The Overseas Private Investment Corporation (Opic) has issued a call for proposals to establish for the first time in its history an investment vehicle that provides both social and economic benefits, creating a private equity investment fund designed specifically to improve African employment, health and overall well-being through profitable investments in African companies.
Opic issued the call to fund managers to help establish one or more Africa Social Development Funds. The fund(s) will invest in sectors capable of delivering social as well as economic benefits, such as small and medium-sized enterprises, health care, education, water and sanitation, infrastructure, and energy access, including green technology, and rural and renewable energy.
Opic anticipates that it will provide debt or partial guarantees for each selected fund, the balance to be raised through a blend of public and private capital from private institutional investors, foundations, socially-oriented investors, international financial institutions, or other interested parties.
“Opic-supported investment funds have stimulated the growth of dozens of companies in emerging markets throughout the world. Our intention with this new social development fund is to use that model to target sectors that will have a significant impact on African development,” says Opic executive vice-president John Simon. “Understanding that the fund will reward innovation, we are reaching out actively to leading investors, fund managers, foundations, and development practitioners to support its best realisation.”
The Africa Social Development Fund is part of the Africa Financial Sector Initiative announced by President Bush on May 31 prior to his trip to 2007 G8 conference. The initiative is focused on encouraging capital flows into African markets.