VIENNA, Jan. 29, 2024 /PRNewswire/ — The OPEC Fund for International Development, headquartered in Vienna, Austria, achieved a significant milestone in 2023, committing $1.7 billion across 55 projects globally. This marks a record in new commitments for the multilateral development finance institution, founded 48 years ago.
Dr. Abdulhamid Alkhalifa, OPEC Fund Director-General, highlighted the institution’s increased impact despite global challenges: “In 2023, the OPEC Fund grew its lending program in response to strong demand, raising additional funds from the capital markets. We leveraged partnerships with multilateral development banks and institutions, like the Arab Coordination Group, aiming to commit 40 percent of all new financing to climate action by 2030.”
The geographical distribution of the funds in 2023 demonstrated a strong presence in Africa (42 percent), the Middle East and North Africa & Europe and Central Asia (20 percent), Latin America & the Caribbean (20 percent), and Asia and the Pacific (18 percent). The OPEC Fund utilized various financial instruments, including public and private sector lending, trade finance, and grants operations.
Policy-based lending accounted for the largest share of the lending program (31 percent). Notable contributions included support for sustainable development government programs in Botswana, Cote d’Ivoire, Armenia, North Macedonia, Colombia, and Paraguay.
The transport and storage sector received significant support (14 percent), focusing on building roads and sustainable transport infrastructure in India, Kyrgyz Republic, Tajikistan, Uzbekistan, and Bosnia and Herzegovina.
Aligned with the OPEC Fund Climate Action Plan, nearly 60 percent of the energy sector investments supported renewable energy projects. Projects included a solar plant in Niger, a 240 MW wind farm in Azerbaijan, and two wind power plants in Uzbekistan, totaling 1 GW of renewable energy capacity.
In the financial sector, the OPEC Fund provided $171 million, partnering with governments and local banks to support small and medium-sized enterprises in Albania, Botswana, Paraguay, and Vietnam. Additionally, $273 million of trade finance was offered to partner banks.
The OPEC Fund dedicated funds to promote agricultural sustainability and fisheries in Benin, Liberia, and Zimbabwe ($59 million), education ($104 million), water and sanitation ($61 million), and health projects ($50 million) primarily in Africa and Asia.
The OPEC Fund’s debut in the capital market in January 2023, with the issuance of a benchmark SDG bond, raised $1 billion for sustainable development projects. The institution’s excellent market standing was confirmed with a credit rating upgrade to AA+ with a stable outlook by Standard & Poor’s in December.
Throughout 2023, the OPEC Fund expanded partnerships with institutions such as the Asian Development Bank (ADB), the African Development Bank (AfDB), the Arab Coordination Group (ACG), the European Bank for Reconstruction and Development (EBRD), Islamic Development Bank (IsDB), the International Atomic Energy Agency (IAEA), the United National Industrial Development Organization (UNIDO), and the World Food Programme (WFP).
About the OPEC Fund:
The OPEC Fund for International Development is the only globally mandated development institution, exclusively providing financing from member countries to non-member countries. The organization collaborates with developing country partners and the international development community to stimulate economic growth and sustainability.