AFC, Munich Re launch $1 billion risk-sharing scheme for African bank lending
African infrastructure financing continues to face a wide funding gap, prompting lenders and insurers to look for new ways to unlock credit. AFC and Munich Re have launched a $1 billion risk-sharing programme aimed at expanding bank lending for projects across sectors including energy, transportation and communications.
Highlights
- Africa Finance Corporation and Munich Re launched a $1 billion risk-sharing scheme to boost African bank lending for infrastructure projects.
- The programme targets sectors like energy, transportation, and communications to address Africa's infrastructure financing gap and promote long-term capital access.
- Increasing lender participation aims to support economic growth and financial stability by narrowing infrastructure project financing shortfalls across African markets.
Programme targets infrastructure financing gap
As reported by Businessday, the new programme is designed to increase the availability of financing for infrastructure projects across Africa by giving banks additional risk-sharing support.Africa Finance Corporation, a pan-African infrastructure solutions provider, is partnering with Munich Re, one of the world’s largest reinsurers, to combine financing and risk management expertise under the initiative. The scheme is intended to help lenders extend more credit to projects that are considered essential to the continent’s development agenda.
Potential impact on growth and stability
The partnership is part of a broader push to support economic growth and financial stability in African markets, where infrastructure deficits continue to constrain expansion in key industries.By targeting sectors such as energy, transportation and communications, the programme seeks to improve access to long-term capital for projects that can strengthen productivity and regional connectivity. Wider bank participation in infrastructure lending could also help narrow financing shortfalls that have limited project delivery across the continent.
In our earlier article on the IMF’s updated outlook for sub-Saharan Africa, we noted that while the region’s 2026 growth forecast was revised up, inflation risks and tighter financial conditions were expected to intensify. The report highlighted rising debt-service burdens, higher global borrowing costs and climate-related shocks as factors that could pressure fiscal buffers and make funding harder to secure—setting the backdrop for initiatives aimed at expanding access to long-term infrastructure finance.
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