In a year in which development aid was sharply reduced and investments in developing countries fell, Norfund went against the tide with record investments of NOK 8.4 billion in 2025.

“The needs are enormous, and we see major opportunities to make an effective difference through profitable investments,” says Tellef Thorleifsson, CEO of Norfund.

According to new figures from UNCTAD, global foreign direct investment (FDI) increased by 14 percent in 2025, reaching USD 1.6 trillion. Even so, investment in developing economies continued to decline – down 2 percent to USD 877 billion – for the third consecutive year. Low‑income countries were hit hardest, with three quarters of the least developed countries experiencing stagnation or a fall in capital inflows. In 2025, poor countries also saw major cuts in development aid.

“In a challenging global situation, we are pleased to be able to increase our contributions through profitable investments that create jobs, generate tax revenues and avoid emissions,” says Thorleifsson.

Thorleifsson recently announced that he will step down as CEO of Norfund this summer. Since taking up the post in 2018, Norfund’s total portfolio has more than doubled, reaching NOK 45.5 billion at the turn of the year.

“It is incredibly meaningful to see that, year after year, we have been able to scale up our contributions through investments that have also proven profitable. At a time when development aid worldwide is under pressure, it is especially important to use funds efficiently, mobilise private capital and deliver sustainable results,”

Tellef Thorleifsson

CEO in Norfund

The investments are distributed across three mandates – Norfund’s original development mandate, the Climate Investment Fund, and the Ukraine Fund, which was established in December 2024.

70 percent of Norfund’s investments in 2025 went to Africa, 15 percent to Latin America, 10 percent to Asia and 5 per cent to Ukraine.

Norfund and OP Finnfund has invested USD 15 million in long-term capital in Softlogic Life Insurance PLC to help expand access to insurance and strengthen financial security for households across Sri Lanka.

For families, insurance can determine whether illness or unexpected events lead to recovery or long-term financial strain. Softlogic provides life and health insurance to more than 1.3 million people across the country.

Technology that reduces administrative barriers

The investment supports Softlogic’s use of digital solutions to make insurance simpler and more accessible. Automated underwriting, faster claims processing, and digital health services reduce administrative hurdles and improve customer experience across income groups and regions.

These systems allow the company to scale protection products nationally, including health and microinsurance solutions, at lower cost per customer.

Norfund’s second investment in Softlogic

Norfund first invested in Softlogic during the pandemic in 2020. Since then, the share of the company’s insurance revenues coming from products for low-income customers has grown from about one percent to five percent.

Today, Softlogic provides insurance coverage to more than 490,000 low-income individuals, up from around 300,000 when we made our initial investment, out of a total client base of 1.3 million.

“Softlogic has demonstrated sustained growth, prudent capital management, and a clear commitment to expanding insurance access including microinsurance products in Sri Lanka. Our investment supports an organisation that plays a meaningful role in strengthening financial resilience for households across the country,”

Fay Chetnakarnkul

Regional Director in Asia

“The partnership with Norfund and OP Finnfund supports our expansion agenda and enhances our capacity to deliver protection solutions that create long-term value for Sri Lankan families,”

Iftikar Ahamed

Managing Director of Softlogic Life

Did you know?

• Health expenses paid out of pocket are a major driver of poverty in low- and middle-income countries, pushing millions of people into poverty each year.
• In the absence of insurance, households often cope with shocks by selling productive assets or reducing investments in education, with long-term consequences for income and human capital.
• In Sri Lanka, households’ out-of-pocket payments account for a significant share of total health expenditure, despite the country’s policy of free public healthcare. As a result, many families still rely on their own funds to pay for medicine, treatments, and private health services.

The Ukraine Fund, managed by Norfund, is investing NOK 174 million (EUR 15 million) in a fund aimed at supporting investments in sectors that are critical for Ukraine’s reconstruction. The first project is a wind farm in the Odesa region. It will help strengthen energy security in a country where large parts of electricity generation have been destroyed by Russian attacks. 

At the same time as major parts of Ukraine’s power supply have been knocked out by Russian strikes, the country is facing severe cold with temperatures below minus 20 degrees Celsius. On 14 January, President Zelensky declared a state of emergency in the energy sector. 

Norfund has managed a dedicated Ukraine Investment Fund since December 2024. The fund is now investing in the Horizon Capital Catalyst Fund (HCCF), which simultaneously announces its first investment—a wind power plant being developed by Notus Energy. 

Both agreements were signed today/20 January at Ukraine House in Davos, where Foreign Minister Espen Barth Eide participated. Energy was one of the key topics on the agenda when the Foreign Minister met President Zelensky earlier this month. 

“These are funds Ukraine desperately needs — and needs now. Ukraine has enormous needs for investments in new energy production. Energy for heating, food, and everyday life is crucial for Ukrainians to endure this war. I am pleased that we can now also contribute to this through investments via the Ukraine Fund,”

Espen Barth Eide

Foreign Minister

The equity investment from HCCF enables Notus Energy to secure a package of loan financing that allows the company to begin construction of a 124 MW wind park in the Odesa region. 

“We are pleased to have made solid progress in investing in Ukraine, and that we can now make our first investment in the energy sector through HCCF, which we hope will also attract more international investors to the country,”

Tellef Thorleifsson

CEO of Norfund

This is the third investment under the Ukraine Fund. With this investment, Norfund has deployed NOK 430 million of the NOK 500 million allocated to the fund for 2024 and 2025. The 2026 state budget sets aside an additional NOK 500 million for the fund. 

HCCF aims to raise EUR 300 million and mobilize EUR 3 billion in investments in energy, digital infrastructure and building materials—sectors that are crucial for restoring the economy and securing basic services. HCCF is established by Horizon Capital, one of Ukraine’s leading private equity firms, with over 30 years of experience and USD 1.6 billion under management. In addition to Norfund, the fund has already secured commitments from EBRD, IFC, Swedfund, Proparco and FMO. 

Facts about the Ukraine Fund

• Established on 19 December 2024, managed by Norfund, the Norwegian investment fund for developing countries 
• Part of the Nansen Programme 
• Aims to contribute to sustainable business development and job creation in Ukraine 
• So far, Norfund has made investments totalling NOK 430 million through the fund 

Tellef Thorleifsson has informed the Norfund Board that he will step down from his position as CEO in July. During the 7.5 years Thorleifsson has led Norfund, the fund has doubled its invested capital, tripled annual investments, and been entrusted to manage two new mandates.

“I have great confidence in what we do at Norfund, and I am proud of the results we deliver in the fight against poverty and climate change through profitable investments. At the same time, I believe this is a good moment to carry out a leadership transition,” says Thorleifsson.

Since Thorleifsson assumed the role of CEO of Norfund, the Norwegian government’s investment fund for developing countries, in autumn 2018, the fund has doubled its portfolio and almost tripled its annual investments. At the same time, Norfund has been entrusted with managing a Climate Investment Fund and a Ukraine Fund.

“Tellef has done an impressive job developing Norfund into a professional organisation that delivers effectively on the fund’s mandates to create jobs that lift people out of poverty and to avoid greenhouse gas emissions. We are deeply grateful for his efforts and the results he has achieved,” says Norfund Chair Olaug Svarva.

In 2024, 712,000 people were employed in companies in which Norfund has invested. During the year, 14.6 million new customers gained access to financial services, and 750,000 households gained access to renewable energy from Norfund’s investees. These companies paid NOK 41.2 billion in taxes. At the same time, Norfund’s average return has been 8.7% (in NOK).

The Climate Investment Fund, which Norfund has managed since 2022, had by the end of 2024 invested in projects that will annually avoid emissions of 17.6 million tonnes of CO₂—equivalent to 40% of Norway’s emissions—with an average annual return of 19% (in NOK).

The Norfund Board is now initiating the process to appoint a new CEO.

My name is Vegard and I have been an intern in the Financial Inclusion department at Norfund.  In six months, I have learned a lot about development finance, the function of financial institutions, and the importance of access to financial services. 

The first weeks

My academic background is from the Norwegian School of Economics, where I completed a double degree in financial economics and international management. I have previously worked in corporate banking in Asia and in real estate across Northern Europe, and I now work with Norfund’s investments in financial institutions, including banks, microfinance institutions, and fintechs, across Africa. 

Our first weeks were filled with engaging introductions to Norfund’s work and values, but most importantly, we had the opportunity to meet colleagues from across the organization and hear their inspiring stories during Norfund Week.

Financial Inclusion

My department’s mission is to make financial products and services accessible and affordable for underserved businesses and individuals. More than a billion adults remain unbanked, and our team is working hard to reduce this number. To do so we need to fund financial institutions that in sequence funds underserved individuals and companies in a fair and efficient way. Our job is to identify, analyze, and invest in such institutions.

So far, I have contributed to identifying potential investments by looking into macroeconomic conditions in several African countries, mapping fintechs and banks, and participating in a business development trip to a technology conference in Cape Town, South Africa. While in Cape Town, we also met with existing and potential investees and partners that Norfund invests together with—an excellent opportunity to see firsthand how important this aspect of Norfund’s work is. I also learned a lot from the experienced colleagues I travelled with. 

I have also been placed on the team for several ongoing investments, where we dive deeper into the companies’ underlying operations, financials, and risk profiles. As an intern, you effectively take on the role of an analyst, so a solid understanding of financial theory, financial modelling, and accounting is valuable. No two investment projects are the same, especially at Norfund. For anyone interested in the intersection between finance and economics, the Financial Inclusion department is an ideal place to intern. 

In addition, I have worked across departments with the other interns on a project examining Norfund’s true currency exposure and the potential use of stablecoins in emerging markets. We learned a great deal through this collaboration and delivered a project that contributed value to the organization. 

The internship experience

The best thing about Norfund is the people. There are around 160 inspiring individuals from 33 different nationalities that always want to help. Everyone is striving for the dual mandate of Norfund, and you can really feel that this is what motivates the team here. I think this is quite unique when it comes to private and venture capital. The nature of Norfund’s mandate and mission makes the work varied and you gain experience in a lot of markets, industries, and financial instruments. 

Norfund is investing USD 15 million in the Rebuild Ukraine Fund (REBUF), managed by Dragon Capital, to help address the shortage of equity capital for Ukrainian businesses. 

The ongoing war has severely constrained investment activity, leaving small and medium-sized enterprises (SMEs) without the resources needed to grow, create jobs, and contribute to Ukraine’s economy. SMEs are employing over 60% of the workforce in Ukraine.

The Rebuild Ukraine Fund targets a total size of USD 250 million and will focus on majority investments in resilient businesses across sectors such as consumer goods, healthcare, manufacturing, and technology. 

“As in Norway, small and medium-sized enterprises form the foundation of Ukraine’s economy. This investment strengthens these businesses, enabling job creation, resilience, and reconstruction during wartime,”

Åsmund Aukrust

Minister of International Development

Norfund’s investment will be part of the fund’s first close, alongside commitments from other European development finance institutions including IFC and EBRD. Together, these contributions will help mobilize additional international capital and strengthen Ukraine’s private sector.

“By providing growth capital to these businesses, we are supporting job creation, innovation, and the rebuilding of critical supply chains. With a dedicated team on the ground and a strategy built for wartime conditions, REBUF will support companies with strong local roots and growth potential,”

Tellef Thorleifsson

CEO at Norfund

Dragon Capital’s track record and deep local presence make it a great choice for a trusted partner for Norfund in Ukraine.

“The reconstruction of Ukraine depends on companies that continue to operate and invest despite the war. Partnership with Norfund allows Dragon Capital to direct more capital to businesses that are developing new products, expanding capacity, and strengthening local industries. We appreciate the trust of international partners and remain focused on turning it into long-term, practical results for the Ukrainian economy”, says Tomáš Fiala, Founder of Dragon Capital.

This is the second investment made under Norfund’s Ukraine Investment Mandate, which aims to support high-risk, high-impact investments that contribute to the country’s resilience, reconstruction, and long-term integration with European markets.

“Norway’s support for Ukrainian businesses is also an investment in freedom, democracy and economic resilience. By helping sustain economic activity, we strengthen Ukraine’s ability to withstand the aggression and to shape its own future,” says Minister Aukrust. 

The Climate Investment Fund is committing 400 million kroner to Scatec’s Obelisk project in its first investment in Egypt. The hybrid plant, with 1.1 GW of solar power and 200 MWh of battery storage, will help avoid 1.5 million tons of CO₂ annually.

The project, located in Naga Hammadi in Upper Egypt, will deliver stable and cost-efficient renewable energy to a country with rapidly growing power needs. Obelisk is Scatec’s largest project to date.

The large-scale project will generate more than 3,000 GWh of electricity annually, avoiding 1.5 million tons of CO₂ emissions. That is roughly equivalent to Norway’s largest single point source, Mongstad, or about 3 percent of Norway’s annual emissions.

“This project is an example of what we need more of in development policy. By combining private and public capital, we help deliver high-tech solutions that create jobs and cut greenhouse gases in developing countries. In October, I learned about the important role Scatec plays in Egypt when I visited the country, and I look forward to following their work going forward,”

Åsmund Aukrust

Minister of International Development

Through the agreement, Norfund, via the Climate Investment Fund, will own 25 percent of the Obelisk holding company, while Scatec will own the remaining 75 percent. The French company EDF will own 20 percent of the operating company (SPV), giving Scatec and Norfund total ownership shares of 60 and 20 percent respectively.

“The Obelisk project is a good example of how the Climate Investment Fund can help accelerate the transition from fossil to renewable energy in emerging markets through profitable investments,”

Bjørnar Baugerud

Head of the Climate Investment Fund

The investment is the Climate Investment Fund’s first in North Africa and its first in Egypt. The country was added earlier this year as one of the fund’s 13 priority countries, and Norfund has worked with Scatec on this investment for an extended period.

“We are very pleased to continue our valuable collaboration with Norfund. Obelisk is the largest project Scatec has begun constructing to date, and the combination of solar and batteries will deliver stable and cost-efficient renewable energy to meet Egypt’s growing power needs and support its energy transition,” says Scatec CEO Terje Pilskog.

Since Norfund began managing the Climate Investment Fund in 2022, it has committed 5.6 billion kroner during its first three years. These investments support projects that, once completed, will avoid 17.6 million tons of CO₂ annually. That corresponds to 40 percent of Norway’s annual emissions. At the same time, the fund has delivered an average return of 14.4 percent in investment currency (19 percent in NOK).

Norfund is investing in the Programme Electricité Pour Tous (PEPT) second social bond issuance in Côte d’Ivoire to help finance up to 400,000 new grid connections for low-income households and small businesses, supporting Côte d’Ivoire’s ambition to achieve universal electricity access by 2030. 

The bond issuance (FCTC EPT 2025-2040), totalling XOF 60 billion (EUR 91 million), is structured in three tranches and issued by a securitization vehicle called “Fonds Commun de Titrisation de Créances Électricité Pour Tous” (FCTC EPT).  

Norfund will invest approximately EUR 11.5 million (XOF 7.5 billion) in Tranche B, alongside Société Ivoirienne de Banque (SIB), with the latter covered by a risk enhanced guarantee from the International Financial Corporation (IFC).  

The transaction builds on the success of the first PEPT bond issuance in 2023. It further deepens participation of local capital markets in the West African Economic and Monetary Union (WAEMU) for energy projects. 

“This investment reflects Norfund’s commitment to mobilizing long term local capital and accelerating access to affordable energy in Sub-Saharan Africa. We are delighted to support the PEPT fund as part of this Phase 2 electrification programme which is aligned with both Côte d’Ivoire’s National Development Plan, and Norfund’s objectives in accelerating energy access on the continent,” said Fabrice Mpollo, Senior Investment Manager at Norfund. 

PEPT enables low-income households to connect to the grid with a modest upfront payment, while the bulk of the infrastructure cost is paid down over time through the monthly electricity bills.  

Since its launch in 2014, the program has facilitated over 2 million connections, 63 percent of them in rural areas. The second bond issuance will finance an additional 400,000 connections, contributing to the World Bank and AfDB’s “Mission 300” initiative, aiming to connect 300 million Africans to electricity by 2030.  

Last week, IEA’s World Energy Outlook 2025, showed that around 730 million people still live without electricity, a decrease of 11 million since last year’s report. 

The investment is aligned with Norfund’s strategy to promote development impact through local currency financing and support for underserved populations, and Norfund’s goal to increase access to energy. Last year, 750,000 households gained access to electricity from Norfund’s investees. 

Norfund is part of an anchor investor group alongside the African Development Bank and The Emerging Africa & Asia Infrastructure Fund (EAAIF). The project also includes as a key stakeholder, CIE, the national electricity company and distributor in Cote d’Ivoire, which will be responsible for the implementation of the programme. 

“By joining this innovative transaction, we contribute to accelerating electricity access for underserved populations and to the sustainable development of their communities, while strengthening the alternative financing ecosystem in Côte d’Ivoire”, says Fabrice Mpollo. 

Norway is investing around NOK 100 million through its Ukraine Investment Fund to strengthen the flow of goods in and out of Ukraine. This marks the fund’s first investment in Ukraine.

The support will go toward increasing warehouse capacity in the M10 Industrial Park in Lviv, western Ukraine. 

Since the war began, much of Ukraine’s trade has shifted from east to west. At the same time, the country’s logistics capacity has been severely reduced – not least because ports on the Black Sea are under constant attack. The lack of storage and logistics facilities in western Ukraine is particularly hindering trade and economic growth. Expanding the M10 Industrial Park will make it possible to establish an important transit hub toward Europe for importing goods to the Ukrainian population and exporting goods that generate income for the country. 

“An important part of Ukraine’s resistance is keeping the economic wheels turning. The Ukraine Investment Fund’s first investment is a good example of how the fund will contribute to this by investing in sustainable businesses and infrastructure projects,”

Åsmund Aukrust

Minister of International Development

M10 Industrial Park is already operational. The first construction phase is fully leased, and the park enjoys strong international support. The Ukraine Investment Fund’s investment will help triple warehouse capacity. When fully developed, the park will offer up to 150,000 square meters of logistics space and serve as a central hub for goods entering and leaving Ukraine. The project is expected to support the creation of up to 3,000 jobs. 

Since the government decided last year that Norfund would manage the Ukraine Investment Fund, Norfund has established a dedicated Ukraine team that has worked to build an investment portfolio. The investment in the industrial park is the fund’s first investment and is being made together with a leading Ukrainian investment company, Dragon Capital. 

“By investing in the M10 Industrial Park, we help create several thousand jobs, in line with our mandate to promote sustainable business and job creation in Ukraine,” said Norfund CEO Tellef Thorleifsson.