The European Investment Bank (EIB) has made a significant commitment to collaborate with the Africa Finance Corporation (AFC) in establishing a $750 million Infrastructure Climate Resilient Fund. This initiative is designed to bolster climate adaptation efforts across Africa by ensuring that resilience measures are integrated into every phase of infrastructure development, from the initial design and construction stages to ongoing operations.
As part of this strategic partnership, the EIB has pledged to invest $52.48 million into the fund, which is overseen by AFC Capital Partners (ACP), the asset management division of AFC. Notably, ACP has already secured a substantial commitment of $253 million from the Green Climate Fund (GCF), marking it as the GCF’s largest equity investment in Africa to date. Additionally, the fund has garnered support from the Nigeria Sovereign Investment Authority and two private African pension funds, further enhancing its financial backing.
The primary objective of the Infrastructure Climate Resilient Fund is to accelerate climate adaptation initiatives throughout Africa. This will be achieved by embedding resilience strategies into the infrastructure development process, thereby addressing climate-related challenges effectively. The fund employs blended finance mechanisms to mitigate risks associated with private investments and incorporates innovative solutions such as climate risk parametric insurance, which provides enhanced protection against potential climate-related risks and losses.
Furthermore, the fund is committed to offering technical assistance to strengthen the capabilities of countries in conducting climate risk assessments and implementing adaptation strategies. This aligns with the European Union’s Global Gateway initiative and the United Nations Sustainable Development Goals.
EIB Vice-President Ambroise Fayolle emphasized the bank’s dedication to fostering private sector investments in climate-resilient infrastructure, particularly in regions that are most susceptible to the impacts of climate change. He stated, “This partnership with the Africa Finance Corporation and the launch of ACP’s Infrastructure Climate Resilient Fund represent a significant advancement in accelerating Africa’s green and digital transition, ensuring a sustainable future for all. The EIB’s investment is not merely an initial capital infusion; it is designed to create a multiplier effect by attracting additional investors, lowering risks, showcasing successful projects, and promoting best practices in climate finance.”
Samaila Zubairu, President and CEO of AFC, highlighted the critical importance of this fund in addressing the funding gap for climate adaptation in Africa. He remarked, “By concentrating on climate-resilient infrastructure, we are not only safeguarding our economic future but also generating opportunities for sustainable growth and supporting job creation across the continent. We are pleased to partner with the EIB and other investors who are dedicated to amplifying the impact of climate finance.”
Once operational, the Infrastructure Climate Resilient Fund aims to invest in a diverse portfolio of 10 to 12 projects throughout Africa. Additionally, it will provide support to countries and entities in building capacity and deploying effective climate risk assessment and adaptation solutions, thereby contributing to a more resilient and sustainable future for the continent.
