Africa Finance Corporation (AFC) is launching a US$2 billion facility to support recovery and resilience in Africa as a result of the worldwide pandemic and the Russia-Ukraine conflict.
The African Development Bank (AFC) has committed to funding up to half of the new African Economic Resilience Facility and mobilizing the rest through its network of foreign partners and investors. At the AFC Live Infrastructure Solutions Summit, the facility will be revealed.
The facility would be disbursed through AFC loans to selected commercial banks, regional development banks, and central banks in several African countries, providing them with much-needed hard currency liquidity to finance trade and other economic operations.
These institutions will be able to take advantage of AFC’s established worldwide fundraising network to obtain funds at competitive rates.
Speaking on the rationale behind the launch, Head of Treasury and Financial Institutions, Banji Fehintola, said: “The COVID-19 pandemic set back Africa’s economic growth trajectory and widened the trade financing gap, while the Russia-Ukraine conflict has added a further set of challenges negatively impacting growth prospects across the continent. We are determined to play a leading role in helping the continent’s recovery and resilience, not only through the work we do in bridging Africa’s infrastructure gap, but also through targeted interventions such as this US$2billion economic resilience facility.”
The African Economic Resilience Facility will accept applications starting this month on the AFC website. AFC’s development impact in Africa will be accelerated as a result of this funding, assisting the continent in transitioning to a new phase of growth centered on maximum resource value capture and domestic employment creation.
AFC has gained experience mobilizing global funding for important infrastructure projects in Africa over the last 15 years. A recent bond issue by the Corporation was a US$750 million 7-year Eurobond issued in 2021 at AFC’s lowest yield to date. AFC Capital Partners, the Corporation’s independent asset management arm, has ambitions to raise $2 billion to fund climate adaptation infrastructure projects in Africa.
