Case Study

How finance is creating positive social impact in emerging markets

In the final case study session of the day at the Finance for Impact Summit, John McCalla-Leacy, Head of ESG, KPMG UK, spoke to Amit Rama, Macquarie, Reyburn Hendricks, H1 Holdings and Tutu Agyare, Nubuke Investment to showcase proven practical examples of well executed impact finance projects in emerging markets. 

According to Tutu Agyare, Managing Director of Nubuke, sustainable power is one of the key factors driving industrialization in Africa. As chairman of Volta River Authority, the largest power generation company in Ghana, Tutu is working on several projects to implement sustainable power resources in the continent.  

Amit Rama and Tutu Agyare.

The first of these projects is a 50-megawatt solar project set to utilize the largest man-made lake in Africa to generate power. The second project is with a global mining company, looking at switching out some of their thermal power with a 50-megawatt solar plant.   

The final project has a crucial social lens to it; a 900-million-dollar project in the north of Africa creating 20,000 hectares of gravity fed irrigation through solar and hydroelectric power. This project in particular is changing the way agriculture is done in the country, making it cheaper and sustainable as well as stimulating job creation. 

Reyburn Hendricks, CEO of H1 Holdings is an investor and operator of clean energy and infrastructure projects across Sub Saharan Africa. Reyburn strongly believes that impact investment in emerging markets represents a commercially viable opportunity.  He highlighted that emerging markets are a relatively capital scarce sector, so finding and investing in vehicles that provide equity capital is likely to result in a yield pick-up for investors.  

John McCalla Leacy, Amit Rama, Reyburn Hendricks and Tutu Agyare

An example of a project that Reyburn has led includes a portfolio of six windfarms. The project, funded by Macquarie and UK Climate Investments, is providing power to the grid and helping to combat South Africa’s dependence on fossil fuel. 85% of South Africa’s fuel supply is coal powered, so projects like this are critical to building a greener, more sustainable future for the country.   

Amit Rama SVP, Macquarie stressed how crucial partnerships are between emerging and developed markets when it comes to impact investing. The UK Climate Investments, a partnership between Macquarie Group and the UK Government, is a £200 million pilot investment programme investing in renewable energy and energy efficiency projects in sub-Saharan Africa and India.  It targets transformational green energy investments where UK Climate Investments capital can mobilise additional private sector capital on a sustainable basis to promote cleaner, greener growth in these developing economies. 

Amit highlighted that the partnership has a wide-reaching social impact, encouraging local skills development, empowerment, knowledge sharing and improved health and safety performance and implementation. 

Read more about the Finance for Impact Summit discussions

John McCalla-Leacy