Cecilie Sørhus, chief of staff and global head of communications at Private Infrastructure Development Group (PIDG), explains how it is delivering positive change in countries where other investors cannot or will not go.
Private Infrastructure Development Group (PIDG) is one group with a single mission: to get infrastructure finance moving and multiplying to help accelerate climate action and sustainable development where it is most desperately needed.
Since it was established in 2002, PIDG has built a reputation as an innovative infrastructure developer and impact investor with a track record of mobilising private investment in sustainable and inclusive infrastructure in sub-Saharan Africa and south and south-east Asia.
Our investments aim to promote socioeconomic development through a just transition to net-zero emissions, by combatting poverty and contributing to the UN's Sustainable Development Goals (SDGs).
We are funded by six governments, including the UK Foreign Commonwealth & Development Office (FCDO), Netherlands Ministry of Foreign Affairs (DGIS), Switzerland's State Secretariat for Economic Affairs (SECO), the Australian government's Department of Foreign Affairs and Trade (DFAT), Sweden International Development Cooperation Agency (Sida) and Global Affairs Canada.
Over the past 22 years, we have deployed $2.1 billion in official development assistance and turned it into $5.7 billion in investment commitments. This has mobilised more than $41 billion of investment in PIDG projects, including $26 billion from the private sector.
That's not all. Since 2002, PIDG has supported 233 infrastructure projects to financial close, providing an estimated 230 million people with access to new or improved infrastructure. Our investments have included many first-of-a-kind projects, such as the first independent power producers in the renewables sector and green bonds in several countries.
Five core values inform our investment activity:
- Pioneering: We work inventively at the frontier – of practices, sectors and markets – developing new ways to make a difference.
- Partnership: We work side-by-side with our team, partners and stakeholders. We share knowledge openly and pull together to achieve our collective goals.
- Safety: People's lives, livelihoods and the environment must be protected. We insist on safe practices and work to raise standards in all our markets.
- Inclusivity: We aim to work transparently and seek out the diverse voices of our people, partners, and everyone impacted by our work.
- Urgency: We know time is short and resources are finite, so we pursue lasting results with purpose, pace and persistence.
Mobilising capital for impact
As a group, PIDG offers multiple solutions, investing throughout the life cycle of an infrastructure project and across the capital structure to de-risk and mobilise the private sector. There are many ways that we work with our partners and clients.
We can offer projects and partners technical assistance for upstream and early-stage activities, feasibility and project incubation.
We are also heavily involved in project development by sharing the risks of early-stage projects with competent sponsors, investing equity in projects and companies at the early and later stages, and making use of PIDG's in-house asset managers to ensure projects move smoothly from construction into operation.
Our long-term debt fund, Emerging Africa and Asia Infrastructure Fund (EAAIF), is one of the first and most successful blended finance funds globally, investing in a wide range of projects and companies.
Finally, through GuarantCo, PIDG's guarantee solutions arm, we can provide credit enhancement and local currency solutions to facilitate international institutional investment into infrastructure projects and to help develop local capital markets. And our onshore credit enhancement facilities help to unlock domestic capital.
Investing in frontier markets for positive impact
We operate at the frontier where other organisations cannot or will not yet go, focusing on sub-Saharan Africa and south and south-east Asia and working to overcome the challenges and market failures that prevent the deployment of infrastructure services.
We have always worked in countries that receive little or no attention, and a large proportion of our activities take place beyond the comfort zone of most infrastructure investors. Out of the more than 200 projects that have reached financial close, more than 50% are in Fragile or Conflict-Affected States, and more than 50% are in the poorest Least Developed Countries.
Through sustainable infrastructure projects, PIDG aims to have a positive impact in low-income markets to deliver a range of different outcomes aligned with our themes and priority areas.
All our projects have an embedded climate lens, focusing on low greenhouse gas emissions and climate resilience. We also aim to provide people with access to new and improved sustainable, climate-resilient infrastructure and jobs, particularly focusing on women and other underserved groups. With all our projects we consider how they plug into the wider economy, including local project contracts, forward business linkages, fiscal revenues and how they support recovery, growth and trade.
We want all our projects to support the transformation of the real economy and to help develop the local capital market for infrastructure.
Looking ahead
We are constantly looking to see where our activities can have the greatest impact, as such key elements of our 2030 strategy involve elevating our action on climate and nature and increasing our ambition and urgency to scale impact.
We also plan on taking a more deliberate and coordinated offer to market, including a large infrastructure project development platform to scale up the pipeline of bankable and operational projects with others, establishing seven or eight new local credit enhancements facilities through GuarantCo, and deploying commercial capital in Africa and Asia through EAAIF.
All the while we will be focusing on our four investment themes – capital market development, climate resilience, nature-based solutions, and inclusion – particularly in our priority sectors:
- Renewable energy and off-grid supply: Energy and electrification that power people and societies.
- Roads, electric mobility, logistics, mobile and internet infrastructure: infrastructure that moves and connects people and goods.
- Transport, water, waste management and affordable housing, particularly in sustainable and resilient cities and circular economy.
- Water and natural resource management.
And as we look to the future, our priority sectors will likely expand to include infrastructure and capital market development linked to natural carbon sinks, and renewable energy and electric mobility supply chains.
To find out more about PIDG, its projects and examples of our success stories, click here.
