Islamic Corp. for the Development of the Private Sector, the investment arm of the Saudi Arabia-based Islamic Development Bank, started a fund to finance renewable-energy projects in Central Asia and plans another in Africa.
The $35 million Central Asian fund is based in Kazakhstan, Islamic Corp.’s Chief Executive Officer Khalid al-Aboodi said today in Manama, Bahrain. The North Africa fund, expected to be about $35 million to $50 million in size, will open soon.
Financing for renewables ventures is flowing into emerging markets as governments seek to curb reliance on fuel imports and cash-strapped nations in Europe cut subsidies for clean power. Morocco in September chose developers for a $1 billion solar plant, while France’s Fonroche Energie said last month it will build Kazakhstan’s largest photovoltaic complex for $70 million.
“We want to expand the size of the funds but we must start small at first to test things in those regions,” Al-Aboodi said in an interview. Both funds are Shariah-compliant, which means they lend based on Islamic laws.