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IsDB, APICORP ink $1 bln agreement to boost infrastructure in member countries including Egypt
The Arab Petroleum Investments Corporation (APICORP), an energy-focused multilateral development financial institution, and the Islamic Development Bank (IsDB) have established the Infra Initiative, a $1 billion private sector-focused infrastructure financing initiative, according to IsDB.
The initiative’s funds will be utilised to finance strategic utility projects that contribute to human and economic development in the two multilateral financial institutions’ member countries, including Egypt, and their respective national development strategies.
Accordingly, the two institutions will jointly identify and deliver structured finance facilities to utilities projects with limited access to international financing.
Moreover, funds will be dedicated to electricity generation and transmission projects which utilise renewable energy or natural gas, as well as water and waste management facilities.
The involvement of the private sector at the local, regional, and international levels will also be a priority in the project selection process, IsDB said.
The two institutions will address low private sector participation in funding energy projects by incentivising public-private partnerships (PPPs) to bridge the estimated $200 billion investment gap in such projects in the Organization of Islamic Cooperation (OIC) member countries, including Egypt, under the initiative.
Additionally, the initiative aims to mobilise other financing avenues from commercial banks, multilateral development banks, development agencies and capital markets.
“We recognise that quality infrastructure is key to economic and social development. Hence, addressing the infrastructure needs of our member countries is one of IsDB’s foremost priorities. Our cooperation with APICORP on the Infra Initiative is in this spirit. It is intended to amplify our impact by combining our two institutions’ resources, skill sets and market knowledge. It also supports our respective commitments to the Sustainable Development Goals – particularly goals six, seven and nine”, said IsDB’s President Muhammad Al Jasser.
On his side APICORP’s CEO Ahmed Ali Attiga mentioned that increasing private sector investments in the energy sector is a key area of focus for his corporation as part of its strategy to fund the energy transition in the Arab region.
“It is an objective we shared with our partner, IsDB. Indeed, APICORP has significantly raised the size of its financing and investments in pioneering companies and strategic projects which are shaping tomorrow’s energy landscape,” he added.
APICORP’s 2021-2025 MENA Energy Investment Outlook report projected the share of private investments in regional energy projects to hit 27 percent by 2025, a threefold increase, up from the 8.5 percent in the 2020-2024 outlook.
