Board of Directors Notational Vote

Monday, February 5, 2024

Information summaries for the below listed projects can be found below. 

Meeting Agenda

I. PROJECT APPROVALS

a. Africa Finance Corporation – Nigeria and Africa Regional

b. VACAP Hospitality S.A. – Senegal 
Public Information Summary 

Host Country Nigeria and Africa Regional 

Name of Borrower Africa Finance Corporation 

Project Description A direct corporate loan of up to $250,000,000 that will qualify as Tier 2 

capital for the purpose of: (i) strengthening the Borrower’s capital 

position; (ii) maintaining its prudential ratios; and (iii) supporting the 

economic recovery across member states in Africa amid high inflation, 

interest rates, and geopolitical instability. 

Proposed DFC Loan $250,000,000 

All-Source Funding Total $417,000,000 

Policy Review 

Developmental Objectives At a time when Africa’s development needs have increased, Africa is 

experiencing what the International Monetary Fund notes is an “acute

funding squeeze” with many sources of traditional financing being 

structurally underfunded and therefore limiting the region’s ability to 

finance its pressing development requirements locally. Private capital 

markets are similarly constrained by higher interest rates and depreciating 

currencies, resulting in higher debt-service costs and reduced access to 

new funding. The current status quo has left the region relying too heavily 

on funding from varied international sources, where flows are often 

sharply procyclical, and development spending is left vulnerable to

sudden shifts in global sentiment.

In response to this challenge, the Project seeks to provide relatively

uncommon patient long-term and less pro-cyclical capital to the 

Borrower’s Tier 2 financing layer to address its liquidity requirements. 

More specifically, as a Nigerian-based development finance institution

operating across the continent, the Project will enable the Borrower to

strengthen its balance sheet, increase its asset base, potentially raise

and/or otherwise mobilize additional private capital, and effectively 

achieve and maintain internal regulatory capital adequacy ratios above 

Basel guidelines in a regional macroeconomic environment characterized

by instability, shallow financial markets, high interest rates, and inflation.
Environment and Social 

Assessment 

The Project has been reviewed against the DFC’s 2020 Environmental 

and Social Policies and Procedures manual (“ESPP”) and has been 

determined to be categorically eligible. DFC Tier 2 capital loans to 

financial institutions for the expansion of leveraging capital to increase 

investment potential are screened as a Financial Intermediary C (FI-C) 

for environmental and social assessment. 

To ensure that the Borrower’s practices are consistent with the DFC’s 

statutory and policy requirements, the DFC loan will be subject to 

conditions regarding the use of proceeds. The primary environmental and 

social issues identified in this transaction relate to the need for an 

Environmental and Social Policy and commensurate Human Resources 

Policies (“ESP”) that meet the 2012 IFC Performance Standards. 

Under the DFC’s ESPP, the Borrower is required to comply with 

applicable local and national laws and regulations related to 

environmental and social performance and applicable provisions of the 

2012 International Finance Corporation’s Performance Standard (“PS”) 

1 and 2. A desk review based due diligence assessment indicates that 

because the Project will use DFC support for leveraging additional capital 

for investments to a financial institution in Nigeria, significant adverse 

impacts concerning community health and safety, biodiversity, land 

acquisition and resettlement, indigenous peoples, and cultural heritage

are not anticipated; therefore, PS 3, 5, 6, 7, and 8 are not triggered at this 

time. The Borrower does utilize private security and therefore, relevant 

aspects of IFC PS 4, Community Health, Safety, and Security are 

triggered. 

The Borrower has an environmental and social policy and environmental 

management system as described in IFC PS 1, grievance mechanisms, 

and human resources policies generally commensurate with its 

investment strategy. However, the Borrower will be required to update 

its environmental and social policy to include aligned risk categorization 

and monitoring procedures commensurate to the environmental and 

social risks, and provide a security management policy in accordance 

with DFC’s 2020 Environmental Policy and Procedures.
Public Information Summary 

Host Country Senegal 

Name of Borrower VACAP Hospitality S.A. 

Project Description Construction and operation of two hotels in Dakar, Senegal. 

Proposed DFC Loan $81,000,000 

All-Source Funding Total $162,000,000 

Policy Review 

Developmental Objectives The Project is expected to have a positive development impact in 

Senegal by supporting job creation and generating increased revenues 

and capacity in the tourism and travel sector, supporting Dakar’s 

growing position as a vibrant commercial hub for West Africa. Tourism 

arrivals in Senegal doubled between 2010 and 2019, with the tourism 

industry supporting 9% of total GDP and 369,000 jobs in 2019. While 

the global COVID pandemic significantly impacted the tourism industry 

in 2020 and 2021, employment in the travel and tourism industry is 

projected to grow an additional 13% by 2028. Dakar is also growing as 

a regional business hub, contributing to a 17% increase in visitor 

arrivals in 2023 compared to 2019 and necessitating an increase in 

international-quality accommodations. The Project will help facilitate 

the overall growth of the travel sector and overall international 

commercial ties, while creating hundreds of new full-time jobs, the 

majority of which are expected to go to women. The Project will also 

directly generate significant local economic activity through 

procurement in the Project’s supply chain.

Environment and Social 

Assessment 

Screening: The Project has been reviewed against DFC’s categorical 

prohibitions and has been determined to be categorically eligible. 

Projects involving investments in commercial developments are 

generally screened as Category B projects under DFC’s environmental 

and social guidelines because impacts are site-specific and readily 

mitigated. In addition to typical impacts from construction activities, the 

primary environmental and social issues associated with the Project 

include the need for life and fire safety measures and a robust 

environmental and social management system to ensure the Project is 
developed, implemented, and managed in accordance with the IFC’s 

2012 Performance Standards and industry-specific best practices. 

Applicable Standards: Under DFC’s Environmental and Social Policies, 

the Borrower is required to comply with applicable national laws and 

regulations related to environmental and social performance. DFC’s 

environmental and social due diligence indicates the Project will have 

impacts which must be managed in a manner consistent with the 

following International Finance Corporation’s (IFC) Performance 

Standards (PS): 

• PS 1: Assessment and Management of Environmental and Social 

Risks and Impacts 

• PS 2: Labor and Working Conditions 

• PS 3: Resource Efficiency and Pollution Prevention 

• PS 4: Community Health, Safety, and Security 

A desk-review due diligence assessment indicates the Project involves 

the construction of two new hotels located on the Atlantic Ocean 

coastline in the city of Dakar, Senegal. 

The Project site is not located in or near any protected area or sensitive 

ecosystem and adverse impacts on biodiversity are not anticipated. No 

indigenous communities or cultural heritage have been identified in the 

Project areas, and the Borrower represents that the site was purchased 

more than ten years ago on a willing seller/willing buyer basis. 

Therefore PS 5, 6, 7, and 8 are not triggered at this time. 

The Project will be required to meet applicable provisions of the IFC 

Environmental Health and Safety General Guidelines (2007) and the 

EHS Guidelines for Tourism and Hospitality Development (2007). 

Environmental and Social Risks and Mitigation: The Borrower prepared 

an Environmental and Social Impact Assessment to identify and manage 

the environmental and social risks associated with the Project. The 

Project ESIA includes an Environmental Management Plan, Hygiene, 

Health and Safety at Work Plan, and Emergency Response Plan that 

identifies its procedures to ensure a safe and healthy work environment. 

The Borrower will be required to develop and implement a certified 

Life and Fire Master Plan for the Project prior to commissioning.

The Project will have social impacts that must be mitigated in a manner 

consistent with the IFC Performance Standards, DFC’s Environmental 

and Social Policy and Procedures, and applicable local laws. DFC’s 
statutorily required language regarding the rights of association, 

organization and collective bargaining, minimum age of employment, 

and prohibition against the use of forced labor, will be supplemented 

with provisions concerning non-discrimination, hours of work, the 

timely payment of wages, and hazardous working conditions. Standard 

and supplemental contract language will be applied to all workers of the 

Project, including contracted workers. 

The Project has in place appropriate oversight for working conditions 

during construction activities. The Project’s labor management system 

incorporates Marriott International’s corporate social policies, which are 

in alignment with local law and IFC Performance Standards. The 

Borrower will be required to update their human resources system and 

security plan.