UK development finance institution (DFI) British International Investment (BII) has launched under its new name in South Africa and has reaffirmed its commitment to invest to accelerate South Africa’s economic dynamism.

The institution will deploy its patient, long-term capital toward scaling climate finance and expanding the country’s clean energy capacity, increasing investments into economic transforming sectors and backing productive and inclusive opportunities across the country.

BII has a special relationship with South Africa and its ambition is to align its investment strategy to help solve pressing challenges facing the country, including urgently delivering reliable clean energy, says BII CE Nick O’Donohoe.

During 2021, BII’s portfolio in South Africa was valued at more than $142-million. Having significantly scaled its investments into clean energy infrastructure this year, the institution's commitment today stands at more than $520-million.

“These latest investments include BII’s partnership alongside financial services company Standard Bank and [managed renewables investment and development company] H1 Holdings in three Kenhardt projects under South Africa’s Risk Mitigation Independent Power Producer Procurement Programme,” he says.

BII also invested in H1 Holdings, supporting the development of an additional about 2.4 GW of gross renewable capacity in the country.

Further, O’Donohoe highlighted BII’s investment focus on helping to reduce inequality in South Africa. Its recent investment in Lona Foods is increasing productive and inclusive economic opportunities for low-income workers and particularly women.

BII supported black-owned and managed private equity fund Summit Fund, which is investing in underserved areas and BII's commitment to H1 Capital marked its first direct investment in a broad-based black economic empowerment company in South Africa.

The institution says it will continue to partner with key players whose work helps to promote inclusive opportunities and stimulate productive and sustainable growth.

“We are committed to championing the expansion of South African firms into other African markets, to facilitate knowledge sharing and deliver best-in-class technical and operational expertise that will accelerate national and continental prosperity,” he says.

“As we advance through our new strategy period, BII remains determined to leverage our expertise as Africa’s largest climate finance investor to invest in nascent renewable technology and water supply projects and help mobilise more commercial capital to grow South Africa’s economy,” O’Donohoe points out.

BII first invested in South Africa in 1995 when it backed the construction of the 440 km N4 motorway between eMalahleni, in Mpumalanga, and Maputo, in Mozambique.

Currently, its investments in South Africa support more than 49 000 jobs in over 42 businesses and 26 investment funds.

BII’s additional investment activities in South Africa include delivering clean power to South Africa’s grid through Globeleq, which is a BII majority-owned company and one of South Africa’s leading independent renewable energy providers, and through Gridworks, which is a BII-owned electricity transmission and distribution platform.

Further, BII also supports clean power through ACWA Power’s Redstone concentrated solar power project, which is using pioneering energy storage technology to help increase South Africa's renewable energy supply.

Additionally, the UK DFI invested $18.5-million in digital financial services firm TymeBank to support the creation and launch of a new partnership channel and credit products that will increase services to under-served populations.

The institution also backed Liquid Telecom with a $220-million investment in 2019 to improve access to affordable and high-quality Internet and accelerate the company’s Cape-to-Cairo fibre network connection.

BII has partnered with telecommunications company Vodacom Group in the Global Partnership for Ethiopia consortium to improve access to affordable and high-quality Internet in Ethiopia, and expand productivity and social inclusion across the country, the organisation said.

“I am delighted that BII is making such a strong commitment to enhancing their presence and impact in South Africa. I particularly welcome BII’s focus on investments that will help to build South African businesses and create more economic opportunities for people and communities that urgently need them,” says British High Commissioner to South Africa Antony Phillipson.

“This is a vital part of the partnership between South Africa and the UK in key sectors like renewable energy, healthcare and infrastructure. These are critical to helping South Africa achieve its ambitions to create inclusive economic growth, and to deliver a Just Energy Transition through investment in a green, sustainable and job-creating economy,” he emphasises.