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CDC’s Africa forestry manager launches Fund II – exclusive

Global Environment Fund is approaching investors ahead of launching GEF African Sustainable Forestry Fund II.

Global Environment Fund (GEF), the US alternative asset manager, is approaching investors ahead of launching GEF African Sustainable Forestry Fund II, according to George McPherson, managing director at GEF. ASFF II is targeting $200 million.

ASFF I closed on $160 million in 2010 after attracting commitments from CDC, the UK-based development finance institution targeting investment into Africa and Southeast Asia, and other DFIs.

For Fund II, GEF expects demand from pension funds from Scandinavia, Europe and the US that are already expressing high levels of interest, according to McPherson. Fund I was launched when Africa was still too risky for this investor base, particularly in the wake of the financial crisis, he added. DFIs are also likely to be present in Fund II, although CDC did not respond to requests for comment.

GEF manages $1 billion of assets overall across the energy, environmental and natural resources sectors.

Existing forestry investments in Africa include Ramanas Farms, an 8,300 hectare plantation forest company certified by the Forest Stewardship Council (FSC) and located in South Africa; Kilombero Valley Teak Company, a teak plantation and saw-milling business located in Southern Tanzania; and Pemba Sun and Mozwood, sustainably-managed tropical hardwood concessions in Mozambique.