PROPARCO supports sustainable forest management in Africa
Paris, 19 July 2011. In March 2011, PROPARCO committed US$10m to the first fund specialized in sub-Saharan Africa’s forestry sector via the Investment and Support Fund for Businesses in Africa (FISEA). GEF Africa Sustainable Forestry Fund (GASFF) was launched in 2010 at the initiative of Britain’s CDC and plans to invest US$150m in the region’s forestry assets.
The investment size will typically range between US$15m and US$30m. Investments will mainly be made in existing plantations, but also in projects for new plantations or natural forest concessions. The fund targets countries that provide good opportunities for forestry investments, including Ghana, Malawi, Mozambique, South Africa, Swaziland, Tanzania, Uganda and Zambia.
GASFF will be managed by Global Environment Fund (GEF), which will bring its long-standing operational experience in forest management and wood production in emerging countries.
“PROPARCO’s financing will be supporting the preservation, sustainable management and development of Africa’s forestry resources. It will also be helping to create employment in the region and to reduce greenhouse gas emissions by several tens of millions of tons over the next ten years”, points out Pierre Rousseau, investment officer at PROPARCO’s Private Equity Division.
One of the key criteria of the fund’s investment strategy will be the need to adopt best practices in this sector and, in particular, to obtain FSC ( Forestry Stewardship Council) certification.
PROPARCO is a Development Finance Institution jointly held by Agence Française de Développement (AFD) and public and private shareholders from the North and South. Its mission is to catalyze private investment in emerging and developing countries with the aim of supporting growth, sustainable development and the achievement of the Millennium Development Goals (MDGs). PROPARCO ﬁnances investments that are economically viable, socially equitable, environmentally sustainable and ﬁnancially proﬁtable. PROPARCO is one of the main bilateral development finance institutions in the world. It invests on four continents encompassing the major emerging countries and the poorest countries, particularly in Africa, and has a high level of requirements in terms of social and environmental responsibility.
GEF Africa Sustainable Forestry Fund (GASFF) is the first private equity fund to focus solely on sustainable forestry in sub-Saharan Africa. In 2009, Britain’s CDC appointed Global Environment Fund (GEF), which has already gained a first experience in emerging markets forestry funds, to manage GASFF. With over US$120m of available resources, the fund aims to be a forerunner in the sustainable development of Africa’s forests over the next decade. The final closing is scheduled for Q4 2011, and GEF expects the Fund to exceed the $150 million target.