IFC approves $12m finance for construction of steel plant in Ghana
The International Finance Corporation (IFC) has approved a US$12 million loan to Rider Iron and Steel Ghana for the construction of a steel manufacturing plant. The steel plant will be located in Kumasi, Ghana’s second largest city.
According to a statement posted on the IFC website, “When complete in 2021, the factory will produce roughly 240,000 tons of steel products annually using mostly locally sourced scrap steel. The plant will increase Ghana’s current production by more than 75 percent.”
The IFC statement said the plant would create about 450 direct jobs and generate more than 13,000 indirect jobs in the value chain, mostly among individuals and micro enterprises engaged in scrap collection. The new plant would operate with an energy efficient induction furnace, and would use steel scrap as the main ingredient, reducing its carbon footprint compared to steel made from iron ore.
“This capital injection from IFC is a game-changer, not just for Rider Steel, but for the industry and Ghana. The loan will propel us to help meet domestic demand and support many other businesses along the way” stated Walid Al Alami, Rider Steel Director.
“We are pleased to support Rider Steel, and contribute to job creation, local skills development, and economic growth in Ghana, especially at a time when the global economy is facing serious challenges” stated Ronke Ogunsulire, IFC Country Manager for Ghana.
Increased domestic steel production from the new plant is expected to reduce imports and help conserve foreign exchange by approximately US$125 million annually at current prices, supporting Ghana’s balance of trade.
Rider Iron and Steel Ghana’s proposed 240,000 tons per annum steel plant is anticipated to be the largest steel manufacturing factory in West Africa, and will be equipped with furnaces for manufacturing structural material such as rebar steel, angle steel, C channels, I beams among others.
Rider Industries is a privately held, global corporation that operates throughout Europe, Middle East, and Africa.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets and has reportedly provided over US$4 billion dollars of financing and advisory services in Ghana for agribusiness, education, energy, transport, tourism, and other sectors over the past 10 years.
Photo: Map of Ghana (Rosevite2000 | Dreamstime)