Madagascar: EIB accelerating climate disaster recovery, priority clean energy and transport investment
14 January 2021
Further EUR 16.4 million disbursed in October to repair transport in Antananarivo
EUR 42m disbursed in 2020 on 4 project co-financed by the EIB
EUR 386,5 million in EIB loans to support the infrastructure in Madagascar, mainly in transport sector
Reconstruction of road and rail links in the Madagascan capital Antananarivo will be accelerated following the disbursement of EUR 16.4 million on October 29th by the European Investment Bank.
“Madagascar welcomes the technical and financial backing of the European Investment Bank and European Union that is ensuring that our country recovers from the damage caused by the global climate emergency and ensure that strategic infrastructure is more resilient to future extreme weather. Disbursement of financing to repair transport links washed away by climate disasters in Antananarivo and support for upgrading clean energy and transport links across Madagascar are supporting economic and social progress for Madagascans.” said Richard Randriamandranto, Economy and Finance Minister of the republic of Madagascar.
“The European Investment Bank is working closely with Madagascan and Team Europe partners to support reconstruction of national road and rail links in Antananarivo. We welcome the progress made that has enabled EUR 16.4 million of high-impact financing to be disbursed in the last two months. This reflects the hard work of our partners at the RoadsAgency. The EIB has supported transformational investment across Madagascar over the last 50 years and we stand side by side with Madagascar to protect vulnerable communities from a changing climate.” said Ambroise Fayolle, European Investment Bank Vice President.
“The strong partnership between Madagascar and the European Union ensure that new investment is replacing stronger infrastructure to better face a changing climate and increasing renewable energy generation. Support provided by the European Investment Bank and the European Union is transforming the lives of Madagascans and enabling economic growth and quicker recovery from recent tragic climate disasters.” said Giovanni Di Girolamo, Ambassador and Head of the European Union Delegation to Madagascar.
Roads sections in Madagascar were rehabilitated and repaired to both improve journey times and provide sustainable infrastructure. Works began at the end of 2018 following the initial EIB disbursements (now totalling EUR 30m) and was delivered in January.
The reconstruction is being carried out by the Roads Agency (AR), on behalf of the Ministry of Public Works. Apart from repairs to roads, work on renovating flood protection dams is also well under way.
Financing 100% of post-disaster reconstruction of strategic infrastructure
The financing, part of a EUR 40 million 18-year EIB loan to assist reconstruction agreed in 2017. This is supporting repairs to better protect strategic infrastructure from future flooding and adapt to a changing climate.
The EIB is exceptionally financing 100% of the reconstruction work given the climate disaster nature of the necessary rebuilding work. Concessional financing provided by the EIB is being supported by a EUR 2.7 million interest rate subsidy.
Additional project components of the Antananarivo transport reconstruction scheme are also being backed by grant funding provided by the European Union.
Accelerating clean energy and transport investment to benefit Madagascans
In recent months, the European Investment Bank and European Union have enabled transformational energy and transport investment to progress across Madagascar, with close to EUR 42m disbursed on four infrastructure projects
Following the visit of EIB Vice-President Ambroise Fayolle to Antananarivo in January, advanced construction of the Rocade project has been supported by the first disbursement of EUR 11.8m of the EUR 28m EIB loan.
This project is part of the "Grand Antananarivo Program" designed to reduce the chronic traffic congestion in the capital and comprises two missing sections of the ring roads North-East and East of Antananarivo.
In July, the EIB disbursed the second tranche of EUR 11.4 million of a EUR 30 million loan to support expansion of the Jirama Andekaleka hydropower project and increase generation of clean energy in the country.
The EIB also provided in September the first tranche of EUR 2 million of the grant of the European Union, to upgrade the RN6 and RN13 roads, after the 2.4m loan disbursed last year for emergency works. This project of EUR 235m, co-financed by the EU and the EIB will improve the country's transport links, and in particular access to two ports of economic and industrial scope respectively in the North and South of Madagascar.
New investment to supply clean energy to Madagascan cities
A new loan of EUR 81,3m has been approved by the Bank for the financing of the electrical interconnexion between Antananarivo and Toamasina (PRIRTEM-1). The EIB will co-finance the construction of a 220 kV, 270 km-long overhead transmission line and related substations that will interconnect the currently isolated power systems of the capital and the main seaport of Toamasina, thereby supporting the integration of large hydro power plants being developed in both systems and significantly contributing to climate action.
The European Investment Bank is the world’s largest international public bank and has provided EUR 825 million for long-term investment across Madagascar since 1970.
The outbreak of COVID-19 in Europe had immediate and wide-ranging consequences for investment: according to the new edition of the EIB Investment Report 2020/2021 “Building a smart and green Europe in the COVID-19 era”, EU firms are likely to reduce investment by at least 25% in the year following the crisis. The report also shows that in a post-pandemic “new normal”, investment in digitalisation, innovation and climate will be more important than ever before. Without such investment, large sections of Europe’s economy risk falling behind. However, the European Union now has the opportunity to build on its leadership in green and digital technologies to recover from the pandemic, manage the climate transition and maintain its ability to compete in the global technology race.
2020 a été une année d’activité record pour le Groupe BEI en France avec un peu plus 10 milliards d’euros de financements dédiés à l’investissement dans les secteurs public et privé. Le volume d’activité du Groupe BEI en France en 2020 s’est réparti de la façon suivante : 8,9 milliards d’euros issus de la BEI et 1,2 milliards d’euros du FEI.
In the year of the worst global health and economic crisis for generations, the European Investment Bank (EIB) Group rapidly redirected its business to fight the COVID-19 pandemic and its economic consequences on all fronts. It increased financing volumes to €76.8 billion, exceeding its own targets. A third of these funds, €25.5 billion, went into the immediate crisis response that started with a first package in March. Most of it went to small and medium-sized businesses to avoid insolvencies and job losses, especially in countries that did not have the budgetary means for massive national rescue packages.