IPM Debt Facility

The proposed project is an investment in INCA Portfolio Manager's (“IPM”) Infrastructure Debt Facility (“the Facility”), a debt facility that is being set up to on-lend to creditworthy secondary municipalities (“munis”) in South Africa (“SA”). The Facility aims to enable access to commercial finance for creditworthy secondary cities in SA, where more than 80% of municipal financing is directed towards only 8 large metropolitan municipalities (out of over 200 municipalities in SA). In addition, the Facility is expected to be supported by a capacity building fund separately funded by the Switzerland State Secretariat for Economic Affairs (“SECO”), which will support these munis in prioritizing investment needs and in preparing bankable proposals for commercial financing. This would enable access to commercial financing for the munis to help them establish a borrowing track record and ultimately to reduce dependence on transfers from the national government..