RxHF provides capital to companies in diagnostics, hospitals and pharmaceutical sectors. The AfDB said that investments will be made in Egypt, Tunisia and Morocco and then scaled up into Ethiopia, Kenya, Nigeria and Sudan.

The AfDB is the first Africa-based institution to participate in the RxHF’s capital raising, for which it is targeting a total $200 million. EFG Hermes Private Equity is partnering with the fund to provide private equity management experience.

The AfDB said in a statement that the target client of the RxHF is the middle-income class that needs specialised high quality, but affordable healthcare service within Africa to benefit from the Fund’s investments geared towards mid-size healthcare facilities. Fifty per cent of Africa’s population is expected to be categorised as middle class by 2020, according to the AfDB.