MICROCAPITAL BRIEF: Off-Grid Market Development Fund Granting Up to $28m to Solar Distribution Firms in Madagascar, Depending on Results Toward Goals

The Off-Grid Market Development Fund (OMDF), an initiative of the Malagasy government, recently signed contracts with 12 solar companies in Madagascar, whereby the firms are receiving a total of USD 2.5 million upfront. The firms can obtain an additional total of USD 25.5 million if they reach their distribution goals, which entail the delivery of “900,000 quality solar lanterns and market-entry solar home systems by June 2024.”

OMDF has a total volume of USD 40 million, which is being deployed as a combination of results-based finance and lines of credit. The fund is backed by the Malagasy government, with support from the World Bank. OMDF is managed by Bamboo Capital Partners, an impact investing firm based in Luxembourg that focuses on agribusiness, financial inclusion, healthcare and renewable energy. Since it was founded in 2007, Bamboo Capital has raised USD 400 million and invested in 80 companies worldwide.

The World Bank Group is a multilateral organization whose goal is “to end extreme poverty and promote shared prosperity in a sustainable way.” As of 2021, it has 189 member nations. The group encompasses: (1) the International Bank for Reconstruction and Development and the International Development Association, which make up the World Bank; (2) the International Finance Corporation; (3) the Multilateral Investment Guarantee Agency; and (4) the International Centre for Settlement of Investment Disputes. During the 12 months ending June 2020, the World Bank Group disbursed funds totaling USD 54 billion.

By Tejas Gumudavelly, Research Associate

Sources and Additional Resources

Bamboo Capital Partners press release
https://bamboocp.com/wp-content/uploads/ENG-OMDF_FBR_Press-release_signature-contrats_v220421.pdf

OMDF homepage
https://omdf.mg/

Bamboo Capital Partners homepage
https://bamboocp.com/

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