The Canada Infrastructure Bank plans to invest C$1.5 billion ($1.1 billion; €955 million) over the next three years in agriculture irrigation projects.
The bank’s outlay is part of a larger C$10 billion growth plan in response to the economic downturn caused by covid-19, which includes investments in areas such as renewable energy, zero emissions public transport and broadband connectivity.
“CIB’s investments will focus on transformative irrigation infrastructure projects that are high priorities for Western Canada,” a CIB spokesman told Agri Investor in an email.
“The benefits of this new initiative include the addition of an estimated 700,000 acres of newly irrigated land, increased food output, improved water resource management, more secure domestic food supply and export opportunities.”
Approximately 60,000 jobs are expected to be created across the breadth of the growth plan’s investments, which includes an additional C$500 million earmarked for project development and early construction works.
CIB chair Michael Sabia said in a statement the initiative is intended to catalyze additional investment from private and institutional investors.
“The CIB’s investments in irrigation will help to mitigate private sector lenders’ concerns with the risks associated with financing projects that involve uncertain ramp-up periods and higher risk repayment sources, due to exposure to commodities pricing associated with revenues from agricultural products,” the bank’s spokesman told Agri Investor.
“Preliminary estimates suggest that completed critical irrigation projects could also help stimulate an additional C$1.5 billion in investment by users for ‘on-farm works’ and associated precision/smart technology for more efficiency.”
Canadian pension Caisse de dépôt et placement du Québec recently partnered with venture capital firm S2G Ventures, to create a co-investment vehicle that will invest $125 million over the next three years in sustainable food and ag companies.
And during the summer, Canada Pension Plan Investment Board’s Thematic Investing Group, established in 2016 to make future-proofed investments, deployed capital for the first time into an agtech company from its newly created Climate Change Opportunities strategy.