PHOTON International The Photovoltaic Magazine

Microcredit interpretation nearly causes loss of PVMTI funding in Morocco

The first PVMTI project will start as soon as the wording of a Moroccon law on a microcredit financing is changed.

Governmental bureaucracy and banking laws in Morocco nearly caused the International Finance Corporation (IFC) to eliminate funding worth $5 million for the Photovoltaic Market Transformation Initiative (PVMTI) in that country. Terence Hart, manager for PVMTI in Morocco, says Moroccan banks had been interpreting a national law on microcredit financing as not covering solar home systems, thus threatening a number of proposed PV projects. The Moroccan Ministry of Finance has now given assurances, says Hart, that the wording of the law will be changed to include financing for solar electrification »as a productive use,« akin to buying farm animals or cottage industries. »It's enough for our purposes,« says Hart, who is also PVMTI country manager for India and the CEO of IT Power India, the Indian subsidiary of IT Power, a renewable energy consultancy headquartered in the UK. According to another source at PVMTI, IFC had considered transferring the funds to India, which along with Kenya and Morocco is one of the program's target countries. PVMTI offers $25 million in concessional funds from the Global Environment Facility (GEF) for PV projects. Hart would only say that PVMTI had been »making contingency plans« in the event that the negotiations in Morocco fell through. But he now expects all of the PVMTI funding to be used in Morocco.

Last autumn, IFC approved a $1 million GEF grant to a subsidiary of a Moroccan bank to offer small-scale loans through Afrisol S.A., a Casablanca-based PV integrator (see PI 10/2001, p. 12). Three other projects are currently being reviewed by the IFC. PVMTI received a total of seven project proposals in Morocco.