LAGOS, Nigeria — The Italian development finance institution Cassa Depositi e Prestiti SpA (CDP) has agreed a debut 100 million euro loan for Africa Finance Corporation (AFC), the leading infrastructure solutions provider on the African continent, to facilitate investments in renewable power, energy efficient projects and climate-resilient infrastructure.
CDP, with assets totalling over 400 billion euros, is providing the bilateral loan to support AFC projects that are urgently needed to transform African infrastructure to help combat and adapt to global warming, as well as catalyse industrialisation, create jobs and reduce poverty.
“Building strong partnerships with major international institutions such as Africa Finance Corporation is part of our strategy to scale up impact finance and accelerate the ecological transition in developing countries” affirmed Antonella Baldino, Head of International Cooperation and Development Finance at CDP. “It is in this spirit that we welcomed AFC recent entry into the International Development Finance Club. By intensifying our commitment to Africa, this operation best places CDP as a partner of choice for regional and local Development Finance Institutions.”
The loan agreement supports CDP’s mission to boost economic growth in emerging markets and expand Italy’s global investment footprint and demonstrates continued interest from European investors in high-quality infrastructure projects on the African continent.
“This milestone agreement today marks the start of a mutually beneficial relationship between AFC and CDP – the Italian DFI” said Samaila Zubairu, President & CEO of AFC. “Access to funding from highly rated institutions, like CDP, helps us to further our commitment to investing in projects that simultaneously combat climate change and develop the critical infrastructure required for Africa’s economic growth, while delivering reliably competitive investor returns.”
AFC has invested over $10 billion in projects spanning 35 African countries over 15 years. The Corporation draws capital from a diverse range of international investors and lenders as part of a strategy to maintain its investment grade credit rating of A3 at Moody’s. CDP joins AFC’s pool of funding partners comprising international development finance institutions such as the German Development Bank KfW, the India Exim Bank, and a syndication of Germany’s DEG, Netherland’s FMO and France’s Proparco, demonstrating global investor confidence in AFC’s strong credit profile and strategy to delivering de-risked, transformational projects for Africa.
The focus on sustainably reducing Africa’s energy deficit led to agreement by AFC last month to jointly acquire Lekela Power, the continent’s biggest renewables independent power producer, with plans to double generation capacity within four years. AFC’s approach to balancing the need for emissions reduction in Africa with critical development imperatives is set out in a recently published white paper titled Roadmap to Africa’s COP: A Pragmatic Path to Net Zero. The report received wide endorsement from leaders including Ghana’s President Nana Akufo-Addo, Nigeria’s Vice President Yemi Osinbajo and the Chair of the African Group of Negotiators at COP26, Tanguy Gahouma.