Yezdan Akcacakir, Director and Head of the Energy Sector at the Africa Finance Corporation (AFC), has articulated a compelling thesis that challenges conventional wisdom on African development finance: the continent is not capital-poor, but rather “capital-trapped.” With an estimated US$4.4 trillion in investable domestic capital—comprising pensions, insurance funds, sovereign wealth funds, banks, and reserves—the critical challenge, Akcacakir argues, lies not in the absence of funds, but in their productive mobilisation. This perspective, shared in a recent interview with Ecofin Agency, underpins AFC’s evolving strategy towards becoming a continental platform builder and capital aggregator.
The recent Poro Power green bond transaction in Côte d’Ivoire serves as a powerful case study for this thesis. This €65 million bi-currency facility, backing a 66 MW solar plant, represents the first project-finance green bond in the WAEMU zone. Beyond its immediate impact on renewable energy deployment, the transaction’s significance lies in its innovative structure, which successfully mobilised local institutional investors. Akcacakir highlights that the convergence of a green bond structure, a bi-currency facility, and a project-finance approach provided a bankable precedent for institutional investors within the franc zone, thereby unlocking a new avenue for infrastructure risk assessment and investment.
“The true innovation of the Poro Power transaction actually lies at the convergence of all the elements you mentioned—and more,” Akcacakir explained. “It is a powerful validation of our core thesis: that if you structure correctly, African domestic capital can also fund African infrastructure projects.” By employing a green bond structure instead of a conventional project finance loan, AFC expedited the path to financial close and facilitated earlier engagement with local institutional investors. The dual-currency nature of the bond, with AFC acting as the “Anchor Investor” and “Co-Arranger” for the €43 million Euro tranche, provided a robust, bankable wrapper that mitigated structural anxieties for regional players. This confidence enabled local banks and asset managers to fully subscribe to the XOF-denominated tranche, equivalent to €22 million.
This approach fundamentally alters the landscape for regional capital markets. Akcacakir noted that West African pension funds and commercial banks possess substantial liquidity but have historically gravitated towards low-yield sovereign paper due to a lack of expertise in evaluating complex project-finance risks. AFC’s role as an anchor investor effectively de-risked the entry point, demonstrating that an African-led, African-structured, and dynamically funded independent power project can be highly bankable. The successful financial close in February 2026 and the plant’s projected commercial operation date by April 2027, upon completion of what will be Côte d’Ivoire’s largest solar plant, underscore the pragmatic framework established by this milestone.
Furthermore, the Poro Power transaction exemplifies AFC’s deliberate strategy to foster a new generation of local African developers. The project was co-developed by Ivorian and Mauritian entities, reflecting AFC’s commitment to championing indigenous African developers and investors. “For too long, the continent has relied on large, international utility structures to drive independent power projects (IPPs),” Akcacakir stated. “While that model has its place, it often leaves a gap in local capacity retention. For AFC, building institutional and technical capacity within the continent is just as vital as deploying financial capital.” By anchoring such transactions, AFC aims to build a track record for qualified African developers, proving to the global market that local sponsors can successfully structure, develop, and execute world-class infrastructure. This implies a deeper commitment to early-stage project development, including providing project preparation facilities, technical advisory, and risk-mitigation instruments to elevate projects to international bankability standards.
The narrative around Africa’s US$4.4 trillion in investable domestic capital is gaining traction due to several converging factors in 2025 and 2026. Akcacakir points to the significant growth of African capital pools, with pension and insurance assets exceeding US$1 trillion in 2025. Simultaneously, the external financing environment has shifted dramatically, with Official Development Assistance declining and access to international capital markets becoming more constrained and expensive. This has amplified the imperative to re-anchor African growth on domestic capital sources, making the mobilisation of domestic savings a macroeconomic necessity.
Encouraging regulatory evolution across the continent is also a key driver. Pension regulators in markets such as Nigeria, Kenya, South Africa, Namibia, and Botswana have progressively expanded investment mandates for infrastructure and alternative assets, recognising the natural alignment between long-term infrastructure liabilities and long-term liabilities. Akcacakir anticipates that the next critical step will be enabling greater cross-border investment to allow African savings to finance infrastructure opportunities across the continent, rather than being confined within national borders.
The emergence of an ecosystem designed to unlock institutional capital is also noteworthy. Nigeria’s InfraCredit has demonstrated the efficacy of local currency credit enhancement in transforming infrastructure into an investment-grade asset class for pension funds and insurers. Similar initiatives, like Kenya’s Dhamana Guarantee Company, are extending this model continent-wide. These institutions play a crucial role in reducing risk, deepening domestic capital markets, and creating the investable pipeline that institutional investors require. These combined developments, Akcacakir asserts, signal a pivotal moment where regulation, financial markets, and specialised institutions are increasingly aligning to channel long-term savings into productive, long-term investments.
Regarding the institutional architecture required to mobilise domestic pension and insurance capital at scale, Akcacakir reiterates the Poro Power dual-currency green bond as a definitive proof of concept for the franc zone. The key, she explains, is providing the necessary structuring wrappers to enable regional pension funds and commercial banks to evaluate complex project-finance risks. AFC’s role as an institutional bridge, underwriting the Euro tranche and absorbing primary structural risks, provided the implicit “credit wrap” that allowed local XOF liquidity to flow safely. The positive feedback from Ivorian authorities regarding the unprecedented speed of execution and financial closing achieved by this bond structure highlights the potential for rapid replication. With Côte d’Ivoire’s power master plan targeting significant renewable energy expansion, the Poro Power template is well-positioned to address the infrastructure and energy gaps across the broader WAEMU region.
The remarkable milestones achieved by AFC in 2025, including a record $1.5 billion syndicated loan, an oversubscribed $500 million perpetual hybrid bond, the financial close of the $2 billion Kano-Maradi Railway, a partial exit from ARISE Integrated Industrial Platforms, and the $330 million Baomahun Gold facility, alongside the Poro Power transaction, signal a significant evolution. AFC is demonstrably moving beyond its role as a traditional project financier towards becoming a platform builder and capital aggregator for the continent. This strategic shift is central to AFC’s internal vision, positioning it as a pivotal enabler of Africa’s infrastructure development through innovative financial engineering and capacity building.
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