Africa Energy Bank set up with a capital of $5 billion to tackle energy funding crisis
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In a press release, the African Petroleum Producers Organization, along with the African Export-Import Bank (Afreximbank), announced the signing of the Establishment Agreement and the Charter of the Africa Energy Bank (AEB).
The proposed bank, according to the press release, has been structured as “an independent and supranational pan-African energy development bank” with an initial capital of $5 billion.
The bank’s establishment was intended to tackle the ongoing African oil and gas funding crisis, which was triggered by the global energy transition.
The two parties took the initiative after traditional financiers withdrew funds. Africa had relied on these financiers’ funds for decades. The financiers attributed the withdrawal to climate change concerns.
Also read: Former finance chiefs demand the inclusion of climate change in debt sustainability calculations
Although the primary goal of the establishment of the bank was to fund the oil and gas industry, the release states that the bank will also be open to renewable projects.
The release mentions that AEB will seek to benefit from all forms of energy to eliminate Africa’s energy poverty.
The release also mentions that the bank, although an initiative by Africa, will be open to shareholding with any investors sharing the same mission and vision as the bank.
The ceremony was held at the Ministry of Petroleum and Mineral Resources and attended by several dignitaries from both sides.
The agreement signing reached a fruitful conclusion after two years of continuous negotiations and preparations by the concerned parties. In 2022, the two parties signed a Memorandum of Understanding to agree on establishing the AEB.
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