The Emerging Africa and Asia Infrastructure Fund, a Private Infrastructure Development Group fund, has made its first two investments in Asia since expanding its remit outside of Africa.
EAAIF has committed $20 million to Vietnamese commercial and industrial solar company CME Solar to help expand its pipeline of rooftop solar projects to a peak capacity of more than 260MW.
Last month, the fund also made a debt investment of $20 million in Pakistan’s first sustainable aviation fuel facility, developed by Safco Ventures, which has signed a long-term offtake agreement with Shell for up to 145,000 tonnes of SAF from 2026.
EAAIF, PIDG’s first vehicle, was established in 2001 as the Emerging Africa Infrastructure Fund.
Until late last year, the fund focused mainly on providing debt financing for African infrastructure, although from 2019 it expanded its scope to include some Middle Eastern countries.
Over the next four years, the fund aims to invest over $1 billion across Africa and Asia, predominantly in renewable energy, transport and climate-resilient infrastructure.
Roland Janssens, managing director at EAAIF’s investment manager Ninety One, said the fund’s move into Asia will diversify its portfolio while leveraging its experience in financing African infrastructure.
Asked why Ninety One did not pursue investments in Asia under a separate fund, Janssens said the dual-region fund should carry less risk overall.
“If you build up a separate fund, you will be under enormous pressure for your first deals,” he said. “We didn’t want the pressure that comes with a new fund and the associated fundraising.”
Janssens said engaging in the two regions under one fund should also lead to a lower cost of funds, which it can then pass on to investors with lower project funding costs.
“There’s an old saying, ‘Don’t put all your eggs in one basket’.
“By having these two baskets combined, we have a better prospect of achieving the goals of PIDG as an owner.”
PIDG is backed by the development agencies of the UK, Netherlands, Switzerland, Australia, Sweden, Canada, Germany and the International Finance Corporation.
Janssens said the goal of the fund has always been assisting the development of countries by catalysing private sector investment in infrastructure.
However, he said more recently, climate resilience has come to the fore, with performance targets for the fund including environmental impact alongside financial sustainability.
Janssens said “significant discussions” took place with EAAIF’s lenders, including the African Development Bank, ahead of the fund’s geographical expansion.
“Obviously, the African Development Bank will want its money used in Africa rather than in Asia, but these are technical issues that can be addressed.”
Janssens expects the fund to attract new lenders interested in Asian investments, but said there is no plan currently to expand the equity base of the fund, which is fully owned by PIDG and its member countries.
“The fund is fairly well capitalised for its current state of development.
“More equity is always welcome but there isn’t any pressing need for it right now.”