AfDB issues its first “Light Up and Power Africa” theme Bond
The African Development Bank (AfDB) has issued the first “Light Up and Power Africa” Bond for $90million sold to the Dai-ichi Life Insurance Company, Limited, the sole investor in the transaction.
The “Light Up and Power Africa” Bond supports AfDB’s ambition to achieve an important goal of realizing Africa’s energy potential and bridging the continent’s energy deficit.
Over 645 million Africans have no access to energy. The electricity access rate for African countries is just over 40 percent, the lowest in the world. This undermines efforts to lift Africans out of poverty.
Access to energy is crucial for the attainment of health and education outcomes, reducing the cost of doing business, unlocking economic potential, and creating jobs. Over 90% of Africa’s primary schools lack electricity while 600,000 Africans die each year due to a lack of clean cooking energy. Insufficient energy access handicaps the operations of hospitals and emergency services; compromises educational attainment; and drives up the cost of doing business.
Energy access for all is therefore one of the key drivers of inclusive growth as it creates opportunities for women, youth, and children in urban and rural areas. The aspirational goal of this priority area is to help the continent achieve universal electricity access by 2025 with a strong focus on encouraging clean and renewable energy solutions.
This will require generating 160 GW of new capacity, 130 million new on-grid connections, 75 million new off-grid connections and providing 150 million households with access to clean cooking solutions.
As part of this effort, “Kenya's Last Mile Connectivity Program II", an energy project that provides access to electricity in Kenya, aims to provide electricity to 1.5 million people mainly from low-income groups and micro-enterprises that improve living standards and support economic growth.
Hassatou N’Sele, Acting Vice President, Finance and Treasurer of the AfDB Group, says - “Our mission is the sustainable development of Africa and our core priorities are the High 5’s: “Light Up and Power Africa”; “Feed Africa”; “Industrialize Africa”; “Integrate Africa” and “Improve the Quality of Life for the People of Africa”.
We would like to thank Dai-ichi Life for their interest and investment in “Light up and Power Africa” Bond. Their role in this transaction is helping towards our goal of attaining universal electricity access by 2025, with a strong focus on encouraging clean and renewable energy solutions.”
The AfDB will use its best efforts to direct an amount equal to the net proceeds of the issue of the Notes to lending projects within the strategic “Light Up & Power Africa” priority, subject to and in accordance with the AfDB’s lending standards.
The proceeds of the Notes will be included in the ordinary capital resources of the AfDB and will be used for the general operations of the Issuer in accordance with the Agreement Establishing the African Development Bank.
The Bond was offered to Dai-ichi Life in a private placement format with Deutsche Bank AG as the sole arranger of the bond.