FC to invest $3.5bn in subSaharan infrastructure For the first time ever, the World Bank’s private-sector lending arm will invest more than $1bn in infrastructure in Africa in a year – $3.5bn will go to sub-Saharan Africa, mainly in the infrastructure sector, where the IFC plans projects in 30 countries. It raised investment in the region this year from $2.2bn in 2011, with a projection it may hit about $4bn next year. Three energy projects and the Kenya-Uganda railway will receive a total of $600m. Another $100m will go to Kenya’s Equity bank as a loan to expand lending to small and medium enterprises (SMEs). AGRIBUSINES Private equity spurs growth JSE-listed Zeder Investments is committing $46.7m funding into acquiring and expanding an agricultural operating business, Chayton Africa, a long-term investment in the viability of African agribusiness. Chayton Africa made its first investment in Zambia in 2010 and currently produces 10% of the country’s soya and 5% of its wheat. It believes that agricultural trade in Africa will play a larger role in securing the food needs of developing countries, and that foreign direct investment will fill key infrastructure gaps. Earlier this year, the African Agriculture Fund (AAF) SME fund, established to stimulate commercial growth, raised $30m, and is targeting $100m, and Standard Chartered Bank’s Africa Private Equity division acquired a $74m stake in Tanzania-based agribusiness ETG, placing a £500m value on the company. (See also Agriculture Special Report page 28.) MOBILE MONEY Rwanda, Zimbabwe and Kenya expansion Bharti Airtel launched its operation in Rwanda, expanding its footprint on the African continent to 17 countries. It will invest over $100m in its operations over the next three years, generating direct and indirect employment opportunities. Econet Wireless, Zimbabwe’s largest telecoms firm, has passed the 1m mark in ‘connected’ users for its EcoCash mobile money service, which the company says is the fastest growth of such a service in the world. In Kenya, supermarket chain Uchumi, with 18 branches, has become Safaricom’s leading M-Pesa agent by transaction volumes. Equity Bank is second, Kenya Post Office Savings Bank seventh and Naivas (Naivasha Self Service Stores) ninth in the top 10 agents. RENEWABLE ENERGY Kenya hosts SA’s largest wind farm Construction on the €582m Lake Turkana Wind Power project (LTWP) is due to start in June, pending the finalisation of risk guarantees from World Bank institutions IDA and MIGA. The project, backed by the African Development Bank, marks the largest single private investment in Kenya’s history, and should allow the country to diversify from hydroelectric power, which provides around 60% of its electricity needs. Kenya is the first African country to tap geothermal power. LTWP will sell the electricity produced to utility company Kenya Power. The project will create 2,500 jobs during the 32-month construction and 200 permanent jobs.
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PRIVATE EQUITY Nigeria, S Africa set for $280m EU investment Nigeria and South Africa top the list of African countries set to benefit from a proposed $280m private equity investment over five years by the African Venture Capital Association (AVCA), if governments step up efforts to improve the business environment and secure foreign investments. Investors are looking to invest in oil and gas, telecommunications, and real estate sectors. ACVA is a not-for-profit entity which promotes, develops and stimulates private equity and venture capital in Africa, promoting high ethical standards in the private equity and venture capital industries.
COMODITIES Gabon rubber production bounces back Gabon will invest $183m to develop a rubber plantation and processing plant in a partnership with multinational Singapore firm Olam. The joint venture, in which the government will hold a 20% interest, will fund the development of a 28,000-hectare plantation. Planting will start in 2013 and be completed in 2019, with the first harvest in 2020. It is expected to yield 62,000 tonnes of rubber per year. A processing plant of 225 tonnes per day will be built to increase exports to meet a rising global demand in consumption of 3.5% per year. More than 6,000 direct and 5,000 indirect jobs will be created, with Olam providing training. It will construct 3,366 houses, schools and a health centre. The employment zone will meet international standards in terms of Corporate Social Responsibility.
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