IFC invests in Addax Energy to support fuel imports, economic activity in West Africa
To support imports of crucial energy products into several West African countries, IFC has invested in two trade finance facilities arranged by Société Générale for Addax Energy S.A.
IFC's $20 million investment in a $230 million facility will help Addax finance imports of refined petroleum products into Benin, Côte d'Ivoire, Senegal, and Sierra Leone and distribute the products in Burkina Faso, the Gambia, Guinea, Mali, and Niger.
An IFC investment of $40 million in a second facility also arranged by Société Générale for Addax, will finance the entirety of Mauritania's imports of fuel and transport petroleum in 2021 and 2022. Addax is the trading arms of Oryx Energies SA, one of Africa's largest independent providers of oil and gas products and services.
Disruptions in global trade finance caused by the COVID-19 pandemic are hampering the efficient and timely delivery of petroleum and other energy products. Increasing access to finance for stakeholders in the energy value chain is, therefore, critical to helping meet the acute energy needs of businesses and consumers in Africa and elsewhere.
"We are delighted and proud of IFC's trust and growing support," said Stephen Paris, Chief Financial Officer, Oryx Energies SA. "Our West Africa and Mauritania facilities are pivotal in ensuring a competitive and regular supply of essential energy and fuel products to our traditional and new markets in West Africa. Thanks to the strong support of our banking partners, these facilities have prevented any disruption in the energy supply chain due to COVID-19 and supported the resilience of West African economies during challenging times."
"Economic activity relies on a steady supply of energy and IFC's support for these two trade finance facilities will allow businesses and consumers in West Africa to access fuel when they need it. These investments are also timely as the region begins to recover from the severe economic impacts of the COVID-19 pandemic," said Aliou Maiga, IFC Regional Director for West and Central Africa.
The Mauritania investment is an extension of an initial $35 million funding that was provided last year as part of IFC's $8 billion COVID-19 fast-track financing support package, designed to help client companies and the thousands of smaller businesses they support, weather COVID-19-related disruptions.
IFC's financing also underscores the World Bank Group's strategy to expand support for the Sahel region, which has been hit hard by COVID-19 disruptions.