AFD in Latin America and the Caribbean

News

Guatemala | The lights of Kingo

14/06/2017

In Guatemala, one inhabitant in ten does not have access to the national power grid. For nearly four years now, a Guatemalan start-up has been offering them the Kingo kit , an innovative solution to produce off-grid and low-cost solar electricity. Over 15,000 households are already equipped…


Millions of people are still without electricity in Central America. They use candles, kerosene or a generator for lighting… While these makeshift solutions are in widespread use, an innovation is gaining ground at the heart of the most remote areas in Guatemala: Kingo , a smart box which can be installed in about twenty minutes and supplies electricity by simply connecting it to a solar panel.

 

© Sarah Caroline Müller

 

This off-grid production “Is the fastest and cheapest way of developing access to electricity for rural communities who are not hooked up to the national grid”, points out Juan Fermin Rodriguez, CEO and co-founder of Kingo Energy , a company set up in 2013 in which Proparco, AFD’s private sector financing arm , became a shareholder in 2016.


Pay-as-you-go!

The financial argument really strikes home in a country where half of the 15 million inhabitants are living below the poverty line – with an even higher proportion in the Maya communities, who live in remote regions.

It is also in two of the poorest departments, Alta Verapaz and Petén, where the coverage rates of the power grid were the lowest, that Kingo started its deployment. “In under two years, we have equipped over 15,000 households”, adds Juan Fermin, “This has improved living conditions for families and safety in their homes, but it has also reduced the time spent on domestic activities and made it easier for children to study.” KIngo is currently the only alternative solution to the conventional power grid on offer in Guatemala.

How does Kingo work? A solar collector is installed on the roof of the house in return for the signing of a contract with no time commitment and the payment of time units with a prepaid card, a bit like mobile phone recharges. Once the client has entered the codes on the card, access to electricity is unblocked.

This pay-as-you-go system does not require the client to purchase equipment or pay for the system to be installed. It offers several advantages: it is cheaper, brighter, less dangerous and less polluting than kerosene lamps or candles.

Kingo also does not require any cultural adaptation by users: the recharge cards can be bought in small grocery stores, or directly from representatives from the company. In the future, it will be possible to pay the fee by mobile phone… and Kingo is planning to equip 2 million Guatemalans by 2020.

 

“Everyone wants light”

Clients currently have a choice between two options:

  • the Kingo 15 kit, which supplies three lightbulbs (five hours of lighting a day) and can recharge a mobile phone for a daily fee of 6 quetzals (70 euro cents) or 110 quetzals a month (13 euros),
  • or Kingo 100, which supplies enough power to light the main room of the house for five hours, recharge three mobile phones, and supply two electrical appliances.

Elena moved to the Caserio El Limon village in Petén province two years ago and the arrival of Kingo has changed her life. “I used to have to get up earlier, at between 4 and 5 in the morning, and prepare the meals for the day by candlelight. I can now organize myself differently, get up later, spend more time with my family and, most of all, my children can study for an hour every day. We are now fifteen families using electricity. Everyone wants light!”  Elena can now light her home for over five hours a day, recharge her mobile phone, organize the children’s homework and make her home safe, while paying 25% less.

 

© Sarah Caroline Müller 
 


We have the right approach
 
Kingo’s expansion has been made possible thanks to fundraising from several investors, including FMO, the Dutch development finance institution , and Proparco, but also thanks to the 80% reduction in the cost of solar systems since 2008.

For Juan Fermin, it is, however, essential for Kingo to meet its commitments, while being profitable: “I firmly believe that we have the right approach and that we can be both profitable and serve the public good. What matters to us is for our equipment to be more and more efficient so that we can provide more services to our users.”

But the young company’s market does not stop at the borders of Petén. Following a fundraising of USD 13.5m, including USD 4m of loans, the company aims to raise a further USD 8m. This would allow it to launch regional operations, in Honduras and Nicaragua, in Mexico and Colombia.

However, ten years after the launch of the first off-grid solutions, no economic model has yet managed to dominate the market. Could the Kingo solution make the difference? “It is our duty to implement our project regardless of the financial risk in order to close poverty gaps", points out Juan Fermin . "This is why we need financial partners like Proparco to support us.”

 

© Sarah Caroline Müller

 

►  Find out more on Kingo's official website

 

  Watch the video by Proparco 
 



It's off to Latin America!

12/06/2017

Once again this year, AFD was actively involved in Latin America and Caribbean Week : a special moment to highlight the dialogue and ties of solidarity which bind us across the Atlantic, and an ideal forum to continue mapping out a common path.

Week of mutual dialogue

As every year, Latin America and Caribbean Week (LACW) from 27 May to 9 June was marked by eclectic cultural events. AFD was actively involved by organizing conferences, seminars and a photo exhibition.

 

 

“The relationship between France and Latin America builds on common values and challenges”, points out Hervé Conan, Director of the Latin America and Caribbean Department, “AFD has a very important role to play in this context, and LACW is a great opportunity to promote the growing ties, particularly for environmental protection.” (► Read the interview with Hervé Conan on RFI -starting at 10 min )
 

Focus on Haiti

This year, a special place was given to Haiti to mark the 40th anniversary of AFD’s presence in the country. The week kicked off with a discussion seminar for collective reflection on possible avenues for improving AFD projects.

The main messages of the conference which followed: “Haiti: How to take the time for development?” were the need to be utopian and realistic, develop long-term projects (10-15 years), and support Haiti by promoting the dialogue with the State and civil society.

This essential reflection on Haiti was also enriched by the exhibition of the photographer Corentin Fohlen , for which the opening was held in the presence of Vanessa Lamothe Matignon, French Ambassador to Haiti, and Monique Roucourt, former Haitian Minister of Culture.

 

© Corentin Fohlen

 

Strategic partnerships

LACW also showcased the continent’s wealth of biodiversity, through a conference organized with the French Facility for Global Environment (FFEM) on the role played by financial innovation in nature conservation. These innovative mechanisms were illustrated by testimonies from the directors of the three main conservation funds in Latin America, Mexican Fund for Nature Conservation , MAR Fund and Funbio , respectively.

The discussions were introduced by Gilles Bœuf, President of the Scientific Council of the French Agency for Biodiversity , and recalled the importance of sustainable financing for protected areas (public or private), and of including local communities in the governance of dedicated trust funds.

On 1 June, a symposium organized at the Senate on the EU-Community of Latin American and Caribbean States (CELAC) strategic partnership also highlighted the many challenges for this region, which is open to the world, but heterogeneous and vulnerable. “The relations with the European Union, in fields ranging from the environment to education, are a means of deepening regional integration”, explained Leonel Fernandez, President of the EU-LAC foundation.


Response to earthquake in Ecuador

LACW’s last destination was: Ecuador! One year after the earthquake which hit the country in late 2016, our conference organized at the Sorbonne provided the opportunity to make an initial assessment of the response and look at the scope for progress in terms of reducing disaster risks (build back better), as well as the harmonization of the international agenda and the development of a prevention culture.

 



2016, a record year for AFD

11/05/2017

With a record year in 2016 marked by EUR 9.4bn of commitments, AFD is taking action in new fields, particularly in continental Africa

Rémy Rioux, Chief Executive Officer of AFD, presented today AFD’s results for 2016, from the perspective of its strategy for 2020.

At the request of the French President in 2015, AFD has significantly increased the volume of its financing, in line with the international community’s objectives (SDGs, Paris Climate Agreement), formed its strategic alliance with Caisse des Dépôts et Consignations, and extended its scope of operations. 
 

 

 

Rémy Rioux, its Chief Executive Officer, explains AFD’s strategy: “2016, the year of its 75th anniversary, was marked by the increase in AFD’s commitments, its strategic alliance with Caisse des Dépôts et Consignations, and the strengthening of its partnerships with civil society, territorial authorities, the private sector, bilateral and multilateral development banks, European institutions and the major foundations. With EUR 9.4bn of commitments, AFD has set out on an ambitious growth path to support the major transitions in developing countries and the French overseas territories. With its new strategy, AFD will be playing a leading role in supporting the emergence of a common world.”

In 2015, the French President set for AFD the objective of increasing its activity by +60% by 2020 to some EUR 13bn of annual commitments. It set out on this growth path in 2016.

EUR 9.4bn of projects were financed by AFD: i.e. +13% in 1 year.

Africa, all Africa, is AFD’s priority, with some EUR 4bn of commitments in 2016, a +25% increase.

  • Between 2010 and 2016, EUR 22bn were committed in Africa.
  • In January 2017, at the Bamako Summit, the French President made an even more ambitious commitment for AFD: EUR 23bn will be committed for Africa over the next five years.
  • AFD has supported renewable energy development by committing EUR 600m in Africa in 2016. It plans to devote EUR 3bn to the sector by 2020.

AFD is operating in new countries and new sectors: 

  • Argentina, Cuba, the Balkans: AFD will be extending its geographical area of operations towherever the support of a committed and solidarity-focused development bank is useful.
  •  AFD’s new strategy opens up areas of action for the future, in sectors in which AFD did not previously operate or had limited activity: governance, cultural industries, higher education, innovation and digital technology, social business, the external action of local authorities, education in development and international solidarity.

AFD and CDC: A strategic alliance active in the field

The strategic alliance between the two institutions, signed on 6 December 2016, is being operationalized in the field. At international level, it is leading to common tools, such as the EUR 600m infrastructure investment fund, whose creation was recently announced by the two Chief Executive Officers in Burkina Faso. In France, it is bringing about a closer partnership with regional and local authorities and all development actors in territories.

 


AFD’s action in 2016

Action on the five continents:

  • 50% of AFD’s financial commitments in foreign countries (some EUR 4bn in 2016, i.e. +25% in one year) are devoted to Africa, all Africa, a priority for AFD’s action, where 84% of the budget resources allocated by the State are focused. In its new strategy, AFD considers Africa as a whole: from Morocco to South Africa, from Senegal to Djibouti, with its regional dynamics, without separating the North of the Sahara from the South.
  • 20% in Asia and the Pacific to finance low-carbon projects (EUR 1.3bn in 2016).
  • 20% in Latin America and the Caribbean, with a focus on sustainable urban development (EUR 1.1bn in 2016).
  • 10% in the Middle East to finance inclusive and resilient growth (EUR 741m in 2016).
  • In 2016, AFD also earmarked EUR 1.6bn of financing for the French overseas authorities.

The markers of AFD’s action: 6 x 50%
AFD, France’s development bank, which is solidarity-focused and committed to working for populations in the South and the French overseas territories, bases its action on 6 strong markers:

  • 50% of its commitments abroad are in Africa
  • 50% of its activity concerns French-speaking countries and territories
  • 50% of its projects have positive impacts on the climate
  • 50% of its projects contribute to reducing gender inequalities
  • 50% of its beneficiaries are non-State actors (State-owned or private companies in Southern countries, local authorities, public institutions, NGOs, banks) 
  • 50% of its projects are cofinanced with other donors

AFD finances sustainable growth paths that contribute to the five major transitions which both developing and developed countries are undergoing: demographic and social transitions, territorial and ecological transition, energy transition, digital and technological transition, political and citizen-based transition.

Solutions which bring about positive impacts for populations

In 2016, AFD financed 657 development projects, which have, for example:

  • improved urban transport in New Caledonia;
  • managed tensions between host and refugee populations in Lebanon and Jordan;
  • built Burkina Faso’s energy autonomy;

Projects with measurable concrete impacts every year. Over the past 5 years, on average: 

  • 730,000 family farms supported;
  • 665 MW of renewable energies installed;
  • improved access to water and sanitation for 1.2 million people;
  • 54,000 SMEs supported;
  • 832,000 children sent to school.

 ► Find out more about the results for 2016



 
 
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