This article was created with the support of standard chartered banks
Standard Chartered is a leader in infrastructure finance and has composed and funded critical infrastructure, power, utilities and energy migration projects for over 20 years. Due to its deep relationships with sponsors and governments, as well as a track record across sectors such as energy, transportation and social infrastructure, the bank has recently been recognized by Project Finance International as a leading infrastructure bank in Africa and the Middle East.
Africa is a vital moment in its development. Robust infrastructure is essential for sustainable economic growth, long-term prosperity and transformation. However, the continent faces a significant funding gap. The African Development Bank estimates annual infrastructure needs between $130 billion and $170 billion, with loan shortfalls ranging from $68 billion to $10 billion. Factors such as perceived investment risk, regulatory complexity, and currency volatility continue to constrain access to long-term capital.
Opportunity to expand
Africa's infrastructure finance presents both immeasurable opportunities and important challenges. Investments are increasing across sectors such as electricity, minerals and metals, transportation and logistics, oil and gas, water and sanitation, and digital infrastructure driven by population growth, urbanization, energy needs and links to trade. Standard chartered projects, including Senegal's solar initiative and Ghana's road infrastructure, demonstrate the scale and ambitions behind this momentum.
Despite the complexity, the desire for international investment remains strong, particularly from pension funds, insurance companies and private credit for stable long-term assets. With a focus on sustainability, capital is increasingly directed towards contributing inclusive development to renewable energy, healthcare and other sectors.
A few key trends are shaping infrastructure finance across the region. Countries are accelerating their commitment to clean energy, leading to strong demand for renewable energies such as solar, wind, green hydrogen and carbon capture. At the same time, the focus is on baseload thermal power, where combined cycle gas turbine (CCGT) projects in the Middle East are surged.
Battery energy storage systems are also increasing, addressing the peak shaving needs of energy systems that rely on intermittent renewable energy. On the other hand, water shortages have promoted the growth of desalination and wastewater treatment, and many projects have been formed as public-private partnerships (PPPs). Transport infrastructure, particularly megaprojects such as rail networks, airports and ports, are growing in focus, just as with digital spaces where AI adoption is increasing demand for data centers.
Joint financial model
Africa's infrastructure needs cannot be met by the public or private sector alone. PPPS and Development Financial Institutions (DFIs) play a central role in filling the gap. DFIS supports low-risk projects by providing concession funding, technical support, and environmental and social protection provisions.
Standard Chartered works closely with DFI and the government to fund PPP projects in Africa and the Middle East, provide financial advisory services, assess risk and unlock a variety of liquidity sources, such as export credit agencies, infrastructure funds, and SUKUK or project bonds.
One notable example is the Emerging Africa Infrastructure Fund (EAIF), which recently secured a $294 million debt package for infrastructure projects across sub-Saharan Africa. In Angola, the bank helped to promote a 12.9 billion euro solar distribution programme to improve rural access to clean energy. In Tanzania, the 550km standard gauge railway's USD 1.46 billion term loan highlights how infrastructure can promote regional integration and reduce freight service costs by up to 40%.
Through partnerships with institutions such as Investment and Export Credit Insurance (ICIEC) and Islamic corporations for export finance in the UK, the bank also supported infrastructure projects in Senegal and Angola. A similar collaboration supported the delivery of HAFEET Rail and Abu Dhabi waste to energy projects in the United Arab Emirates.
Sustainability and innovation
The shift towards sustainable finance and ESG investments is creating new opportunities for investors to align their portfolios with value. Investors are increasingly sought responsible investment opportunities, especially in sectors such as mining, where sustainable and ethical practices are becoming more attractive. Sustainability has evolved from compliance obligations to a key driver of strategic priorities and revenue.
New regulatory requirements, such as the ESG disclosure obligations for listed Gulf companies, promote transparency and investor confidence. Standard Chartered employs global frameworks such as TaskForce for Nature-Related Financial Disclosure (TNFD) to meet current and future demands for responsible business practices.
Africa's sustainable financial markets are attracting strong interest. The bank supports several sustainability-linked loans, including a framework developed for Bapco Energy, and has become the first national energy company to publish such a framework. In Ghana and Angola, social loans fund clean water infrastructure and university expansion, focusing on social and environmental outcomes.
The ESG debt capital market in the Middle East is also expanding. Standard Chartered was the co-green structurer of the $3 billion green bond issuance of a public investment fund, and played a key role in another bond of the same size. In Qatar, the bank has supported the country's first green guarantee for solar power projects.
African countries are also adopting energy transition investment plans that prioritize renewable energy, job creation and community engagement. Banks are partnering with DFIs and multilateral lenders to implement a blend finance structure that mobilizes private capital by reducing risk. Flagship projects such as the Noor Oalzaate Solar Complex in Morocco, the Turkana Wind Power Project in Lakes in Kenya, and the Suez Wind Energy Project were supported through these models.
Looking ahead
An innovative funding model is important to bridge the infrastructure gap in Africa. As seen in Morocco, Kenya and other areas, the blended finance structure, which combines public and private capital, improves the viability of the project. Sustainability-related loans are gaining traction by adjusting funding with ESG targets. In particular, in renewable energy, strategic projects have been increasingly increasingly long loan tenors for more than 20 years.
Refinance strategies have also evolved, with sponsors using short-term banking finance, followed by bond markets or ECA-backed refinances, particularly in the Middle East. Alternative financing pools such as DFI, ECAS, pension funds, insurance companies and asset managers are expanding access to capital.
Digitalization is driving the demand for new infrastructure solutions. Platforms such as Solv are Kenya's Standard Chartered B2B digital marketplaces that improve SME access to finance and reduce costs and trading time. This type of innovation ensures more comprehensive participation in the entire African economy.
The African infrastructure finance outlook is driven by technological advancements, sustainability imperatives, and changing capital dynamics. A continuous focus on policy liberalization, improved governance and transparent investment channels will help unlock capital. Infrastructure assets have measurable impacts and remain attractive to investors looking for long-term, stable returns.
Standard Chartered is committed to becoming a key player in Africa's infrastructure journey. Our vision is to use our global network and local expertise to act as a super connector. By linking capital to bankable projects and linking funds with sustainability goals, we can bridge infrastructure gaps, promote sustainable development, contribute to the continent's brighter and more prosperous future, and drive Africa's progress to one project at a time.
