billion euros. The company has about 100 employees based in Helsinki and Nairobi. For more information, please visit www.finnfund.fi
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