The ADF had its highest replenishment in its 50-year history, which will fund grants and soft loans to the continent’s low-income countries for the next three years.
The African Development Fund has raised $8.9bn from international donors to lend and grant to low income countries in the 2023-2025 financing cycle.
The Fund lends on highly concessional terms and provides grants to the less developed members of the Bank, using a performance-based allocation system to ensure efficiency and equity. The support is cheaper than the near-market rates of interest that wealthier African countries pay to access Bank support.
Despite a difficult global economic outlook, with the IMF predicting Sub-Saharan Africa’s growth to slow sharply by more than 1 percentage point to 3.6% in 2022, this year’s replenishment represents a 14.24% increase over the previous cycle’s fundraising of $7.4bn. Akinwumi Adesina, president of the African Development Bank, praised the donor community for the level of support they have mustered.
“I am impressed by the huge commitment and efforts of the ADF donor countries in stepping up support for Africa’s low-income countries, especially at this time of great economic, climate and fiscal challenges. This is the power of global partnerships and effective multilateralism in support of Africa,” he said.
Before the fundraising, Adesina had expressed concern that the Fund’s resources were increasing at a slower pace compared to those of other institutions. Speaking at the opening ceremony before the fundraising announcement, he said that the Fund’s share of overseas development assistance to sub-Saharan Africa declined from 11.4% in the fund’s eighth funding round to just 6.2% for the 2020-22 cycle. However increased contributions from the Fund’s primarily Western donors were boosted by new African contributors Algeria and Morocco. They join existing African donors Angola, South Africa, and Egypt in their support for the Fund.
Credit: Mark-Anthony Johnson