IFC Announces $20M Equity Investment in the Africa50 Fund to Facilitate Sustainable Infrastructure Development in Africa
IFC has announced a $20 million equity investment in the Africa50 Infrastructure Acceleration Fund (IAF Fund), which will fund projects related to digital infrastructure, renewable energy and power, transportation, logistics, and water and sanitation. The goal of the IAF Fund is to support sustainable infrastructure development throughout Africa.
The fund seeks to engage in initiatives throughout Africa where infrastructure development is being significantly aided by the private sector. The fund’s emphasis on the energy and digital infrastructure sectors is in line with the IFC’s approach to supporting projects with a high development effect as well as a number of World Bank Group programs.
$222.5 million in commitments were made for the fund during its initial closure, including from 16 institutional investors in Africa. The ultimate goal closing for the fund is $500 million.
Alain Ebobissé, CEO of Africa50 Group, said, “We are delighted to see such strong support from African institutional investors for the Africa50 Infrastructure Acceleration Fund.” This accomplishment demonstrates the growing contribution that African institutional investors are making to supporting the continent’s real economy and realizing its full potential. The Africa50 Group intends to generate additional private sector funds from Africa and throughout the world to invest in African infrastructure, with the Africa50-IAF being the first of a series of new investment instruments.
“Investing in infrastructure is essential for Africa’s social and economic development. This partnership with IAF will help promote and mobilize much needed equity capital for projects that will have direct positive impacts on populations across Africa, including those that focus on climate mitigation,” said Sarvesh Suri, IFC Regional Industry Director for Infrastructure and Natural Resources, Africa.
Africa is today confronted with serious infrastructure problems. Africa’s Pulse, a biannual World Bank publication, claims that the lack of access to most forms of infrastructure, such as electricity, digital, roads, and water, has an effect on economic activity on the continent.
It is anticipated that IFC’s involvement in IAF will aid in attracting more private funding for the fund. This entails securing backing from local and regional banks, development finance organizations, and institutional investors.
