Senegalese telco Sonatel has secured a sustainability-linked loan (SLL).
International Finance Corporation (IFC), British International Investment (BII), and Proparco this week announced a financing package for Sonatel to improve telecommunications infrastructure in the country and expand access to mobile and fixed broadband services.
The local currency equivalent €87 million ($94.5m) loan includes €32 million ($34.7m) from IFC, €25 million ($27.1m) from BII, and €30 million ($32.6m) from Proparco.
The funding will help Sonatel expand its telecommunications infrastructure, including towers and cables, particularly in rural areas.
Goals tied to the financing include increasing the representation of women in management positions in Senegal and expanding the reach of digital skills programs implemented by Sonatel within the country.
“Together, we spearhead a transformative journey in Senegal, driving digital innovation and fostering technological advancements that will ultimately elevate our country’s digital landscape," said Sekou Dramé, CEO of Sonatel.
Chris Chijiutomi, managing director, and head of Africa at BII, added: “Investing in the digital infrastructure space is a priority for BII given its importance to address economic growth constraints in Africa. Our investment in Sonatel will help provide quality and affordable connectivity and directly foster inclusive economic growth, particularly in rural areas. It also aligns with our goal to invest more in the Francophone West Africa region. We look forward to working with our partners to digitally connect more people and businesses in the area.”
Sonatel is a subsidiary of French telco Orange that operates across five West African countries; Senegal, Mali, Guinea, Guinea Bissau, and Sierra Leone. The operator serves over 32 million mobile customers across these markets.
BII is the development finance institution of the UK government. Proparco is a development finance institution and subsidiary of Agence Française de Développement Group.
Proparco, which has previously given loans to Torrecom and Raxio, said the financing is the first sustainable linked facility in francophone West Africa.
Françoise Lombard, CEO of Proparco, said: “We are thrilled to support Sonatel’s investments in Senegal’s digital infrastructure to improve the quality of service and expand the geographical reach of the digital network in the country. While improving customer experience, investments in innovative solutions should eventually boost economic opportunities in Senegal. We are also supportive of Sonatel’s commitment to provide ambitious training program targeting entrepreneurs and start-ups as well as to push for a higher representation of women in management positions.”
IFC's investment is supported by the International Development Association’s Private Sector Window Local Currency Facility, which helps provide longer-term, local currency funding for high-impact projects in IDA and fragile and conflict-affected situations where local currency solutions are underdeveloped or absent.
Olivier Buyoya, IFC regional director for West Africa, added: “This partnership marks a significant milestone in Senegal’s digital development. Together with Sonatel, we are committed to delivering innovative and inclusive solutions that will have a lasting impact on Senegal’s economy and people.”
A member of the World Bank, IFC aims to encourage private-sector development in less developed countries. The group has provided financing to the likes of Togocom, Liquid Intelligent Technologies, Airtel Africa, PTCL, DigitalBridge’s Scala Data Centers, Aligned’s OData in Brazil, and others.
Sustainability-linked financing is becoming an increasingly popular way for data center firms and telcos to raise funds for projects.
