Climate change affects the production of popular citrus fruits. Through an investment in a South African company, Norfund will contribute to climate adaptation in the form of nets that protect crops from hail and create new jobs.

“The world must drastically increase financing for climate adaptation to preserve jobs and food production, and investments like this can make a crucial contribution,” says Minister of International Development Anne Beathe Tvinnereim. 

Norfund is now investing $10 million USD in The ANB Group, a South African fruit company that produces and distributes citrus and tropical fruits to markets in Europe, Asia, and North America. In Norway, you will be able to find ANB’s “Clemengold” mandarins on store shelves. 

Nets to protect against hail 

As a result of global warming, extreme weather is taking on new forms, and in recent years, hailstorms have posed an increasing threat to South African agriculture. Higher temperatures combined with increased moisture in the atmosphere create ideal conditions for the formation of large hail, which can cause damage to property, vehicles, and people. In South Africa, significant harvests have been completely destroyed by unpredictable hailstorms. 

ANB is investing in nets that effectively protect crops from extreme weather such as hail, heat, wind, and strong sunlight. 

“Norfund’s investment will, among other things, finance climate adaptation in the form of netting that reduces waste and water consumption while increasing volumes and quality,” says Simen Berger Øby, Investment Director in Norfund. 

“This investment is an example of how climate adaptation often involves tangible solutions that can be quite simple but require significant investments. It is crucial that we use public funds to leverage private capital for such investments, as Norfund does,” says Tvinnereim. 

Investing in solar energy and energy efficiency 

South Africa’s energy mix is dominated by coal power and faces significant challenges with power outages. 

“While our various businesses have already heavily invested in the installation of solar panels, we still plan to improve our electricity efficiency and lessen our carbon footprint with more solar installations at our farms and packhouses,” says AJ Esser, co-CEO of the ANB group. 

New jobs in a country of high unemployment 

Approximately half of South Africa’s 60 million inhabitants live in poverty, and unemployment has hovered between 25 and 30 percent for several years. Low growth combined with high inflation hinders investment and companies’ ability to hire more people. 

Norfund’s purpose is to create jobs and improve lives through investments in sustainable businesses. ANB already has 2,200 permanent employees and at the height of the citrus season, this figure rises to above 6 000. The aim is to increase the quality of these jobs and create more in the years to come. 

“The collaboration between Norfund and The ANB Group contributes to increasing resilience in South African agriculture and creating new jobs that help combat poverty in rural South Africa,” says Øby.

A new investment in clean drinking water in rural India marks the inception of Incofin’s newly established Water Access Acceleration Fund (W2AF). Norfund’s 5 million EUR investment in the fund will contribute to bringing clean drinking water to the regions most affected by the global water crisis.

The W2AF fund was launched in March 2023 with total commitments of EUR 36 million, including Norfund’s contribution of 5 million EUR. The aim of the fund is to bring clean drinking water to 30 million people in the water-scarce areas in Africa and Asia by 2030, and they have plans to double this amount in the future.

The investment of EUR 7.5 million in Rite Water Solutions will improve water solutions in rural regions in India by providing comprehensive, cost effective and sustainable solutions for safe drinking water where the water sources is contaminated. Rite Water has deployed 2,500 purification units and impacted more than 2 million peoples in 12 states of India, contributing to SDG 6 of Sustainable Development Goals.

Water scarcity is, according to the UN, projected to increase with the rise of global temperatures as a result of climate change. Unless the progress increases dramatically, billions of people will lack access to clean water in 2030.

The fund is the first of its kind, with a combination of commercial private capital, development finance institutions and aid money to relieve some of the risk.

Today, 2 billion people lack access to clean drinking water. Climate change, population growth, and urbanization mean massive investments are needed to reach UN Sustainable Development Goal 6 of access to safe water, sanitation, and hygiene, but it has been challenging to mobilize capital to the sector. 

According to the World Bank, developing countries lose around 260 billion USD annually due to poor water supply. It’s estimated that each dollar invested in clean water yields a four dollar reduction in health costs. By pooling resources and expertise and catalyze additional private capital, there is hope to improve the water access for millions of people in Africa and Asia, fostering better health and economic development.

Norfund CEO Tellef Thorleifsson has announced that Bjørnar Baugerud, Senior Vice President in Norfund, will now head up the Climate Investment Fund.

Baugerud will be the first head of the Climate Investment Fund, which became operational in 2022. Through the Fund, Norfund has already put over 2 billion NOK to work, investing in renewable energy in developing countries with large emissions from coal and other fossil power production.

“None in the world is better qualified for this position than Bjørnar,” says Tellef Thorleifsson. “Having a designated responsible head will facilitate our important work in accelerating the global energy transition.”

Baugerud will also continue in his role as Senior Vice President in the Renewable Energy investment department.

“The work we do through the Climate Investment Fund is both important and incredibly motivating. I’m looking forward to taking on this new role and continuing the good work my colleagues have already put into motion,” says Baugerud.

Through an investment of USD 12 million in OH Ecosystems Ltd (“Eco”), Norfund, the Norwegian Investment Fund for developing countries, aims to create local jobs in Nigeria, while contributing to addressing some of the challenges in the cocoa value chain.

OH Ecosystems Ltd (“Eco”) builds and operates cocoa processing and confectionery businesses on the African continent. Eco has successfully acquired a majority stake in FTN Cocoa Processors PLC (“FTN”)—a publicly traded company based in Ibadan, Nigeria.  With 20,000 metric tons of installed capacity, FTN transforms cocoa beans into semi-finished products (cocoa liquor, butter and powder) for commercialization to global and local clients. Prior to this investment, FTN had been dormant and underutilised for several years.

Norfund’s investment will upgrade FTN’s operating facilities and extend its reach to produce and sell additional products into the cocoa supply chain.  Eco is supported by established leaders in the global cocoa chain including Niche Cocoa Industry Ltd, Africa’s largest indigenous cocoa processor who will serve as technical partner.

Increasing the share of cocoa processed locally  

At 4 million metric tons per year, West Africa produces more than 75% of the world’s cocoa. In 2021, Nigeria produced 290,000MTs, ranking 4^th behind Cote d’Ivoire, Ghana, and Cameroon. Unfortunately, more than 70% of West Africa’s cocoa is exported as raw material with no value-add. Norfund’s investment directly supports the increase of local, value-added transformation leading to quality job creation, local tax revenues, and foreign exchange for West Africa’s cocoa producing countries. The investment furthers Norfund’s strategy to help create sustainable, scalable businesses in Sub-Saharan Africa that promote value-add production at origin.

“We are thankful for Norfund’s partnership as we focus on building out value-add production in Nigeria.  Having partners who are aligned over the long-term on both the financial and social impact of our work is extremely important.  Together, we can contribute to Nigeria’s agricultural manufacturing with a focus on financial sustainability for farmers in the value chain” says Nathaniel Durant, Managing Director of Eco.

“This is a strategic alliance come through that will help FTN sew up her pursuit of conversion of cocoa beans, job creation, contribution to the economic diversification goals of the government, delivering value to stakeholders and actualising the vision of being a global player” says Akin Laoye, Managing Director of FTN.

Norfund’s investment will help create both technical and non-technical employment directly for 600 people and indirectly for more than 1500 across the cocoa value chain.  The investment also contributes towards the Nigerian government’s efforts to diversify export revenues by reducing its reliance on oil and gas.

Contributing to tackle challenges in the value chain

The cocoa sector faces challenges related to working conditions and the use of child labour, as well as environmental concerns. Norfund is committed to supporting companies that seek to operate in a sustainable manner, in sectors with challenging dynamics. As part of the partnership, Norfund will support Eco’s efforts in establishing a sustainable supply chain through its farmer empowerment programme dubbed ‘EcoWise’. The programme seeks to address farmer poverty, which is one of the root causes of child and forced labour in the cocoa value chain.

Eco has partnered with industry experts to establish a farmer-focused program that ensures fair compensation, improved extension services, and training for farmers working with Eco’s operating units. The program has been previously piloted in Ghana.

“The cocoa sector is a very important one for Nigeria and West Africa, and could be a key one in the push to diversify Nigeria’s revenue sources. By partnering with this management team which has deep sector experience in West Africa, a strong technical partner, local investors and current owners, we aim to contribute positively to this effort. This investment also presents us the opportunity to partner with these stakeholders to increase local processing of cocoa beans and thus capture more of the value chain dollars at origin, to create jobs and to positively impact the fight against child and forced labour and deforestation in this important value chain”

Naana Winful Fynn, Regional Director for West Africa for Norfund

The Norwegian Climate Investment fund, managed by Norfund, and KLP, Norway’s largest pension company, together commit equity and guarantees for a 168 MW wind power plant developed by Enel Green Power in India – to avoid 570 000 tons of CO2 per year.

The announcement comes as the first annual report of Norfund’s new climate mandate shows commitments to projects with total estimated avoided emissions of 6.2 million tonnes CO2e per year – equivalent to 13% of Norway’s annual emissions.  

Enel Green Power, founded in 2008 within the Enel Group to develop and manage renewable power projects globally, operates over 59 GW of installed renewable capacity in Europe, Asia, Africa and the Americas.

In July 2020, Norfund and Enel Green Power entered into a joint investment agreement for renewable energy projects in India. The first project together, the 420 MW Thar solar plant, was announced in August 2022. 

168 MW wind project

This second project is a 168 MW wind project in Gujarat state. As with Thar, Enel Green Power was awarded the rights to sell power under a government auction and has a 25-year power purchase agreement.

Via the investment partnership KNI India, Norfund brings along KLP, Norway’s biggest pension company, with joint commitments of ca NOK 317 million (INR 2,4 billion) in equity capital and loan guarantees up to NOK 530 million (INR 4 billion) towards the construction of the project. (The Climate Investment Fund owns 51% and KLP 49% of KNI India). 

The plant, which has been put into operation, is expected to produce ca 700 GWh per annum. Given India’s current energy sources, with a considerable proportion coming from coal, the project will avoid ca 573,000 tons CO2 per annum*. 

India – with the world’s greatest need for growth in the energy sector

The investment is the fourth made under the Climate Mandate in India. To meet growth in electricity demand over the next twenty years, India will need to add a power system the size of the current EU production, according to the IEA.

In 2022, India’s power output grew at the fastest pace in 33 years, and coal-fired power output grew by a staggering 12.4%. That also meant that emissions from power generation rose by nearly a sixth, to 1.15 billion tons, according to a Reuters analysis. 

If India is to be able to finance its growth with renewables, it is crucial that we succeed in mobilizing more capital towards these investments, in a world where investors now seem to be pulling money away from emerging markets like India.

Tellef Thorleifsson, CEO of Norfund

India needs USD 233 billion in investment, just to meet its goals for development of wind and solar energy by 2030, according to BloombergNEF. 

Climate investments will already avoid equivalent of 13% of Norway’s annual emissions 

The latest investment is part of total commitments of NOK 2.14 billion in the first year of the new Climate Investment Fund, that the Government has said will be allocated NOK 10 billion over the next five years (1 billion from Norfund’s capital and 1 billion from the state budget each year).  

According to calculations in the new annual report of the fund, that became operational last year, the commitments of this first year will already finance projects with total estimated avoided emissions of 6.2 million tonnes CO2e per year*. That is the equivalent to 13% of Norway’s annual emissions. 

The project announced today is the third investment under the Climate Investment Fund with KLP as a co-investor.  

KLP has a goal to increase climate-friendly investments by at least six billion NOK every year. We are satisfied that we with this are increasing the production of renewable energy, while it is providing positive returns to our owners.

Sverre Thornes, CEO at KLP

_{* Avoided emissions have been calculated using the harmonised “Methodological Approach for the Common Default Grid Emission Factor (2022)” and related emission factors.}  

With this operation, Norfund, the Norwegian investment fund for developing countries, makes its first investment in renewable energy in Sri Lanka. 

Greenpower SL, a France-based renewable energies producer, has announced today the conclusion of a USD 4m capital raising designed to accelerate the implementation of its solar projects in Sri Lanka. This fundraising will allow Greenpower SL to accelerate the construction of solar power plants, developed and installed on the roofs of Sri Lankan schools by its local partner Gaia Greenenergy Group.  

More than 500 schools already equipped with solar roofs 

Since 2021, Gaia and Greenpower have been installing PV solar rooftops on Sri Lankan schools and hospitals. Having commenced in the Uva Region, with over 500 schools equipped as of Q1 2023, the Franco-Sri Lankan IPP is now seeking to launch the construction of similar assets in two new provinces in the coming weeks. The combined initial investments of Norfund and Greenpower will support the overall construction of photovoltaic assets 44 MWp, to be commissioned in 2023 and help further secure the pipeline. This capacity is expected to generate  around 64 GWh per year, thus avoiding more than 41,000 t CO2 eq. per year.  

The investment is made from the new Norwegian Climate Investment Fund that was set up last year to be managed by Norfund, with the goal of alleviating greenhouse gas emissions by investing in renewable energy in developing countries with large emissions from coal and other fossil fuel consumption. Sri Lanka is one of eight prioritized countries for the new fund. 

Building an independent producer of renewable electricity in Sri Lanka 

At the closing of this operation, Greenpower will keep a majority control of its assets, and will continue to play a strategic assistance role to the local based teams of Gaia. Greenpower will from now on be aided by the expertise in the clean energy sector built up by Norfund’s team in the past years.  

Inge Stølen, Investment Officer for Norfund, said: “We are excited by this first investment in the renewable energy sector in Sri Lanka, which is a territory we know well having invested in the past in the insurance and banking sector. We believe that renewable energy is part of the answer for the key challenges faced by Sri Lanka in terms of climate change and economic dependence on oil, gas and coal imports.”  

“We are obviously proud that Norfund, whose expertise is widely recognized in the renewable energies sector in the emerging countries, is joining us. Its arrival validates the choices we have made so far to develop a 100% renewable energy IPP in Sri Lanka and to achieve this goal while maintaining the highest ESG standards”, said Pierrick Morier, chairman and co-founder of Greenpower. Sivaaji de Zoysa, founder and CEO of GAIA confirms: “Having Norfund as co-investor alongside Greenpower is a major step forward for our projects. The in-depth understanding and experience of Greenpower and Norfund of energy markets will help us to further scale-up our activities”. 

Sri Lanka is committed to the energy transition 

According to the Ministry of Economy, Finance and Recovery, Sri Lanka remains extremely reliant on fossil fuels for the production of its electricity, while the installed capacity remains insufficient to meet growing demand. The Government however supports and encourages the development of renewable energies. It has set itself the goal of increasing their renewable contribution to 70% of electricity production by 2030. The main development potential identified lies in solar and wind capacities.  

Norfund and Advances Finance and Investment Group (AFIG Funds) announce the joint acquisition of Nouvelle Mici Embaci (NME) to scale up its operations and roll out an ambitious modernization plan and regional growth strategy.

Nouvelle Mici Embaci, a subsidiary of Carré d’Or Group, is a leading packaging company in Côte d’Ivoire and Francophone West Africa. It was founded in 1983 and manufactures corrugated packaging as well as polypropylene bags and provides industrial printing services. NME’s customers are among the leading local and multinational companies in the region, a testament to the Company high-quality packaging solutions and excellent service delivery. NME directly employs over 1,000 people and is a leader in recycled paper-based packaging.

NME has demonstrated resilience over the years, recording growth and profitability despite the global shocks of Covid-19 pandemic and heightened tension in Europe.

Norfund and AFIG Funds have partnered with Bridge Bank Cote d’Ivoire and Mauritius Commercial Bank (MCB) to provide necessary acquisition financing and working capital facilities to scale the business to its next growth phase.

The co-investors will partner with the existing management team as they continue to grow the business and expand its portfolio of packaging solutions.  

This acquisition will aim to modernise NME’s operations and expand its customer base while instituting international standards in corporate governance and environmental sustainability. We are excited and proud to be part of such a landmark transaction for the industry in the Cote d’Ivoire as well as for the West African region

Fabrice Mpollo, Investment Manager, Norfund.

Carré d’Or Group will remain  a strategic customer of NME in the long term and will provide necessary support as may be required post-acquisition.

“This is the outcome of a constructive engagement to find the right partners to take over Nouvelle Mici Embaci. We are delighted to announce the sale of NME to a renowned group of investors. They have shown us the best approach and capabilities to scale up this business. This was important to us as our conglomerate intends to remain a loyal customer of NME. ‘Passing the baton’ to an able buyer with a track record of adding value to their investments is the most logical way for us to ensure the Company’s sustained growth. We look forward to continuing to support NME in a different capacity.”

Mr. Emile Abi-Aad, Deputy General Manager of Carré d’Or Group

The local corrugated paper market is estimated at 80,000 tons annually and is growing at approximately 10% per year, boosted by population growth, change in consumption habits, and higher demand in packaging as a result of industrial investments and growth in hyper-distribution, which indicate positive outlook for market players.

“This investment is our first in the Ivorian manufacturing sector and represents an important opportunity to support the management team to continue to serve as a key supplier partner and provider of high-quality solutions to many companies in the Ivorian and francophone West African markets. We look forward, along with AFIG, to supporting the management team to drive sustainable growth and expansion, to further institutionalize, and to scale its recycling capacity and thus contribute to the development of a circular economy within the region”

Naana Winful Fynn, Regional Director for West Africa, Norfund

“We are pleased with this acquisition of NME and our partnership with Norfund, Bridge Bank Cote d’Ivoire and Mauritius Commercial Bank. Innovation in the African financial system requires vision and perseverance, but this deal would not have been possible without the support and patience of our investors in AFIG Fund II, as well as the trust of a discerning seller in Carré d’Or Group. Now the real work begins to leverage on the building blocks put in place by Carré d’Or Group and implement new growth initiatives to fulfil the Company’s potential to be a true regional champion in the packaging industry.”

Mr. Papa Madiaw Ndiaye, CEO of AFIG Funds

Lack of access to finance is regarded as the most important constraint to the development of businesses in low-income countries and Colombia is no different with just 46% of the population over 15 holding bank accounts, according to World Bank indicators.

Contributing to increased financial inclusion is a key priority for Norfund in this target market. Now, Norfund has closed a USD 8MM eq. peso denominated loan with Kredit in Colombia to support its lending program to teachers and pensioners.

Loans taken with Kredit are often used to help families consolidate their debt, to improve their credit scores and become bankable and to invest in home improvements, health, and further education for family members. These loans contribute to an improved quality of life for borrowers and play an important role in economic development.

Kredit counts with 56 agencies and 19,000 clients in different cities in Colombia including some of the most rural areas.

Through a new fund Norfund will contribute to giving 30 million people access to clean drinking water in Africa and Asia. 

Today, 2 billion people lack access to clean drinking water. Climate change, population growth, and urbanization mean massive investments are needed to reach UN Sustainable Development Goal 6 of access to safe water, sanitation and hygiene, but it has been challenging to mobilize capital to the sector. 

Together with six private and public investors, Norfund is entering the first investment fund directly aimed at investments in clean drinking water in Africa and Asia. Norfund is contributing 5 million EUR (55 million NOK) to the Water Access Acceleration Fund (W2AF). 

“We are seeing a growing number of companies developing solutions to offer reasonably priced, clean drinking water. Through this fund we can help these kinds of companies get the capital they need to grow and help meet the large and growing need for more water”

Delphine Gilbert, Investment Manager in Norfund

According to the World Bank, developing countries lose around 260 billion USD annually due to poor water supply. It’s estimated that each dollar invested in clean water yields a four dollar reduction in health costs. 

Norfund sees huge potential to make a difference through water investments and has explored the sector in recent years. In 2021 Norfund invested in TransAfrica Water Systems, a company that delivers water pump solutions, water treatment, and solutions for waste management in Kenya and Tanzania. However, it has been difficult to find projects that are commercially sustainable. 

“Various challenges and different types of risk mean that many promising projects fall apart before it is possible to make an investment decision. We have unfortunately looked at a number of possible projects that have not come to fruition,” says Gilbert. 

The W2AF fund is the first of its kind, with a combination of commercial private capital, development finance institutions, and aid money to relieve some of the risk – so-called blended finance. 

“The goal is that the new fund, by taking higher risks, can show that the business models can deliver, and thus also show the way for other investors in the water sector, so that even more people can have access to affordable and clean water,” says Gilbert. 

The fund initially aims to commit 35 million USD, with the intention of later doubling that amount. The investments aim to provide 20 billion liters of water to 30 million people who currently lack access in Africa and Asia. 

Norfund increased its investments in developing countries by over 20% to a record high 6.5 billion NOK in 2022.

“We are proud of the increased contributions we have made to creating jobs, fighting poverty, and avoiding emissions, in a time when many others are pulling capital out of the world’s poorest countries despite needs there being greater than ever.”

Tellef Thorleifsson, Norfund CEO

Investments had also previously increased during the pandemic in 2021 and 2020, with 10% and 20% respectively.

Norfund has received 1.68 billion NOK from the Norwegian state development budget over the last two years, with the aim of creating jobs through investment in sustainable businesses in developing countries. In 2022 Norfund also received an additional 1 billion NOK for the first time through the new Climate Investment Fund, matching 1 billion from Norfund’s own capital.

However, Norfund invested almost 2.5 times the total amount transferred.

The new Climate Investment Fund is Norway’s most important tool in accelerating the global energy transition by investing in renewable energy in developing countries with large emissions from coal and other fossil power production. The fund became operative in May 2022. Norfund rapidly invested just under 2 billion NOK.

Just over 1 billion was invested in various energy projects, 1.8 billion was invested in businesses related to financial inclusion, and the rest went to businesses in agriculture, industry, and infrastructure.

“We are satisfied with having increased our investments significantly through three years with a pandemic and now the ripple effects of the war in Ukraine. These events have made it especially difficult for developing countries to attract the capital needed to create jobs and escape poverty,” says Thorleifsson.

New challenges – and new opportunities

Norfund made several investments throughout the last year related to local food production.

“Increased food prices as a result of the war in Ukraine is an enormous challenge, but increased import prices also open up new opportunities to instead build up local production,” says Thorleifsson.

A combination of a difficult business environment and increased interest rates have led to investments in developing countries stalling again, despite an initial hope for recovery post-pandemic.

Increased subsidies to renewable energy in the West, with the USA’s Inflation Reduction Act at the forefront, have also made investors less willing to prioritize energy investments in developing countries.

“We see an increasing need for renewable energy investments in the priority markets of the Climate Investment Fund, and we are able to contribute efficiently to avoid large scale emissions,” says Thorleifsson.