AfDB in $253m loan donor loan agreement with France
The Africa Development Bank (AfDB) has signed a concessional donor loan agreement with France to the tune of $ 253 million as support for the 14th replenishment of the African Development Fund (ADF).
Established in 1972, the ADF represents an enduring development partnership between African countries and donors. The Fund is part of the African Development Bank Group and helps to improve the lives of millions of people across Africa through loans and grants to projects and programmes.
Its resources are replenished by donors every three years. The 14th replenishment is intended to mobilize the funds necessary for the period 2017 to 2019.
The acting Vice-President for Finance and Chief Financial Officer at the African Development Bank, Hassatou N’Sele, signed the ADF concessional donor loan agreement with the Deputy Chief Executive Officer of Agence Française de Développement (AFD), Jean-Pierre Marcelli, in Paris.
The Agence Française de Developpement negotiated and signed the loan agreement on behalf of the French Treasury as part of the contributions of France to the Fourteenth Replenishment of the Resources of the African Development Fund (ADF-14).
The move by France is the first time a donor country would sign a concessional donor loan agreement for the ADF since the Fund management and donors agreed in November 2016 to include a loan component within its financing framework.
Global support for the ADF 14 cycle will help the African Development Bank to continue to deliver very concrete developmental impacts across each of the High 5 areas (Light up and Power Africa, Feed Africa, Industrialize Africa, Integrate Africa, and Improve the quality of life for the people of Africa).
Two other countries have also agreed to provide similar loan supports for ADF 14: Japan (US $ 700m) and India (US $ 15m).
The signature of the loan agreements with Japan and India should take place early in 2018, N’Sele said.
Also, AfDB achieved a 100 per cent investment in renewable energy in 2017.
According to the President of the bank, Dr Akinwumi Adesina, the is a major landmark in the commitment to clean energy and efficiency.
Power generation projects with a cumulative 1,400 megawatts exclusively from renewables were approved during the year, with plans to increase support for renewable energy projects in 2018 under the New Deal on Energy for Africa.
Adesina said: “We are clearly leading on renewable energy. We will help Africa unlock its full energy potential, while developing a balanced energy mix to support industrialization. Our commitment is to ensure 100% climate screening for all Bank financed projects.’’
The share of renewable energy projects as a portion of the Bank’s portfolio of power generation investments increased from 14 per cent in 2007-2011, to 64 per cent in 2012-2016.
The Africa Renewable Energy Initiative (AREI) whose goal is to deliver 300 Gigawatts (GW) of renewable energy in 2030 and 10 GW by 2020, is now based within the Bank, as requested by African Heads of State and Government.
The G7 has promised to commit US$10 billion to support the initiative, which came out of COP21 and subsequently approved by the African Union.
On November 8, 2017, the African Bank Group approved its Second Climate Change Action Plan, 2016-2020 (CCAP2) as a clear message of its commitment to helping African countries mobilize resources to support the implementation of the Intended Nationally Determined Contributions of Regional Member Countries, in ways that will not hinder development.
The approval of the action plan echoes discussions at COP23 in Bonn, Germany to strengthen the global response to the threat of climate change and achieve the Paris Agreement’s goal of keeping global temperature rises to 1.5C.
The CCAP2 is designed to incorporate the Bank’s High 5 priorities in the Paris Agreement, the 2030 development agenda, the Bank’s Green Growth Framework and the lessons learned in the implementation of the first climate change action plan (CCAP1), 2011-2015
In another development,
as part of its wider mandate under the New Deal on Energy for Africa, the Board of Directors of the African Development Bank on December 15, 2017, approved an investment of US $20 million in the Evolution II Fund −a Pan-African clean and sustainable energy private equity fund.
The bank’s investment in Evolution II Fund reflects the High 5 development priorities of the bank, the agenda to light up and Power Africa, and the Bank’s commitment to promote renewable energy and efficiency in Africa.
Ganiyu Obaaro, with Agency Report
