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The Islamic Development Bank (IDB) has decided to loan US$180mn for projects in six African nations for the Renewable Energy for Poverty Reduction (REPoR) programme
REPoR focuses mainly on improving access to electricity through off-grid energy solutions - mini-grids that combine solar and diesel energy which are low-cost, stated IDB authorities.
The programme is being developed by the Islamic Solidarity Fund for Development (ISFD) - the poverty alleviation arm of the IDB - with the Infrastructure Department of the IDB. The IDB and the ISFD will provide US$125mn for the programme and raise an additional US$55mn from the development partners.
Sidi Mohamned Ould Taleb, regional director of IDB, said, "This is just seed money. The goal is to enlarge it and to build a pipeline of projects."
The bank authorities stated this project, spread across the next three years, is part of a broad strategy to deepen its involvement in the region. Based out of Jeddah, IDB is now expanding to Africa by financing large-scale infrastructure projects. Nearly half of the bank's member countries are in Africa.
Projects such as mini-grids and rooftop solar systems for Mali, Senegal, Niger and Nigeria are likely to follow and a sixth African country has not yet been determined.
IDB has previously worked on specialist programmes for the development of Africa. In 2008, it began a special programme for the development in Africa, and financed projects for health, education and infrastructure. The bank committed around US$5bn dollars for sub-Saharan Africa between 2008 and 2012, which is reportedly 23 per cent of its budget.
Taleb said that IDB planned to increase their spending to around 33 per cent or around US$7bn in the next five years.