With the need for private sector funding and participation in climate mitigation in Africa prolifically rising, international investment enterprises are also going out of their way to help the country accelerate its energy transition and also to bring the countries in the region out of the economic instability evoked by coronavirus.
In one such instance, the African Development Bank (AfDB) and the European Bank for Reconstruction and Development (EBRD), have come together to ensure increased participation of the private sector in implementation and financing of sustainable projects.
Following the issuance of $114 million package for the development and advancement of Egypt’s largest solar projects in April this year, the EBRD and AfDB are collaborating to boost, source and offer new funding to help alleviate the $2.5 trillion annual financing gap for development in the African continent.
Reports suggest that the companies, through this strategic partnership, would now be able to leverage their experience in global as well as regional financing to empower private sector funding in climate change mitigation, resilient, and green infrastructure.
Moreover, the loans are reported to be directed towards the funding of renewable energy projects and developments in line with other carbon emissions reduction measures and initiatives.
Commenting on the recent partnership, President of the AfDB, Dr. Akinwumi A. Adesina stated that the new pact between the two companies would potentially pave way for AfDB to do more together, particularly in supporting the growth of continent’s private sector.
Dr. Akinwumi added that the impact of COVID-19 on government resources is huge and the continent needs to mobilize more private resources to help the countries in the region build back stronger.
One the other hand, Jason Quinn, Absa interim group CE mentioned that Africa’s green transition calls in for considerable mobilization of funds. Furthermore, the agreement with IFC strengthens its funding available for green projects and also bolsters its position as a leader in funding renewable projects in South Africa.