Support from UK Export Finance means that British firms have secured contracts to upgrade critical infrastructure in Benguela Province and protect the region against future flooding.
The UK government has issued guarantees which secure Standard Chartered Bank to arrange financing for a €415 million contract between exporter Innovo Group and Angola
The largest-ever sovereign transaction which UKEF has closed in Sub-Saharan Africa, this enables the delivery of critical infrastructure in Benguela Province, a coastal region of Angola vulnerable to flooding and poor drainage
Over a third of the contract – more than £140 million – will be spent on UK goods and services, with British and Angolan communities alike to benefit from the deal
The UK has issued loan guarantees which allow British exporter Innovo Group to secure a €415 million contract to deliver critical infrastructure projects in Benguela Province, a region in the west of Angola adjacent to the Atlantic Ocean.
The support has been issued through UK Export Finance (UKEF) – the government’s export credit agency – and means that projects will now go ahead to improve the region’s potable water supply, storm drainage, sanitation, roads, public lighting, and commercial infrastructure. This includes the municipalities of Benguela, Baía Farta, Catumbela and Lobito.
Comprising 23 individual projects, the programme is expected to support 11,000 local jobs across a range of sectors including construction over the next five years.
During the UN’s COP28 climate change summit, UKEF announces the deal as an example of the role played by international trade in supporting global adaptation against climate change and extreme weather.
Benguela Province is a coastal region vulnerable to flooding and poor drainage. UKEF’s support allows the Angolan government to finance Innovo Group’s contract using funds arranged by Standard Chartered Bank, as Structuring and Coordinating Bank, Bookrunner and Mandated Lead Arranger.
This allows the Benguela province to benefit from new water supplies, stormwater channels and drainage networks aimed at reducing the risk and impact of flooding and other climate related events.
The projects will generate a direct spend of over £140 million on UK exports which are expected to support a water supply and drainage projects, road rehabilitation and community facilities.
Andrew Mitchell, UK Minister for Development and Africa said: “This ground-breaking deal will provide critical infrastructure that will change lives and reaffirm our commitment to building mutually beneficial partnerships as we prepare for the UK-African Investment Summit next year.
“Our partnership with Angola is long-standing, and this funding will provide huge benefits to the people of Benguela province, including new water supplies and protection from the harsh impacts of climate related events including flooding.
“By teaming up to tackle climate change now, we are creating a more resilient and sustainable future – it is clear that we can go far when we go together.”
Paul Woodman, CEO of Innovo Projects, said: “We are delighted to have secured this most important project that will have a hugely positive impact for the people and communities of the Benguela province, as well as making the region more resilient to the impacts of climate change. This is the third contract we have secured in Angola with the support of UK Export Finance and we would like to thank all stakeholders, including the Ministry of Public Works & Housing, for their cooperation in bringing this project to fruition.”
Faruq Muhammad, Global Head of Structured Export Finance at Standard Chartered Bank, said: “We’re proud to be the Angolan government’s long-standing banking partner once more to bring about social, cultural and economic positive change for thousands of people in the Benguela Province, with improved infrastructure, water supply and building renovations.”
Innovo Group will also deliver projects which support the development of the local economy, including road rehabilitation works, renovation of historic buildings, andthe construction of a fish market in Benguela City for traders who currently work outdoors without refrigeration.
This follows the export credit agency’s announcement in January of support for Innovo (then trading as ASGC UK) to build a specialist burns hospital in Angola’s capital city, Luanda.