The Alliance for Green Infrastructure in Africa (AGIA) is set to raise $500m for project preparation and development, which will then be leveraged into a $10bn fund to help African states build climate-resilient infrastructure. The initiative is to focus on impactful projects featuring greater cooperation between governments and private sector actors on a 3-6-year timescale.
Akinwumi Adesina, president of the African Development Bank during the launch event at Cop27, argued that the fund “will not duplicate existing initiatives” but will instead focus on untapped green investments which he says have significant potential.
The AGIA was launched during the crucial global climate conference in Sharm-El-Sheikh, Egypt, to deploy its resources, partnerships, and instruments to green existing brown infrastructure in Africa.
A focus on projects that will be proficient in the continent includes converting heavy fuel oil and diesel plants to gas hybrid to power industries, greening non-power infrastructure such as transport systems using compressed natural gas, capturing flared gas, and converting it into liquified petroleum gas, gas-to-power, and manufacture of fertilizers.
According to Adesina, there are new opportunities for green asset recycling, as well as the development of green hydrogen, and large-scale renewable energy projects such as the $20bn Desert to Power to provide electricity for 11 countries of the Sahel via solar systems.
“We also envisage infrastructure that will support new green industries, especially the development of lithium-ion batteries in Africa, to position Africa to benefit significantly from the electric car market which could be worth $354bn in 2028,” he said.
The need for green investments in Africa is acutely cited by the fact that out of the $623bn of green bonds issued in 2021, Africa accounted for just 0.26%, the lowest share of all regions of the world.
Notably, Africa also accounted for just 1.9% of all green loans in 2021, and 1% of global issuances of sustainability bonds and sustainability-linked loans and bonds, according to the AfDB.
An emphasis was made by Tshepidi Moremong, chief operating officer of Africa50, who said that the immediate focus is to “create a vehicle which develops bankable green and climate resilient infrastructure projects for Africa”.
