Argan Infrastructure Fund (ARIF)

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Argan Infrastructure Fund will invest in infrastructure as well as infrastructure-linked industrial projects in the whole of Africa, with a specific focus on Morocco. Africa is characterized by a huge infrastructure deficit, which is further pushed by growing demography, urban expansion and economic growth.

The targeted sectors will be energy, transport and logistics, environment, industry and telecom.

Investments will amount to on average € 10 million in North-Africa and € 5 million in Sub-Saharan Africa. For larger infrastructure projects, the Fund will invest alongside co-investors, amongst which the investors in the Fund. The Fund will mostly take minority stakes (10 to 20 %) and the holding period will be 5 to 6 years, in line with the long-term nature of infrastructure.

BIO is investing together with other investors, such as African Development Bank, IFC, the European Investment Bank and Proparco over a period of 12 years. As ARIF’s funder, BIO will contribute to long term financing for infrastructure projects in Africa. BIO’s investment also levers other investors to commit to this fund.

Development impact:

A clear deficit in infrastructure exists in Africa, which makes private financing of infrastructure projects essential. Reliable infrastructure indeed plays a vital role in the sustainable development of emerging countries as they :

  • Increase access of the population to basic needs such as power, water, mobility and technology. Investments in infrastructure hereby contribute to the achievement of the UN Millennium Goals
  • Enhance competitiveness of the private sector
  • Stimulate commercial activity and increase the attractiveness for foreign direct investment

An investment fund as ARIF will potentially fill in this additional equity gap, which could at the end lead to the launch of much needed infrastructure projects.

The investments done by the Fund will have a major impact on job creation, tax revenues and additional energy capacity.


  • Investment amount (€):

    €6M

    Registered office: Mauritius Beneficiary countries: Mainly Morrocco, whole of Africa

  • Contract signature :

    2011

    Investment fund for infrastructure and infrastructure linked projects

  • Nature of intervention :

    Equity

  • Development impacts :

    • 1 — Local Economic Growth: Access to long-term financing for infrastructure; The investments done by the Fund will have a major impact on job creation as the projects and companies will need more workers to manage their expansion. ARIF estimates that already on one of the more advanced projects, i.e. MaghrebSteel, 550 jobs should be created. The Manager calculated that if he also realizes the other investments in the pipeline, 2,600 further jobs should be created.
    • 2 — Access to basic services and goods: Reliable infrastructure plays a vital role in the sustainable development of emerging countries as it; Increases access of the population to basic needs such as power, water, mobility and technology; with a specific focus on solar energy
    • 3 — Fight against climate change: The fund limits coal production projects; and has a focus on renewable energy projects such as solar energy projects in Morocco;
    • 4 —