Zambia: Kukula Capital to manage new fund
World Wide Fund for Nature Zambia (WWF), Zanaco Bank and Kukula Capital signed a letter of intent to collaborate on the implementation of programmes aimed at developing a green economy for Zambia. Key to the letter of intent is the establishment of a ZMW 1 billion (about $58 million) Green Outcomes Fund that will invest in scalable small and medium sized businesses that seek growth capital, are committed to make the transition to green production practices and the creation of green jobs. The fund will target to invest in projects that are green and bankable in the following thematic areas: climate resilient agriculture, sustainable forestry, cleaner energy sources, and sustainable use of natural resources. Subject to regulatory approval, the governance and operational structure of the fund will be operational by June 2022.
According to WWF Zambia country director Nachilala Nkombo, “This exciting partnership between WWF Zambia, Zanaco and Kukula Capital responds directly to the threat of climate change and environmental degradation faced in Zambia’s economy today. This fund will simultaneously support the growth and green ambition of SMEs by assisting them to mitigate these environmental risks, while delivering business and social returns to their shareholders, communities and customers.”
Commenting at the signing ceremony, Zanaco chief executive officer, Mukwandi Chibesakunda said, “The protection of the environment is everyone’s responsibility and it goes beyond climate change, it’s about what we deliberately do, for future generations to have a safe planet to live in. It is for this reason that as a financial institution, we have taken the step to provide the anchor funding for the Green Outcome Fund.”
WWF and Zanaco are the key sponsors of the fund and have retained Kukula Capital to manage the fund on behalf of the partners and investors. Kukula Capital is an SME fund manager in Zambia regulated by the Securities and Exchange Commission. WWF will further provide technical assistance to the fund and to investees to achieve the environmental targets outlined in the investment policy. Zanaco as the financial services partner and key sponsor has committed ZMW 10 million (about $577,800) towards the first closing of the fund.
“Zambia is well positioned to become a leading green investment destination in Africa and has competitive advantage through its rich endowment of natural resources. We are excited to launch the fund which will create positive social and environmental impact,” commented Tue Nyboe Andersen, managing director, Kukula Capital.
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