CIB announces equity-funding initiative for Indigenous communities
The Canada Infrastructure Bank (CIB) has unveiled details of a new funding initiative that it says will support First Nation, Métis and Inuit communities in purchasing equity ownership stakes in infrastructure projects within their traditional territories that the CIB is also investing in.
The CIB’s new Indigenous Equity Initiative will provide equity loans of $5 million and $100 million for up to 90% of Indigenous equity interest, with repayment terms of 15 years at minimum Government of Canada interest rates.
In so doing, the initiative aims to close a market gap by providing access to capital currently unavailable for most Indigenous communities, help support the federal government’s objective of reconciliation and economic inclusion of Indigenous communities and peoples, and accelerate the delivery of key infrastructure projects.
Indigenous equity participation across CIB’s five priority sectors is expected to involve projects such as clean electricity transmission, battery storage, electricity generation and infrastructure to support critical mineral development.
Through the initiative, the CIB will look to lend to Indigenous communities to provide them with access to capital to purchase equity stakes in infrastructure projects in which the CIB is also investing. Economic returns from these projects can be reinvested in the community, narrowing the economic and infrastructure gap among Indigenous communities.
Indigenous communities often lack access to capital in order to purchase equity stakes and be active participants in infrastructure developments. Market lenders are often unwilling to lend to Indigenous communities against these equity stakes.
“The CIB’s plan to offer Indigenous equity is designed to help First Nation, Métis and Inuit communities to purchase ownership stakes in key infrastructure projects,” said CIB CEO Ehren Cory. “We look forward to delivering on this initiative and expanding our mandate so we can get more infrastructure built faster and increase Indigenous economic partnership.”
The CIB is currently investing in a number of projects on traditional First Nation, Métis and Inuit territories, including the Atlin Hydroelectric Expansion in British Columbia and the Yukon, Enoch Arena Road in Alberta, Georgina Island Fixed Link in Ontario, Tshiuetin Railway in Quebec and Labrador, and Grasswoods Urban Reserve Wastewater Treatment Facility in Saskatchewan.
Providing equity loans to Indigenous communities is part of the CIB’s commitment to invest at least $1 billion in Indigenous infrastructure.