Increasingly, long-term institutional investors are seeing opportunities in investing in renewable energy assets and climate change mitigation strategies, while trying to incrementally lower the carbon footprint. Ithmar Capital, a public investment fund from Morocco, has taken center stage on renewable investments. In November, the United Nations hosted the climate change summit in Marrakesh, Morocco. SWFI editorial has asked Ithmar Capital’s CEO Tarik Senhaji three key questions for our audience to get a better handle on what’s going on.
1. What was the genesis of creating Ithmar Capital and what role will it play for the country?
Ithmar Capital is part of the long-term development plans initiated by The Kingdom of Morocco in different economic sectors. While its initial focus was on tourism and infrastructure investments, Ithmar’s mandate has been extended in 2016 to cover all economic sectors in Morocco. Ithmar is a strategic publicly-sponsored investment organization with a dual objective: fostering development in Morocco and Africa while delivering financial performance. Its inception started from the identified demand of different institutional investors and sovereign funds willing to invest in different productive sectors of Morocco and looking for a local partner to reduce the project risk.
Ithmar’s strategy is aligned with State’s macro-economic strategies. The Fund takes strategic stakes in socio-economic projects and promotes policies that contribute to the development of key sectors of the national economy. As such, Ithmar plays an important role investing in projects in times when liquidity is scarce and in catalyzing foreign direct investments.
Ithmar Capital is a gateway to implement the proactive engagement of the Kingdom in terms of partnership and expertise.
2. Many pensions and a number of sovereign funds, such as the New Zealand Superannuation Fund, have a mandate to back climate-related commercial investments. What types of investments are going to be available in the GGIF Africa fund?
GGIF Africa aims is to implement major green development concepts and large infrastructure projects with the objective of catalyzing the evolution of Africa into a green economy.
Africa offers a great infrastructure potential, and research have demonstrated the necessity:
- Only 1,000 MW of electricity production have been developed during the last five years when Africa needs 7,000 MW on a yearly basis;
- Less than 5% of agricultural lands are irrigated;
- Less than 10% of the hydroelectricity potential has been utilized;
- Only 58% of Africans have access to drinkable water.
GGIF Africa projects will focus in scope on low carbon infrastructure, clean energy generation, low carbon transportation and efficient water usage to address the gaps highlighted above.
3. Will solar or wind investments be included in the GGIF Africa Fund?
Solar and wind investments will be encompassed as they perfectly fit into the definition of green projects in scope of GGIFA.
As stated above, Africa offers a great potential and electricity requirements in Africa are huge: less than 40% of Africa’s population has access to electricity (less than 30% in Sub-Saharan Africa), which creates immense opportunities for GGIF Africa investors.
The use of wind and solar energy has become more popular lately and has proven great benefits for both investors and the population. A concrete example is the implementation of solar and wind energy platforms in Morocco which has been successful so far and hence the experience can be replicated in other African countries.
In a bid to establish itself as one of the region’s leading providers of financial services, Emirates NBD – Dubai’s largest bank – has entered into a deal to acquire a 99.99% stake in Turkey’s DenizBank A.Ş. for a bargain price of US$ 3.2 billion from Russian state-owned lender Sberbank. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Brazilian President Michel Temer signed an executive order to shut down the country’s sovereign wealth fund. The money in the sovereign fund will go toward repayment of foreign debt.
The Sovereign Fund of Brazil, also known as Fundo Soberano do Brasil, was formed in 2008.
The formation of the Fundo Soberano do Brasil was authorized by then Brazilian President Luiz Inacio Lula da Silva.
Caisse de dépôt et placement du Québec (CDPQ) boosted its ownership stake in Chicago-based Invenergy Renewables LLC. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
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