Korea to channel $600 million into energy projects across Africa

The African Development Bank, the Korean Ministry of Economy and Finance and the Export-Import Bank of Korea have signed an agreement, under which Korea will provide $600 million in co-financing for energy projects alongside the African Development Bank.

The Korea-Africa Energy Investment Framework (KAEIF) pact follows the signing on 28 May 2021 of a General Cooperation Agreement between the Bank and the Korean government. The KAEIF has a particular focus on renewable energy solutions in Africa, including generation, transmission, distribution, off-grid- and mini-grid, policy & regulatory reform, energy efficiency and clean cooking projects.

“The KAEIF demonstrates the close cooperation between the African Development Bank and the Republic of Korea on the development of Africa’s energy sector. KAEIF will provide much needed additional funding, to supplement the Bank’s financing, to support accelerated energy access and the continent’s just transition to clean energy,” said Dr. Kevin Kariuki, the African Development Bank’s Vice President for Power, Energy, Climate and Green Growth.

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The Korean Ministry of Economy and Finance stressed that “similar to how the Korean Government prioritized the Green New Deal as its latest growth engine in the post COVID-19 landscape, the Facility is expected to help African countries transition to green energy while simultaneously improving access to energy.”

KAEIF funds will also support project preparation, capacity building and knowledge-sharing activities through the Korea-Africa Economic Cooperation (KOAFEC) Trust Fund. Korea joined the African Development Fund and the Bank’s Capital in 1980 and 1982, respectively. In 2013, the Korean government set up KOAFEC as a conduit for contributions to multi-donor and special funds managed by the Bank.