For Marie-Paule Effagon, a 48-year-old teacher living in Yaoundé, Cameroon, two-day power outages — which are not uncommon — wreak havoc on her family’s routine. Yet Effagon is considered lucky: nearly 40 percent of Cameroon’s citizens have no access to electricity at all. To improve lives and long-term economic prospects, IFC and the World Bank are helping to finance the Nachtigal Hydropower Plant, a privately owned and operated 420-megawatt power plant. It will increase the country’s installed power capacity by nearly one-third and bring clean, affordable power to millions when it begins operations in 2023.
Our early engagement helped confirm Nachtigal’s technical, financial, and environmental feasibility and address bureaucratic bottlenecks. Key project development and structuring support came from across the World Bank Group. IFC is directly investing €60 million in equity, lending up to €110 million for our own account, and mobilizing another €806 million from a global syndicate, including four commercial banks and 10 other development finance institutions. We also provided interest rate swaps to help mitigate interest rate risk. Through the development of inclusive community engagement strategies with Nachtigal, IFC is helping create tangible benefits to surrounding communities and identifying ways of mitigating gender-based violence risks.
The Nachtigal project — IFC’s largest power investment on the continent — illustrates our “upstream” work and proactive approach to development across Sub-Saharan Africa, home to almost half of all people who live in extreme poverty. In FY19, our long-term investments in the region totaled $4.1 billion, including nearly $2.3 billion mobilized from other investors.
We often seek out companies that use technology and innovation to unlock sustainable development in the region. With support from the Private Sector Window of the Global Agriculture and Food Security Program, IFC co-led the financing of $10.3 million to help Kenyan start-up Twiga Foods to expand operations and to connect more than 13,000 rural, smallholder farmers to urban vendors. The firm’s platform uses mobile-phone technology to coordinate supply and demand and to pay farmers within 24 hours. IFC is also advising Twiga Foods on aligning food safety practices with global standards and ensuring the traceability of produce.
In Nigeria, we led a $6 million equity investment in Kobo360, a tech-enabled e-logistics platform that connects truckers to transportation services seeking cargo haulers. The investment will help the company reduce costs and increase access to logistics services for small and medium enterprises (SMEs), including those in underserved regions. It will also enable faster payment schedules as well as new financing and savings programs for truck owners and drivers.
With support from the IDA Private Sector Window, IFC is also providing a multicurrency facility of $21.1 million equivalent to Baobab Group, a leading global microfinance network. Support extends to Baobab’s affiliates in Burkina Faso, Côte d’Ivoire, Democratic Republic of Congo, Madagascar, Nigeria, and Senegal. Baobab, a long-time IFC client, is a pioneer in digital financial services across the continent. It is known for helping entrepreneurs access credit even though they often lack the required collateral or credit history. It expects to provide credit to even more entrepreneurs and people with limited access to banking services.