Published: June 1, 2021
South Africa’s Absa Bank has signed the first ever Green Loan Principles-adherent loan in Africa, with the International Finance Corporate providing the funding for renewable projects in South Africa.
The US$150mn loan will be used by Absa to on-lend to finance biomass and other renewable energy projects.
This is the first loan in Africa to comply with the Loan Market Association’s (LMA) Green Loan Principles – a set of guidelines, which are voluntary to adhere to, that provide best practice for determining whether a loan is green or not.
The IFC has provided more than US$1bn in loans globally that adhere to the LMA’s Green Loan Principles, an IFC spokesperson told EMEA Finance.
As well as providing the loan, the IFC will offer Absa technical support on developing a green, social and sustainable finance framework.
“Financial institutions and the private sector have an important role to play helping South Africa to rebuild greener and more sustainably from the impact of Covid-19,” said Adamou Labara, the IFC’s country manager for South Africa. “By increasing funding for renewable energy and climate smart projects we can help South Africa strengthen its climate change resilience and increase climate change adaptation.”
The loan comes as the South African government