The manufacturing pillar of the Big Four agenda has received a boost after the investor responsible for putting up the largest wind farm project in Africa, Lake Turkana Wind Power Project, committed to continue funding more green projects in Kenya.
Norfund, having been instrumental in realizing the Lake Turkana Wind Power and a major investor in Equity Bank has reiterated its commitment to significant investments in the region.
The Regional Director, Norfund East Africa, William Nyaoke speaking on Friday during the launch of the firm’s three-year strategy said they are incredibly proud of their committed portfolio of 776 million USD in over 520 companies in East Africa.
Nyaoke speaking at their office in Westlands said that the capital deployed has transformed millions of lives through employment, access to finance and clean energy.
“The launch of our new strategy will provide a framework for greater partnerships and impact across East Africa. The fund’s new strategy incorporates scaling up investments in the manufacturing and agribusiness sectors, as well as a new investment pillar on green infrastructure, including waste management, access to clean water, transmission lines and power storage,” said Nyaoke.
He explained that Norfund has been investing in East Africa for over 20 years with investments in clean energy constituting almost 40 percent of its portfolio in the region. Some of Norfund’s investments include projects such as Globeleq, Lake Turkana Wind Power, Bujagali Hydro Power and M-KOPA.
“Norfund’s investments in scalable enterprises aim to contribute to job creation and economic transformation, in manufacturing and agribusiness value chains. Job creation is key for economic growth and fighting poverty. So far, the portfolio includes SMEs like Tanzanian grower, Africado, flower producer Marginpar and the logistics company Freight in Time. Going forward, Norfund will particularly step up investments in the manufacturing sector,” the director said.
He added that Norfund has been a long-time investor in strengthening financial inclusion with investments in banking insurance and financial services. It is a founding partner of the banking platform, Arise which holds a stake in 10 different African financial institutions and is a major investor in Equity Bank.
“East Africa economies are leading in Africa with continuously improving infrastructure, a young and educated labour force, providing good conditions for investments. Norfund committed over 90 million USD in East Africa in 2019 alone and is expected to increase its commitments significantly in the next few years,” said Nyaoke.
He explained that the World Bank estimates that about 2 billion metric tons of municipal solid waste are produced annually worldwide and overall waste generation will increase to 3.4 billion metric tons by 2050.
“An estimated 13.5 percent of today’s waste is recycled and 5.5 percent is composted. Between one-third and 40 percent of waste generated worldwide is not managed properly and instead dumped or openly burned,” he said adding that this continues to pose serious risks to the ecosystem and human health.
Nyaoke added that the new green infrastructure pillar which includes investments in waste management will complement Norfund’s existing investment focus areas. The fund targets to execute 6-10 new investments focusing on business models in solid and liquid waste management, access to clean water, electricity transmission lines and power storage.
Norfund CEO Tellef Thorleifsson said that they want to address urbanization challenges.
“The waste industry needs to professionalise and scale. We are one of the first development finance institutions to focus on waste management. We have started to see exciting new business models in the sector, built on circular economy principles,” said Thorleifsson.
Thorleifsson explained that effective collection, recycling and waste-to-energy is great for both societies and the environment.
“With the right investment in the right places it will also be an exciting business category and employment generator for decades to come,” Thorleifsson said.
By Joseph Ng’ang’a