Rome, August 7, 2024 — In a groundbreaking move to combat climate change, Italy’s Climate Fund and the West African Development Bank (BOAD) have signed a landmark agreement to finance renewable energy projects in eight West African countries. This €100 million initiative, facilitated through a pioneering hybrid bond, marks the first of its kind issued by a multilateral bank for such an exclusive purpose.
The agreement, signed today at Cassa Depositi e Prestiti (CDP) headquarters, signifies a major commitment to sustainable development in the West African Economic and Monetary Union (WAEMU) countries: Benin, Burkina Faso, Côte d’Ivoire, Niger, Senegal, Togo, Mali, and Guinea-Bissau. The funds will be used to develop and rehabilitate infrastructure for renewable energy production, aiming to diversify the energy mix, reduce CO2 emissions, and cut energy costs.
“This Sustainable Hybrid Private Placement, issued in line with our Sustainability Framework, will help BOAD to strengthen its capital structure and reinforce its rating profile,” said Serge Ekue, President of BOAD. “It demonstrates our commitment to advancing economic growth and sustainable development through innovative financing solutions.”
The hybrid bond subscribed by the Italian Climate Fund is part of a broader effort to mobilize climate finance and is aligned with the G20 recommendations on enhancing multilateral development banks’ investment capacities. This bond issuance follows a similar move by the African Development Bank in January 2024.
Italy’s commitment to climate finance is embodied in its Climate Fund, which has an allocation of €4.2 billion for financing projects that meet climate and environmental goals globally. “The Italian government’s support for impactful investments in Africa is in line with the objectives of the Mattei Plan,” stated Gilberto Pichetto Fratin, Italian Minister of Environment and Energy Security. “This innovative financial solution underscores Italy’s new approach to international cooperation, supporting sustainable economic growth and green energy initiatives.”
Edmondo Cirielli, Deputy Minister of Foreign Affairs and International Cooperation, highlighted the significance of the agreement: “This initiative realizes the vision of the Mattei Plan and confirms the strategic role of the Climate Fund in promoting economic growth and environmental sustainability in West Africa.”
Dario Scannapieco, CEO of CDP, added, “This €100 million hybrid bond, the first euro-denominated one issued by an African multilateral development institution, will provide crucial support for renewable energy projects across the eight West African countries. It reflects our ongoing efforts to align with the UN’s Sustainable Development Goals and bolster Africa’s climate change mitigation strategies.”
The agreement between Italy and BOAD represents a significant step forward in global efforts to combat climate change, showcasing innovative financing mechanisms and strengthening partnerships for a sustainable future.
Editor: Gabriel Ani
