IFC provides Airtel Africa $194 million in local currency loans
IFC said its digital strategy in Africa aims to enable ubiquitous, reliable, and affordable connectivity.
International Finance Corporation (IFC), on Tuesday, announced a loan to Airtel Africa to help connect millions of new subscribers to mobile internet in six African countries. IFC said the loan will support universal and affordable broadband access in Africa and the opportunities that come with increased connectivity.
IFC will provide six of Airtel Africa’s subsidiaries with local currency loans totaling $194 million. The new financing facility is in line with Airtel’s Africa strategy to increase debt within its operating companies, IFC said in a statement shared with Financial Nigeria.
According to data from GSMA, less than half of sub-Saharan Africa’s population had access to mobile services at the end of 2021, while only 28 percent of the population had access to mobile internet. GSMA also estimates that by 2025, the value added by mobile technology and services is expected to reach almost $155 billion annually.
The financing facility has a tenor of eight years and will be used to support Airtel Africa’s operations and investments in Democratic Republic of Congo, Kenya, Madagascar, Niger, Republic of Congo, and Zambia, where the banking landscape and access to local funding remains largely underdeveloped.
IFC’s loan is supported by co-financing from institutional investors through IFC's Managed Co-Lending Portfolio Program (MCPP). IFC’s loan in Zambia is supported by the Local Currency Facility of the International Development Association’s (IDA) Private Sector Window.
“I am very excited to announce the signing of this new facility with IFC,” said Segun Ogunsanya, Airtel Africa CEO. “Not only does this facility align with our focus on improving our balance sheet through localising debt within our operating companies, but it also supports our commitment and our ability to meet very strict ESG criteria in demonstration of the continued execution of our sustainability journey. I look forward to working closely with IFC in the coming years and to exploring further opportunities to cooperate together to support the economies and communities where we operate.”
Sérgio Pimenta, IFC Vice President for Africa, said the COVID-19 pandemic has made mobile connectivity even more urgent for both social and economic development, adding that helping more people connect to affordable and fast internet networks is a priority for IFC in Africa, especially in the continent’s lower-income countries.
IFC said its digital strategy in Africa aims to enable ubiquitous, reliable, and affordable connectivity. This includes investing in the growth of independent tower operators, data centers and broadband, as well as supporting mobile operators primarily in fragile and conflict situations (FCS) and Low-income International Development Association countries (LIC-IDA).
As part of IFC’s loan facility, Airtel Africa has committed to comply with the applicable requirements of IFC's Performance Standards on Social and Environmental Sustainability and has put in place a dedicated Environmental and Social Action plan. This will further strengthen the company’s commitment to transforming lives across the communities in which Airtel operates and will provide clarity on how Airtel can help address inequality and support economic growth across Africa.
IFC – a member of the World Bank Group – is the largest global development institution focused on the private sector in emerging markets. It works in more than 100 countries, using its capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries.
Airtel Africa is a leading provider of telecommunications and mobile money services, with a presence in 14 countries in Africa, primarily in East Africa and Central and West Africa.
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