The Republic of Zimbabwe has become the nineteenth member state of the Africa Finance Corporation (AFC), Africa’s leading infrastructure development finance institution.
Referencing infrastructure development as being amongst the top of his agenda, His Excellency President Emmerson Mnangagwa declared Zimbabwe “open for business”. As such, the AFC has already begun the process of exploring, alongside the Infrastructure Development Bank of Zimbabwe (IDBZ), opportunities for investment. The IDBZ has a national mandate to champion infrastructure development in Zimbabwe in the key sectors of energy, transport, housing, ICT, water and sanitation. Recently, the Bank was designated by Government of Zimbabwe to be the focal and national implementing entity for Green Climate Finance and is currently undergoing accreditation to GCF; a development which makes the IDBZ an ideal partner for the AFC’s entry into the Zimbabwean market. Zimbabwe’s membership in the AFC will significantly enhance the Bank’s resource mobilisation efforts towards funding the country’s huge infrastructure needs.
Against this background, Zimbabwe’s Minister of Finance and Economic Development has signed the Instrument of Adherence to the Member of Africa Finance Corporation on 09 May 2018.
In 2018 alone, AFC has already marked some major milestones in the diversification of its membership and shareholding; with the African Reinsurance Corporation and the Republic of Malawi joining the Corporation in February and March, respectively. Zimbabwe’s membership of AFC is a welcome development for both the country and the Corporation.
Andrew Alli, President and CEO of AFC, commented on the announcement: “We are pleased to welcome Zimbabwe as a member state of AFC. We view the ongoing political and economic renaissance positively and hope that we can contribute effectively to the revitalization of infrastructure within the country”.
Patrick Chinamasa, Zimbabwe’s Minister of Finance and Economic Development, commented on the announcement: “AFC’s business model has proven that the African continent can effectively mobilise infrastructure financing by itself. We enjoin other African States to join the Corporation, promulgating home-grown solutions to our infrastructure challenges”.
The Minister of Foreign Affairs of Zimbabwe, Sibusiso Moyo also commented as follows: “It is refreshing to see an African focused financing institution like AFC. We look forward to AFC leading the infrastructure and industrial renaissance of Zimbabwe in particular, and Africa in general”.
Thomas Zondo Sakala, Chief Executive Officer of IDBZ added: “We look forward to working closely with the AFC, particularly in the areas of project development, capacity building, and infrastructure delivery”.
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-led infrastructure investment across Africa. With a current balance sheet size of approximately US$4.2 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. AFC successfully raised US$750 million in 2015 and US$500 million in 2017; out of its Board-approved US$3 Billion Global Medium- Term Note (MTN) Programme. Both Eurobond issues were 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. AFC invests in high quality infrastructure assets that provide essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport, and telecommunications. To date, the Corporation has invested approximately US$4 billion in projects within 28 countries across North, East, West and Southern Africa.