Cairo, 19 August 2020: – On July 2nd 2020, Agence Française de Développement (AFD) and the African Export-Import Bank (AfreximBank) have announced a new facility agreement for a EUR 150 Million financing program to support Afreximbank in the implementation of its new climate finance strategy which will target green, low carbon, socially inclusive and more resilient investments across Africa. As part of its financing program, AFD has made available a EUR 500,000 grant to carry out a technical assistance program which will support Afreximbank in developing its sustainable finance strategy. By doing so, this strong partnership between the two institutions will promote through Afreximbank and its partnering institutions, the dissemination of innovative financing mechanisms for the sustainable development of the African continent.
As the continent commence the implementation of the African Continental Free Trade Agreement (AfCFTA) early next year, it is timely to unlock new funding arrangements to finance sustainable projects and sectors that build Africa’s long-term competitiveness and resilience. It is estimated that the climate change is impacting negatively on Africa’s GDP by 2.8% every year (around USD 100 billion). In order to tackle the climate change challenges in Africa, financing solutions have to be developed not only through external financial flows but also through the development of specific and more appropriate instruments that fosters sustainable development. To this end, making financing available for climate finance and sustainable development in Africa is considered a priority by both institutions.
Against this backdrop, accelerating investments in key channels for climate and pandemic resilience in the continent is a top priority for Afreximbank: ensure food security by strengthening agricultural value chains, increase access to water and sanitation, improvement of living conditions of people, job creation through investments in resilient infrastructure, ensure the availability of affordable and sustainable source of energy for all, support the creation of world class medical facilities and pharmaceutical industries, are some of the main development challenges to tackle ahead. The new partnership signed on July 2nd, 2020, between AFD and Afreximbank aims at contributing to the development of such solutions.
The agreements were signed by the Executive Vice-President of the African Export-Import Bank, Mr. Amr Kamel, with Dr. Fabio Grazi, Director of AFD Country Office for Egypt.
Speaking during the signing ceremony, Amr Kamel, Executive Vice President, Business Development and Corporate Banking at Afreximbank, said that the facility signed with AFD was a huge opportunity for climate finance for African countries. “It will create value from environmental assets and promote climate friendly investments to support African governments and African companies in their pursuit of infrastructure investments and will sustain their social and economic development.”
On the occasion of the signing, Dr. Fabio Grazi indicated that “Today’s agreement reaffirms AFD’s and Afreximbank’s commitment to propel the strategic partnership between our two institutions to new heights in support of Africa’s sustainable and inclusive economic development. The signing of this new agreement bases upon the shared vision that mainstreaming climate change and sustainable development goals into Africa’s financial sector is critical to tackle the challenges ahead and realize the opportunities available for the African continent.”
Background information
Since 2015, the relationship between AFD and Afreximbank grew and gradually turned into a partnership based on a community of objectives and interests for the sustainable development of the African economy. As a whole, the partnership between AFD and Afreximbank amount up to EUR 450 M. First, the partnership was focusing on promoting the competitiveness and diversification of African exports, enhance African exports, foster the insertion of local content and the creation of value chains and regional trade integration. Today, it is a new step in this partnership which focuses more on mainstreaming climate-friendly and social inclusive financing solutions across the continent. The next step of this partnership will be materialized at the “Finance in Common” Summit organized in November, 2020 in the context of the Paris Peace Forum (11-13 November) which will gather for the first time 450 Public Development Banks from all over the world as well as their stakeholders and partners, and to which Afreximbank will participate. This Summit will aim at promoting synergies and partnerships between Public Development Banks (PDB) and will stress their crucial role in reconciling short-term countercyclical responses to the crisis with sustainable recovery measures that will have a long-term impact on the planet and societies. An opportunity for the two institutions to share experience and promote their climate action on the continent.
About the African Export Import Bank (Afreximbank)
The African Export-Import Bank (Afreximbank) is a Pan-African multilateral financial institution with the mandate of financing and promoting intra-and extra-African trade. Afreximbank was established in October 1993 and owned by African governments, the African Development Bank and other African multilateral financial institutions as well as African and non-African public and private investors. The Bank was established under two constitutive documents, an Agreement signed by member states, which confers on the Bank the status of an international organization, and a Charter signed by all Shareholders, which governs its corporate structure and operations. Afreximbank deploys innovative structures to deliver financing solutions that are supporting the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby sustaining economic expansion in Africa. At the end of 2019, the Bank’s total assets and guarantees stood at USD$15.5 billion and its shareholders funds amounted to US$2.8 billion. Voted “African Bank of the Year” in 2019, the Bank disbursed more than US$31billion between 2016 and 2019. Afreximbank has ratings assigned by GCR (international scale) (A-), Moody’s (Baa1) and Fitch (BBB-). The Bank is headquartered in Cairo, Egypt.
For more information, visit: www.afreximbank.com.
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About Agence Française de Développement (AFD)
Headquartered in Paris, AFD is an inclusive public financial institution and the main actor in France’s development policy. It makes commitments to projects that genuinely improve the everyday lives of people, in developing and emerging countries and in the French overseas territories. AFD works in many sectors – energy, health, biodiversity, water, digital technologies, training – and supports the transition to a safer, more equitable and more sustainable world: a world in common. Its action is fully aligned with the Sustainable Development Goals (SDGs) and with the Paris Agreement on climate. Through its network of 85 local agencies, AFD operates in 109 countries and is currently supporting over 3,600 development projects. In 2018, it earmarked EUR 11.4bn to finance these projects. The Agency is rated AA (Fitch Ratings) – stable outlook. www.afd.fr
Press Contacts:
AFD Communication Officer: Laila Shaker – shakerl@afd.fr; +202 27 35 17 88
Afreximbank: Amadou Labba Sall – asall@afreximbank.com; +20 120 532 0254