OFID’s $54.5 million loan supports SMEs, green energy in West Africa

The Opec Fund for International Development (OFID) has signed a €50 million loan ($54.5 million) with the West African Development Bank (BOAD) to support small and medium-sized enterprises (SMEs) through other financial institutions and for green energy projects.

Sub-loans under the agreement will be available in the member countries of the West African Monetary Union (WAMU): Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo.

Opec Fund Director-General Dr. Abdulhamid Alkhalifa said, “We are pleased to further expand our cooperation with BOAD in line with two strategic priorities of our institutions: providing access to finance for local businesses and promoting green energy solutions to support cheaper, cleaner and reliable sources of electricity generation. We are committed to contributing to growth and sustainable development in the WAMU member countries.”

Serge Ekue, President of BOAD and Chairman of its Board of Directors, said, “I am pleased to sign this new loan agreement with the OPEC Fund. It is one of our key partners which stands by our side for more than four decades, helping us to carry on with our mission as provided under Article 2 of our Articles of Association, which is to promote the balanced development of our member countries and foster economic integration within West Africa, by financing priority development projects for the overall well-being of our populations.”

The OFID and BOAD have been collaborating since 1983 and, to date, have jointly financed 25 public, private and trade finance projects. The Opec Fund has also provided three direct loans to BOAD to support private sector and trade finance projects in the WAMU.

The new financing is aligned with the Opec Fund’s Climate Action Plan, which commits the institution to dedicate 40 per cent of all new financing to climate-related investments by 2030.

The Opec Fund for International Development (OFID) has supported the Green, Inclusive and Sustainable Development programme in Armenia with a 50 million euro loan through its programme lending instrument.

This programme aims to support the government’s developmental efforts to foster climate change mitigation and adaptation, improve environmental management and energy efficiency, enhance equity, promote human capital development and strengthen governance.

The programme was developed with the World Bank, which has provided a parallel loan of 92.3 million euro ($100 million equivalent) for its implementation.

Opec Fund Director-General Dr Abdulhamid Alkhalifa said, “We are pleased to partner with the government of Armenia and the World Bank to support this ambitious programme, investing in human capital development and improving climate change resilience. The programme will support Armenia’s long-term development ambitions and national plans, while helping it to achieve multiple Sustainable Development Goals.”

Armenia’s Green Inclusive and Sustainable Development Programme aligns with the government’s five-year development plan (2021-2026). It includes fundamental steps such as reforming the public investment management framework, reviewing the justice system and relevant environmental legislation, overhauling the social assistance system, and modernising the national curriculum to strengthen science, technology, engineering, and mathematics.

The Opec Fund for International Development (OFID) is supporting the Karenge Drinking Water Supply Expansion Project in Rwanda’s Eastern Province with a loan of $21 million. This funding will help to increase the capacity of the Karenge drinking water plant to 48,000 m3 per day.

Following expansion works in 1985 and 2008, which respectively increased the capacity of the Karenge drinking water treatment plant to 7,200 m3 and 15,000 m3 per day, compared with 3,840 m3 when it was commissioned in 1975, the plant will be expanded again. The Rwandan government now wants to increase this capacity to 48,000 m3 per day to meet the drinking water needs of all the inhabitants of the Rwandan capital, Kigali, and the surrounding areas of the Rwamagana district until 2050.

The $164.3 million project is being co-financed by the Opec Fund for International Development (OFID) through a $21 million loan granted to the Rwandan government on 9 November 2023. Ofid’s Director General, Abdulhamid Alkhalifa, and Rwanda’s Minister of State for Public Investment and Resource Mobilisation, Jeanine Munyeshuli, signed and exchanged initials on the sidelines of the Saudi-Arab-African Economic Conference held in Riyadh, Saudi Arabia, on the same date.

The Opec Fund’s work is people-centered, focusing on projects that meet basic needs - such as food, energy, clean water and sanitation, healthcare and education – with the aim of encouraging self-reliance and inspiring hope for the future.