Luanda; Washington, DC, June 15, 2015 – The Multilateral Investment Guarantee Agency (MIGA)—the political risk insurance and credit enhancement arm of the World Bank Group—announced today it is supporting Aceria de Angola’s construction and operation of a greenfield steel rebar plant in Angola.
The project represents one of the first large-scale industrial projects in Angola outside of the oil sector.
The plant consists of a melt shop that will convert scrap metal into steel billets and a rolling mill that will use the billets to produce rebar and wire rods. The factory will have an installed capacity of 250,000 tons per year, meeting a significant portion of the demand for steel rebar in Angola. There is an abundance of scrap metal throughout Angola, a legacy of the country’s protracted civil war. Collection of this scrap will provide the plant with raw materials for their steel billets while generating both environmental benefits and significant new employment.
MIGA is providing an investment guarantee of 62.49€ million covering an equity investment by KLF Capital of Luxembourg. The agency is covering the investment against the risks of transfer restriction, expropriation, and war and civil disturbance for a period of 15 years.
“We’re grateful for MIGA’s support to this investment that will bring significant benefits to Angola’s economy while also contributing environmental benefits through the collection of scrap,” says Georges Choucair, Chairman and CEO of Aceria de Angola. “We also appreciate the support of the Angolan government in encouraging foreign direct investment that helps build strong local industries.”
“MIGA is playing an important role helping investors manage risk and facilitate financing for their investments in sub-Saharan Africa,” says MIGA Executive Vice President and CEO Keiko Honda. “We’re pleased to support this investment, which will help diversify Angola’s economy and provide opportunities for low-income households to benefit from the country’s growth.”