51169 - CATALYST MENA CLIMATE FUND 2

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Summary of Investment Information

Project Number

51169

Company Name

CATALYST MENA CLIMATE FUND 2

Date SPI Disclosed

Nov 11, 2025

Country

Middle East, Pakistan, and Afg Region

Region

Middle East

Projected Board Date

Jan 29, 2026

Environmental Category

FI-1 - Significant

Status

Pending Signing

Last Updated Date

Mar 17, 2026

Department

Regional Industry INF MCT

Industry

other

Previous Events

Approved : Mar 13, 2026

Sector

Infrastructure Fund

Project Description

The proposed investment involves an equity participation into Catalyst MENA Climate Fund II (CMCF2 or the Fund) to be established by Catalyst Investment Management (Catalyst MENA). CMCF2 would be the second infrastructure fund established by Catalyst MENA following the successful raise of US$57 million in Catalyst MENA Clean Energy Fund I (CMCF1), an infrastructure fund launched in 2016.

The Fund's target size is US$150-200 million with a first close target of US$70-85 million. It will focus on climate mitigation, climate adaptation and energy transition themes in the form of inter alia renewable energy infrastructure, energy storage, energy efficiency and water-related projects across the Middle East and North Africa (MENA), with a primary focus on Jordan, Egypt, Tunisia and Morocco.

Associated Advisory Engagement

The Sustainable Infrastructure Advisory (SIA) team has commenced discussions with the client regarding a potential engagement that would build on CMCF2's expressed interest in enhancing sustainability and gender-lens investing. The proposed activities will leverage SIA's experience in the region and include an in-depth Technical Assistance component focusing on Social Inclusion (Fund Level), and a Sustainability Accelerator centered on Capacity Building and Peer Learning.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	25.0

Development Impact

The expected project-level outcomes include Greenhouse Gas (GHG) emissions mitigation through displacing more carbon-intensive and expensive power sources, as well as implementing energy-efficient solutions. At the market level, the Project is expected to strengthen the climate finance ecosystem in MENA by promoting climate-focused equity instruments that support sustainability outcomes and power sector resilience in the target markets.

IFC’s equity investment of up to US$15 million in CMCF2 will enable the Fund to expand into new markets with growing demand for greenfield renewable energy projects, while also helping mobilize third-party investors toward its US$150–250 million target. Beyond financing, IFC’s involvement will enhance the Fund’s capacity and credibility through potential advisory support on gender and social inclusion, strengthening investor confidence in high-risk markets through its due diligence and long-term commitment to renewable energy, and promoting good environmental and social risk management practices aligned with IFC Performance Standards (PS), including development of an E&S management system (ESMS).

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
Renewable Energy Generated	GWh		Not Available	Not Available	Not Available
Renewable Energy Installed Capacity	MW		Not Available	Not Available	Not Available

E&S Category Rationale / Risks and Mitigation

CMCF2 is an infrastructure fund seeking to invest primarily in renewable energy (RE) sub-projects. These climate investments include early-stage, construction, and operation of solar PV sub-projects in MENA with a primary focus on Jordan, Egypt, Tunisia and Morocco. Other climate-related investments may include energy storage, energy efficiency and water-related sub-projects. It is considered that such infrastructure sub-projects may have significant adverse environmental and social risks and potential impacts, particularly in relation to occupational health and safety, supply chain management, biodiversity, involuntary resettlement, or stakeholder engagement. Therefore, the Project has been categorized as FI-1 according to IFC's Policy on Environmental and Social Sustainability. The Fund will not support any activities in the IFC Exclusion List or coal-related sub-projects. Applicable E&S requirements for the Project include the applicable E&S local laws and IFC Performance Standards. The Fund will be required to publicly disclose its Category A and Category B sub-projects on a yearly basis, including subproject names, sector and locations. Additionally, the Fund itself will maintain alignment with the requirements of IFC’s Performance Standard 2 on Labor and Working Conditions.

Catalyst MENA has an appointed part-time E&S Officer, and a comprehensive ESMS aligned with IFC Performance Standard 1 requirements. The ESMS procedures cover the Fund's investment activities and describe the implementation process including project screening, categorization, as well as procedures for conducting E&S due diligence (ESDD) and environmental and social impact assessment (ESIA). The ESMS also includes screening procedures for country level E&S risks, E&S red-flags, solar supply chain management, as well as risks of sexual exploitation and harassment (SEAH) applicable to direct sub-project employees, contractors and local communities. The ESDD process includes conducting site visits during pre-construction, construction, and operation phases as part of asset management activities, including verifying compliance with environmental permits, stakeholder engagement and grievance mechanisms, labor practices in line with national labor laws and international standards, waste management, emissions, and resource efficiency. The Fund also requires all suppliers and contractors involved in project development and operation to demonstrate compliance with applicable environmental, health, and safety (EHS) regulations of the host country. Qualified external consultants undertake ESDDs for Category A and other higher-risk sub-projects. E&S monitoring is undertaken internally primarily focusing on the implementation of mitigation measures as specified in the Environmental and Social Action Plans (ESAPs) for each sub-project in the portfolio, and in line with IFC PS requirements.

For this Project, the Fund manager will appoint a full-time ESG Lead and will add an additional E&S officer as the portfolio grows.

Additional ESMS enhancements include the following items: (i) integrate procurement procedures in line with the IFC's supply chain screening tool for forced labor; (ii) develop separate internal grievance policy and external communication mechanism to align with IFC PS requirements; (iii) update the Fund’s (EHS) Policy, to align with World Bank Group EHS General Guidelines and applicable sector-specific guidelines. CMCF2 will support portfolio companies with establishing an ESMS relevant to its development stage (construction or operation) in line with IFC PS 1.

S.no	Title	Anticipated Completion Date
1	Update E&S Management System (ESMS)	02/26/2026
2	Appoint an E&S Officer	02/12/2026
3	Update the Grievance Mechanism	02/26/2026
4	Prepare an E&S Management System (ESMS) Training Plan	02/26/2026
5	Implement Staff Training on the ESMS implementation	04/26/2026
6	Update HSE Policy	02/26/2026
7	Enhance Contractor Management procedure	02/26/2026

Contacts

For Inquiries About the Project, Contact

Catalyst Investment Management
+962 6 592 1747
info@catalystpe.com
Zahran Street 213, Zahran Tower, 6th Circle, Amman 11821 Jordan
https://catalystpe.com/

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