Infrastructure solutions provider, Africa Finance Corporation (AFC) has closed a €150 million 10-year Loan facility with European development finance institutions DEG – Deutsche Investitions-und Entwicklungsgesellschaft mbH and Proparco.
DEG, a subsidiary of Germany’s state-owned KfW Group, has provided financing, advice and support to enterprises in developing and emerging-market countries since its inception in 1962. The transaction builds on a partnership with Africa Finance Corporation that began in 2012 and has resulted in several loans from DEG, including a recent $170 million 12-year loan in 2021.
Petra Kotte, Head of Banking and German Business, highlighted the strategic partnership with Africa Finance Corporation:
“DEG is very happy to have arranged this facility with our long-standing partner Proparco and thus cementing our excellent relationship with Africa’s leading infrastructure financier AFC. The facility contributes to closing Africa’s infrastructure gap, positively impacting on the livelihood of surrounding communities, and supporting AFC in their endeavour to reduce the continent’s footprint as part of their dedicated climate resilience strategy.”
Proparco, the private sector financing arm of Agence Française de Développement Group (AFD Group), has been promoting sustainable economic, social and environmental development by providing funding and support to businesses and financial institutions in Africa, Asia, Latin America and the Middle East for over 45 years.
Its action focuses on key development sectors including infrastructure, mainly for renewable energies, as well as agribusiness, financial institutions, health and education. Proparco provided Africa Finance Corporation in 2021 with a $50m senior credit line in the $170 million syndicated loan led by DEG.
Emmanuelle RIEDEL DROUIN, Global Head – Lending Operations, said: “Proparco is very happy to be participating in this transaction arranged by DEG for the benefit of AFC, a key player in financing much-needed infrastructure in Africa, which remains one of the continent’s main challenges, notably in terms of access to clean energy and transport. AFC is also a member of the International Development Finance Club, chaired by AFD since 2017, and we commend its strong commitment to supporting climate resilient infrastructure and to accelerating the just transition in Africa, as evidenced during the COP27.”
The new credit facility supports the development and implementation of infrastructure projects that enhance the continent’s economic, environmental, or social impact under AFC’s Establishment Agreement and Charter.
“Our strategic partnership with DEG and Proparco mobilises urgently needed capital to rebuild Africa with more resilient and sustainable infrastructure across critical sectors,” said Banji Fehintola, Senior Director, Head of Treasury & Financial Institutions at AFC.
“As part of AFC’s strategy to catalyse infrastructure financing and impact development in Africa, the Corporation draws capital from a diverse range of international investors and lenders. We appreciate the confidence that DEG and Proparco continue to demonstrate in us as a strategic partner and infrastructure solutions provider.”