NEW YORK—The Open Society Foundations are investing $10 million in the Cepheus Capital Growth Fund focused on supporting business development in Ethiopia, as part of its broader commitment to support Ethiopia’s democratic and economic development.
The Soros Economic Development Fund, Open Society’s impact investing arm, will join several leading regional and national development funds as limited partners in a $100 million investment fund launched by Cepheus Growth Capital Partners.
The Soros Economic Development Fund’s investment is principally aimed at creating quality jobs particularly for young people and women in Ethiopia, including in less developed regions, in support of the government’s efforts to reduce the country’s poverty rate.
Cepheus was established in 2016 by its Ethiopian-born managing partners Berhane Demisse and Kassahun Kebede. The fund will provide much-needed foreign capital to private businesses in Ethiopia. Its target investment areas will include manufacturing, agro-processing, and businesses providing services such as education and health care. The fund has set a target of 30 percent for investment in women-owned businesses.
Jocelyn Songco, investment principal at the Soros Economic Development Fund, said: “Despite the positive political and economic changes underway in Ethiopia, the country is still viewed by many private international investment institutions as a challenge, making it hard for local companies to get the capital they need for growth. We have great confidence in the experienced local team at Cepheus, and believe this fund can play an important role in catalyzing greater investment from abroad in the years ahead while creating impact.”
Other investors in the Cepheus Capital Growth Fund include the CDC Group, European Investment Bank, International Finance Corporation, and Norfund.
In addition, in December 2018, Patrick Gaspard, president of the Open Society Foundations met Ethiopia’s prime minister Abiy Ahmed and offered the Foundations’ support for the government’s democratization objectives, particularly in the areas of justice sector reform and strengthening institutions.
The Soros Economic Development Fund was established in 1997 by Open Society’s founder, George Soros. It makes impact investments in sectors including agriculture, financial services, affordable housing, and health care, aimed at creating economic opportunities for those who face systemic discrimination or exclusion, with the purpose of supporting the Foundations’ core mission of promoting open, inclusive, and democratic societies across the world.