Côte d’Ivoire has become the newest member of Africa Finance Corporation (AFC), the leading international finance institution for financing infrastructure projects in Africa.
This announcement comes at a time of stability and strong economic progress for Côte d’Ivoire, whose $1bn Eurobond was well received by investors earlier this year. The Ivorian government has expressed its determination to continue improving the country’s infrastructure in order to support its successful economic development. The construction of the Henri Konan Bedie Bridge, a landmark $365 million public private partnership, was one of the first large-scale infrastructure development projects to be undertaken by President Ouattara’s government following the cessation of civil war in 2011. AFC was the mandated lead arranger for the mezzanine tranche of the financing and provided loan facilities and equity investments amounting to $55 million. The bridge, which provides quick and easy access directly into the heart of Abidjan, has dramatically reduced transportation costs by easing congestion on existing routes, improving the country’s overall connectivity.
Earlier this year AFC signed a joint development agreement with Ivoire Hydro Energy SA (IHE), an Ivorian project company, for the development of the 44MW Singrobo hydroelectric power plant (Singrobo) in Côte d’Ivoire. The new plant will be a much needed addition to the country’s power grid and will accelerate regional integration by tackling West Africa’s energy deficit. AFC has also provided financing to Societe Ivorienne de raffinage (SIR).
Mr. Andrew Alli, Chief Executive Officer of AFC, commented on the announcement: “This is a wonderful opportunity for AFC to expand its portfolio of projects in Côte d’Ivoire and therefore play its part in accelerating the country’s economic development. By signing the Corporation’s Instrument of Accession and Acceptance of membership, Côte d’Ivoire enables AFC to receive preferred creditor status within the country, the benefits of which would reduce our investment risk and allow us to provide more competitive financing solutions. We hope to continue working closely with both public and private organizations within Côte d’Ivoire, building on what we have already achieved to set the standard for future developments.”
AFC, an investment grade multilateral finance institution, was established in 2007 with an equity capital base of US$1 billion, to be the catalyst for private sector infrastructure investment across Africa. With a current balance sheet size of approximately US$2.9 billion, AFC is the second highest investment grade rated multilateral financial institution in Africa with an A3/P2 (Stable outlook) rating from Moody’s Investors Service. In May 2015, AFC successfully concluded a debut US$750 million Eurobond issue which was 7 times oversubscribed and attracted investors from Asia, Europe and the USA.
AFC’s investment approach combines specialist industry expertise with a focus on financial and technical advisory, project structuring, project development and risk capital to address Africa’s infrastructure development needs and drive sustainable economic growth. Investments in high quality infrastructure assets that provide essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport, and telecommunications tops its choice list. It had become the benchmark institution for private sector power project development and investment in Africa.
AFC is committed to proactively financing and managing the development of key infrastructure projects which will have a positive impact on the lives of Africans all over the continent. To date the Corporation has invested over US$2.5 billion in projects across 24 African countries and in a wide range of sectors including power, telecommunications, transport and logistics, natural resources and heavy industries. The other member states include: Cape Verde; Chad; Ghana; Guinea-Bissau; Guinea; Liberia; Nigeria; Sierra-Leone, The Gambia and Gabon.
Ivory Coast or Côte d’Ivoire is a country in West Africa. Its capital is Yamoussoukro, and its biggest city is the port of Abidjan. The country’s population is 23,919,000 in July 2014. The official language is French, with local indigenous languages also widely used, while the main religions are Islam, Christianity (primarily Roman Catholicism), and various indigenous religions. It achieved independence in 1960, led by Félix Houphouët-Boigny, who ruled the country until 1993 and maintained close political and economic association with its West African neighbors while at the same time maintaining close ties to the West, especially France.
Ivory Coast has, for the region, a relatively high income per capita (US$1014.4 in 2013) and plays a key role in transit trade for neighboring, landlocked countries. The country is the largest economy in the West African Economic and Monetary Union, constituting 40% of the monetary union’s total GDP. The country is the world’s largest exporter of cocoa beans, and the fourth-largest exporter of goods, in general, in sub-Saharan Africa (following South Africa, Nigeria, and Angola). In 2009, the cocoa-bean farmers earned $2.53 billion for cocoa exports and were expected to produce 630,000 metric tons in 2013. According to the Hershey Company, the price of cocoa beans is expected to rise dramatically in upcoming years. The Ivory Coast also has 100,000 rubber farmers who earned a total of $105 million in 2012.
The maintenance of close ties to France since independence in 1960, diversification of agriculture for export, and encouragement of foreign investment has been factors in the economic growth of Ivory Coast. In recent years, Ivory Coast has been subject to greater competition and falling prices in the global marketplace for its primary agricultural crops: coffee and cocoa.