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Ivory Coast secures Africa's first sustainability-linked loan with World Bank guarantee scheme

Ivory Coast has raised 433 million euros ($507 million) with Africa's first sustainability-linked foreign currency loan in a transaction that also comes with guarantees from the World Bank, arrangers of the deal said on Tuesday.

In recent years, the West African nation has turned to sustainable financing to increase its resilience to climate shocks as well as diversify their funding sources. In July, it raised $337m in an ESG certified Japanese samurai Bond.

The structure of the sustainability-linked loan helped Ivory Coast to "attract significant appetite from international investors and secure favourable financial terms," said Rothschild and Co, which advised the Ivorian government in the deal.

The World Bank Group’s International Bank for Reconstruction and Development, or IBRD, offered a guarantee for the first loss while its Multilateral Investment Guarantee Agency provided a guarantee for the second.

Hiroshi Mattano, MIGA's executive vice president, said in a press release that "we are helping Ivory Coast to secure financing at better terms, accelerate climate commitments and build resilience in key sectors."

The terms of the loan, which are more favorable than standard financing, are tied to performance targets for renewable energy, prevention of deforestation as well as reforestation.

Standard Chartered acted both as sole lender and lead arranger.

The World Bank announced in December that it would support Ivory Coast with a debt for education swap. This was a first-ever transaction for this Washington-based lender.

(source: Reuters)