The Organization of the Petroleum Exporting Countries (OPEC) Fund for International Development has signed off on two financing agreements with Madagascar totalling $65-million to boost support for sustainable socioeconomic development and energy transition.

A $35-million loan will support the Specific, Measurable, Achievable, Relevant and Time-bound (Smart) Clean Cooking Project, while an additional $30-million loan will help develop transport infrastructure through the Facilitation of Commerce Corridors Project Phase II (PACFC II).

The signing took place during the yearly meeting of investment platform Africa50 in Antananarivo, Madagascar. Africa50 was established by various African governments in conjunction with the African Development Bank (AfDB).

“By investing in clean energy and infrastructure, we are helping Madagascar address urgent needs while building a more resilient and prosperous future. These projects will have positive impacts on public health, economic growth and environmental conservation. A healthy population and a healthy economy go hand in hand,” OPEC Fund president Abdulhamid Alkhalifa said on September 27.

The Smart Clean Cooking Project is aimed at introducing clean cooking solutions in Madagascar, where only 1.6% of the population currently has access to clean fuels. About 72% of fuel is sourced from forests in Madagascar, of which 80% have already been lost.

Meanwhile, indoor air pollution from traditional cook stoves causes about 17 000 deaths in the country every year.

The OPEC Fund-sponsored project will primarily target urban centres such as Antananarivo and Toamasina, where charcoal and firewood use is highest, and aims to benefit about one-million people. By improving cooking infrastructure, promoting sustainable agroforestry and empowering local communities, especially women, the project hopes to improve public health, reduce deforestation and improve livelihoods.

Meanwhile, the $30-million infrastructure loan will be spent on developing key transport corridors in Madagascar’s southern regions, including the isolated Anosy and Androy areas, which are regularly plagued by drought and famine.

The improved infrastructure will provide better access to markets, healthcare and education for more than 1.5-million people, significantly reduce travel time and boost trade flows. The project aims to stimulate local markets, particularly in agriculture, and improve living conditions in Madagascar’s most vulnerable regions.

The OPEC Fund also signed a letter of intent for the promotion of clean cooking in Madagascar in collaboration with the AfDB, Africa50 and Madagascar’s Ministry of Energy and Hydrocarbons. This partnership is aimed at facilitating coordinated efforts to scale up clean energy solutions across the country.

The OPEC Fund's relationship with Madagascar dates back to 1976. To date, the OPEC Fund has approved 36 loans to the island country, totalling more than $290-million, with projects across the energy, transport and other vital sectors.