The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) has signed insurance deals worth a total of €420mn aimed at boosting infrastructure development in West Africa.

In the past week, Société Générale secured cover from the ICIEC, an Islamic Development Bank (IsDB) member, for a €259mn murabaha facility extended to the Senegalese government.

Funding is earmarked for the construction of a new highway between Dakar and the nearby city of Tivaouane, as well as the expansion of an existing road in Senegal’s capital, the ICIEC says.

“Upon completion, these roads will significantly reduce travel time, facilitate smoother transportation of goods and services, and bolster economic activities across the region. They are also expected to create numerous jobs during and after construction,” says a statement from the ICIEC.

ICIEC’s CEO, Oussama Kaissi, says both projects will “invigorate trade and improve the quality of life for the people of Senegal”.

A lack of financing remains a key hurdle for infrastructure development in Sub-Saharan Africa, with the African Development Bank estimating a yearly funding gap of between US$68bn and US$108bn for such projects.

Meanwhile, the UN says a third of the population lacks electricity and 40% of people live more than 5km from their nearest all-season roads.

Public insurers – as well as export credit agencies from across Europe, Asia and North America – often play a key role in ensuring large-scale infrastructure projects reach financial close. Increasingly, new players, such as ECAs from Poland and India, are looking to grow their activity on the continent.

As part of the Société Générale agreement – signed at the IsDB’s annual group meeting in late April – the ICIEC is insuring the bank against the risk of non-payment by the Senegalese government.

On the sidelines of the IsDB event, the insurer also agreed a deal with Deutsche Bank, covering the lender for non-payment risks on a €161.4mn loan to the government of the Republic of Côte d’Ivoire.

The West African state will use the financing to build hospitals in the cities of Kong and Odienne, “significantly boosting the healthcare infrastructure in Côte d’Ivoire”, the ICIEC says.

In its annual report, published last week, the ICIEC says it recorded a “significant” year-on-year increase in the value of trade and investment transactions it insured in 2023, up 14.4% to US$13.3bn.