Alliance for Green Infrastructure in Africa Project Development fund secures $10m investment from AfDB
On January 24, 2024, the Board of Directors of the African Development Bank Group (www.AfDB.org) approved a proposal to invest up to $10 million in the “Alliance for Green Infrastructure in Africa – Project Development” (AGIA-PD) fund in Abidjan. This fund is part of the larger Alliance for Green Infrastructure in Africa (AGIA), a $10 billion initiative led by the Bank in collaboration with the African Union Commission, Africa50, and other partners.
The AGIA-PD aims to support the continent’s green transition by working with African countries and the private sector to quickly and effectively develop resilient and transformative green infrastructure projects. The implementation of AGIA will be carried out through three pillars: project preparation, project development, and investment and finance. The AGIA-PD fund will operate for 15 years and is expected to reach its capitalization target within three years. It has a blended capital structure, combining donations and treasury stocks, with a total of $400 million.
As of December 2023, commitments totaling $175 million were announced, including a potential contribution of $40 million from the African Development Bank. The Board of Directors has already approved a commercial investment of $10 million, bringing the current total to approximately $215 million.
The AGIA-PD aims to attract a diverse range of investors, including multilateral development banks, impact funds, governmental organizations, sovereign funds, regional and non-regional institutional investors, commercial investors, and philanthropists. This strategic investment, co-managed by the Bank, is designed to efficiently and rapidly transform green infrastructure concepts into viable projects on a large scale. Its primary objective is to generate financial returns while also making a positive impact on development.
To achieve this, the AGIA-PD will collaborate with the private sector to develop transformative, resilient, and environmentally friendly projects that address Africa’s infrastructure gap in the long term. Solomon Quaynor, Vice President of the African Development Bank Group, emphasized the importance of this initiative in driving Africa’s green transition and bridging the infrastructure deficit. Similarly, Amadou Hott, special envoy to the President of the African Development Bank Group, highlighted the AGIA’s vision of establishing a strong partnership among various stakeholders to accelerate the deployment of green infrastructure projects and address the continent’s infrastructure shortage.
The AGIA-PD’s target sectors and investments in climate change mitigation projects align with the nationally determined contributions of beneficiary countries and the Bank’s strategic priorities, known as the High 5s. These priorities include initiatives to provide reliable electricity, enhance agricultural productivity, promote industrialization, foster regional integration, and improve the quality of life for the people of Africa. Furthermore, the AGIA-PD aligns with the Bank’s Climate Change and Green Growth Strategic Framework for the period 2021-2030.
