AFC Capital Partners (ACP), the asset management arm of Africa Finance Corporation (AFC), said on Monday it has launched the Infrastructure Climate-Resilient Fund Nigeria (ICRF Nigeria), a vehicle aimed at channelling domestic institutional money into climate-resilient infrastructure projects.

The fund, registered with Nigeria’s Securities and Exchange Commission as a closed-end vehicle, will seek capital from pension fund administrators, insurers and asset managers, ACP said in a statement.

ICRF Nigeria is a domestic sub-fund of ACP’s broader $750 million Infrastructure Climate-Resilient Fund (ICRF), which invests in infrastructure across the African continent while building climate resilience into projects from planning through construction and operation.

The Infrastructure Climate-Resilient Fund has already drawn commitments from a mix of global and African investors, according to the statement. The Green Climate Fund (GCF) has pledged $253 million in first-loss capital, its largest equity investment in Africa to date.

Other backers include the European Investment Bank, the Development Bank of Southern Africa, Italy’s Cassa Depositi e Prestiti, the Nigeria Sovereign Investment Authority and several African pension funds.

ACP said it expects to raise up to $3.7 billion in total financing through the fund and to build a portfolio of 10 to 12 infrastructure projects across the continent.

Nigeria’s institutional investors, particularly pension funds, hold large pools of long-term capital that have traditionally been directed toward government bonds and other low-risk instruments rather than infrastructure.

Samaila Zubairu, AFC’s president and chief executive, said Africa’s constraint was not a shortage of capital but how it is deployed.

“Africa is not short of capital,” Zubairu said in the statement, adding that the continent holds more than $4 trillion in domestic resources, including pensions, insurance funds and sovereign wealth. He said too much of that money remains parked in short-term instruments rather than being invested in infrastructure, industry and innovation.

“ICRF Nigeria is an important step in that direction, enabling Nigerian institutional capital to participate in the infrastructure that will drive more resilient and sustainable growth across Nigeria and the continent,” he said.

Ayaan Adam, ACP’s chief executive, said the new vehicle gives Nigerian institutional investors direct access to climate-resilient infrastructure assets.

“ICRF Nigeria gives Nigerian institutional investors a dedicated route into high-quality, climate-resilient infrastructure investments across Nigeria and Africa,” Adam said, adding that combining institutional capital with AFC’s project expertise and blended finance would help address both financing gaps and climate-related risks.

The broader Infrastructure Climate-Resilient Fund blends concessional and commercial capital, using de-risking mechanisms intended to draw private investment into projects that might otherwise struggle to secure financing, according to ACP.

The fund is targeting renewable energy, transport and logistics, digital infrastructure and industrial development, sectors ACP described as central to Africa’s economic transformation.

Each prospective investment will undergo climate risk screening, assessing both physical risks — such as exposure to extreme weather — and transition risks tied to emissions pathways and climate policy, the statement said.

The Green Climate Fund’s first-loss commitment and technical assistance are intended to reduce risk for other investors and help attract further institutional capital into the fund, ACP said.

AFC, a Lagos-based multilateral finance institution established in 2007, has 48 member countries and says it has invested more than $20 billion across 36 African countries since its founding.

The corporation has been active in raising capital and structuring large financings in recent months. Earlier this month, AFC said it had led a $2.5 billion private placement tied to Dangote Petroleum Refinery and Petrochemicals, and it also raised a 350 million Swiss franc digital bond, which it described as the largest such issuance in the Swiss market.

ACP, AFC’s asset management subsidiary, is registered in Mauritius and Nigeria and holds an SEC fund manager licence in Nigeria. It was set up to convert AFC’s project origination and investment track record into products for third-party investors.

ICRF Nigeria marks ACP’s latest attempt to widen its investor base beyond multilateral and development finance institutions to include domestic pension and insurance capital, which regulators in Nigeria have in recent years sought to direct toward long-term productive assets.