AfDB launches African infrastructure finance report
The African Development Bank (AfDB) on Friday launched its 'Structured Finance – Conditions for infrastructure project bonds in African markets' report at the International Monetary Fund–World Bank Spring Meetings in the US.
The report explored how structured finance techniques could mobilise African domestic capital to support economic infrastructure projects and economic growth. It also highlighted the opportunity for project bonds, while outlining the conditions for efficient capital markets.
The AfDB added that the report explains the crucial role of constructive government policies and draws lessons from other markets that might be useful for Africa.
“The release of this new report comes at a very opportune time. African countries have been growing at rates in excess of 5%. Indeed, seven out of the ten fastest-growing countries in the last few years are in Africa. This has created a growing middle class and a flourishing financial sector. Savings are accumulating with institutional investors such as pension funds and insurance companies,” the AfDB said in a statement.
This afforded Africa the financial resources to play a significant role in building the continent’s infrastructure, especially since domestic capital markets were growing in several countries. Domestic government bond markets were also well established and becoming increasingly sophisticated, with nongovernment issuers actively raising funds in many markets.
The AfDB further stated that an opportunity existed for further innovation and that this would be welcomed by the market.
“Several African countries today have given priority to the issuance of ‘infrastructure bonds’. Many countries have been attracted by the example of Kenya, which has launched infrastructure bonds, both from the central government and from State-owned enterprises such as KenGen. The government of Kenya has led the way by introducing certain tax advantages for investors buying such bonds. This has helped to build interest in the institutional sector,” the AfDB said.
Further, the report also elaborates on examples from other emerging markets such as Chile, Brazil, Peru and Malaysia using project bonds as a way to catalyse investors’ interest in infrastructure projects. This can serve as a template for African countries on how to develop their own markets.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation