African Development Fund mobilizes $8.9 billion for Africa’s low-income countries, the highest in its 50-year history
After a year of intense negotiations and a difficult global economic outlook, development partners of the African Development Fund (ADF) have agreed to commit a total package of $8.9 billion to its 2023 to 2025 financing cycle. It is the largest replenishment in the history of the Fund. ADF is the concessional window of the African Development Bank Group, providing grants and soft loans to the continent’s low-income countries.
The $8.9 billion replenishment package includes $8.5 billion in core ADF funding and $429 million for the newly created Climate Action Window.
ADF-16 core funding represents a 14.24% increase over ADF-15 of $7.4 billion. It is a strong endorsement of the African Development Fund and its impact in tackling the continent’s multiple development needs including recovery from the Covid-19 pandemic, effects of climate change, fragility, debt, and economic vulnerabilities.
During the meetings, Algeria and Morocco contributed to the Fund for the first time. They join Angola, Egypt, and South Africa, on the list of contributing African countries. The fourth and final round of meetings of the new replenishment (ADF-16) was hosted by the Kingdom of Morocco.
ADF deputies applaud after the announcement of ADF-16 replenishment package
An elated President of the African Development Bank Group, Akinwumi Adesina applauded the impressive funding package: “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.”
This replenishment comes as the African Development Fund celebrates its 50th year anniversary since its establishment in 1972. The Fund is achieving significant impacts and in the past five years alone it has helped to connect 15.5 million people to electricity, 74 million people to access improved agriculture, 42 million to access water and sanitation and 50 million people with access to improved transport, including building and rehabilitating 8,700 kilometers of roads.
The ADF-16 will support two strategic framework and operational priorities: developing sustainable, climate-resilient and quality infrastructure; and governance, capacity-building and sustainable debt management in recipient countries. It will also focus on empowering women and girls as a condition for achieving inclusive and sustainable development.
The ADF-16 replenishment will deliver even more impacts over the next three years. It will help to connect 20 million people to electricity, 24 million people will benefit from improvements in agriculture, access to water and sanitation for 32 million people, and improved access to transport for 15 million people.
Adesina, commenting further said: “These are impressive development impacts. These expected impacts of the ADF will advance the Sustainable Development Goals and the Agenda 2063 of the African Union. They will allow the African Development Fund to build on its reputation as being ranked as the second-best concessional financing institution in the world. We will deliver more, better, efficiently and in partnerships with bilateral and multilateral partners. We will foster a climate-smart, resilient, inclusive, and integrated Africa”.
“African low-income countries are the most vulnerable and least prepared to tackle climate change. The Climate Action Window and the commitment to provide 40% of the core financing of the ADF-16 replenishment towards climate finance will help to build climate resilience in Africa”, said Adesina.
