IFC Invests in Oásis Atlântico Hotel Group to Support Tourism, Jobs in Cabo Verde
Business
The IFC-arranged financing package of up to €35.5 million will provide liquidity to three hotel companies owned by Oásis Atlântico in Cabo Verde, supporting employment and supply chains as the country's tourism industry rebounds from the impact of the COVID-19 pandemic.
The financing package includes a loan of up to €10.5 million from IFC's own account, a concessional loan of up to €10.5 million equivalent in USD from IFC in its capacity as implementing entity of the Blended Finance Facility (BFF) of the International Development Association's Private Sector Window, and loans of up to €14.5 million that will be mobilized from four commercial lenders.
The investment will enable Oásis Atlântico to refinance its existing debt with longer loan maturities of up to 14 years, which are not readily available in the local market, improving its financial structure and addressing its liquidity constraints caused by the pandemic.
The investment is expected to support more than 700 direct jobs and 20,000 indirect jobs, and sustain access to a reliable source of income for more than 700 SME suppliers and farmers who provide services and goods to Oásis Atlântico's hotels.
Tourism is a key sector in Cabo Verde, representing 25 percent of its GDP and 45 percent of its formal jobs. Due to its reliance on tourism, the country's economy was significantly affected by the COVID-19 pandemic, but the tourism sector is expected to fully recover by 2025.
In addition to its investment, IFC will help Oásis Atlântico improve its corporate governance and its environmental and social performance. With three 4-star and one 5-star resort hotels in Cabo Verde, the Portuguese group is an important player in the archipelago's tourism industry.
The project is IFC's second initiative in Cabo Verde's tourism industry this year. In July, IFC announced a sustainability-linked loan to Cabo Verde Airport SA, a subsidiary of VINCI Airports, to strengthen infrastructure at the country's seven airports and help them reduce greenhouse emissions.
IFC is committed to stepping up its investment and advisory support in Cabo Verde, focusing on tourism, infrastructure, green energy, health & access to finance.