AfDB Invests $30M in AFC’s Green Shares to Drive Climate Action in Africa

Transformative Partnership to Fund Renewable Energy Projects, Build Climate Resilience, and Bridge Infrastructure Financing Gaps

The African Development Bank (AfDB) has approved a $30 million equity investment in the Africa Finance Corporation’s (AFC) innovative Green Shares initiative, marking a milestone in sustainable financing to combat Africa’s pressing climate challenges. The approval, granted on December 11, 2024, aims to bolster resources for high-impact climate action projects across the continent.

The Green Shares initiative is designed to mobilize both equity and debt funding to support a pipeline of transformative projects, including:

Wind and solar power installations in Djibouti and Egypt.

Energy storage systems in Cabo Verde to support renewable energy use.

AFC will leverage the African Development Bank’s investment to attract further funding from capital markets, creating a multiplier effect that amplifies its impact.

Africa’s Climate Imperative

Africa contributes less than 3% of global carbon emissions but faces some of the world’s most severe climate impacts. The continent also faces an annual infrastructure financing gap of $170 billion. Through this investment, the AfDB and AFC aim to build a robust ecosystem of sustainable financing to bridge these gaps, driving economic opportunities while enhancing Africa’s climate resilience.

Strategic Vision for Green Growth

Solomon Quaynor, AfDB Vice President for Private Sector, Infrastructure, and Industrialization, emphasized the initiative’s transformative potential: “By being the first mover in AFC’s Green Shares, the Bank sends a clear signal to global investors that Africa is not only ready but determined to lead the charge for green growth. This partnership represents the power of strategic collaboration in unlocking capital and advancing the continent’s green transition.”

Banji Fehintola, AFC Executive Board Member, echoed the sentiment, noting the critical role of sustainable financing: “The AfDB’s $30 million commitment reinforces our shared vision of a sustainable and prosperous Africa. Together, we aim to drive impactful solutions that support Africa’s green energy transition while addressing its infrastructure and climate challenges.”

Key Milestones and Projected Impact

Ahmed Attout, AfDB Director for Financial Sector Development, highlighted the initiative’s role in channeling both domestic and international capital into climate resilience projects: “This partnership represents a significant step toward fostering inclusive and sustainable growth in Africa. By prioritizing green infrastructure, we can power millions of households, promote regional integration, and empower marginalized communities, including women and rural populations.”

The investment is projected to generate significant socio-economic benefits, including:

• Creation of over 1,600 full-time jobs by 2031.
• Expansion of clean, reliable energy access for millions of African households.
• Promotion of inclusive economic growth and opportunities for underserved communities.

Building Momentum for Climate Action

The Green Shares program is expected to attract additional regional and global investors, positioning AFC as a key player in Africa’s sustainable financing ecosystem. By channeling resources into renewable energy, infrastructure, and climate adaptation projects, the partnership exemplifies the growing potential for Africa to lead global efforts in addressing the climate crisis.

With its focus on fostering resilience and inclusive growth, the AfDB and AFC collaboration is set to transform Africa’s energy landscape, creating a sustainable foundation for the continent’s long-term development.