Financing company Export Finance Australia offers a $100 million loan to the East African Agriculture and Food Investment Fund (EAAIF)
The Emerging Africa & Asia Infrastructure Fund (EAAIF) has received a significant boost with a $100 million loan from Export Finance Australia (EFA). This funding will be used to back infrastructure and renewable energy projects in South and Southeast Asia, a region that offers significant investment opportunities in climate-resilient infrastructure.
The loan aligns with the Australian government's goals to build regional resilience in South and Southeast Asia and boost trade and investment links. The EAAIF, managed by fund manager Ninety One, is part of the London-based Private Infrastructure Development Group (PIDG).
The EAAIF has been active in the region since its foundation in 2001, committing over $3 billion to more than 125 infrastructure projects in over 25 countries and 10 sectors in Africa and Asia. The fund has also attracted commitments from investors including Allianz Global Investors, Standard Bank, and Sweden's development finance institution, Swedfund.
However, the region faces a significant funding gap to meet its climate goals. According to the International Energy Agency report, South and Southeast Asia requires over $130 billion in energy investments by 2024, more than $58 billion above the average annual investments of $72 billion during 2021-2024.
To address this gap, the EAAIF has expanded its mandate in 2024 to invest over $1 billion in emerging Asian and African economies over the next four years, including South and Southeast Asia. This is a small fraction of the total investment needed, but it is a step in the right direction.
Olivia Carballo, Ninety One managing director, and Martijn Proos, co-head of its emerging market alternative credit strategy, stated that the EAAIF collaborates domestically to deliver resilient, climate-smart infrastructure to underserved markets. They emphasised that the loan from Export Finance Australia will help the fund to mobilise investment for renewable energy and infrastructure projects in the region.
The EAAIF's mission is to close the climate financing gap, and this loan is a significant step towards achieving that goal. The fund is working hard to scale up investments in the region, but the challenge is far from over. The International Energy Agency report highlights the need for more than $130 billion in energy investment in South and Southeast Asia by 2024 to meet its climate goals.
South and Southeast Asia houses more than 25% of the world's population, and it is crucial that we invest in climate-resilient infrastructure to ensure a sustainable future for its people. The EAAIF's work in the region is a positive step towards achieving this goal, but more funding is needed to meet the necessary climate targets.
References:
[1] International Energy Agency. (2024). South and Southeast Asia Energy Investment Outlook 2024. [Online]. Available: https://www.iea.org/reports/south-and-southeast-asia-energy-investment-outlook-2024
[2] Emerging Africa & Asia Infrastructure Fund. (n.d.). About EAAIF. [Online]. Available: https://www.eaaifund.com/about-eaaif/
[3] Export Finance Australia. (2023). EFA Provides $100m Loan to EAAIF to Mobilise Investment for Renewable Energy and Infrastructure Projects in South and Southeast Asia. [Online]. Available: https://www.exportfinance.gov.au/news/efa-provides-100m-loan-to-eaaif-to-mobilise-investment-for-renewable-energy-and-infrastructure-projects-in-south-and-southeast-asia
[4] The Private Infrastructure Development Group. (n.d.). About PIDG. [Online]. Available: https://www.pidg.org/about-us
[5] Emerging Africa & Asia Infrastructure Fund. (2024). EAAIF Scales Up Investments in Emerging Asian and African Economies. [Online]. Available: https://www.eaaifund.com/news/eaaif-scales-up-investments-in-emerging-asian-and-african-economies/
- The Emerging Africa & Asia Infrastructure Fund (EAAIF) aims to close the climate financing gap by investing over $1 billion in emerging Asian and African economies, including South and Southeast Asia, which faces a significant funding gap of over $130 billion to meet its climate goals as stated in the International Energy Agency report.
- Despite the $100 million loan from Export Finance Australia supporting renewable energy and infrastructure projects in South and Southeast Asia, the region requires more investment to meet its climate goals, as underlined by the International Energy Agency report.
- The blended finance approach of the EAAIF, with backing from investors such as Allianz Global Investors, Standard Bank, and Swedfund, is geared towards enhancing financial inclusion and promoting social impact, especially in underserved markets.
- To achieve its objective, the EAAIF collaborates domestically to deliver resilient, climate-smart infrastructure, and the funding from Export Finance Australia will help mobilise further investment in real-estate, renewable energy, and infrastructure projects within the region.
- As the EAAIF continues its efforts to scale up investments in the region, environmental-science and science will play a crucial role in assessing and mitigating the environmental impact of infrastructure and renewable energy projects, ensuring sustainable business practices are adopted.
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