Industry News5 min read
Navigating Currency Risk in Emerging Market Infrastructure
Why traditional hard-currency project finance models are failing in volatile FX environments, and what the alternatives are.
Posted by
Dr. Emmanuel NwachukwuTheme
FX RISKMACROECONOMICSFINANCE
Key Context
A deep dive into the structural challenges of infrastructure finance in Africa.
Currency depreciation has derailed countless infrastructure projects across emerging markets. When revenues are generated in local currency but debt is serviced in USD, even a minor FX fluctuation can destroy a project's financial model.
We examine the systemic risks of this mismatch and argue that the future of African infrastructure relies on the deepening of local capital markets and the proliferation of local currency financing vehicles.
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Published · June 14, 2025
