AfDB, AFD sign five-year deal to expand infrastructure financing across 14 African countries

The African Development Bank Group (AfDB) and Agence Française de Développement (AFD) have signed a new five-year memorandum of understanding (MoU) to bolster infrastructure financing across 14 African nations, spanning from 2026 to 2031. This agreement, signed on November 10 during the Paris Peace Forum, aims to augment the collaboration initiated in 2021, which has already facilitated 17 jointly financed projects in the region.

The memorandum seeks to fortify cooperative efforts from the project's inception, extending to financing and execution phases. Both institutions intend to broaden the portfolio of investment-ready ventures throughout the continent. The partnership entails joint appraisal of prospective projects, amalgamation of financing with project preparation, technical guidance, policy deliberations, and capacity enhancement.

Additionally, it aims to fortify collaboration on project administration, oversight, and knowledge dissemination.

Key priority domains encompass infrastructure development, bolstering African supply chains, fostering employment for the youthful populace, and industrial expansion. AfDB President Dr Sidi Ould Tah highlighted that the alliance would direct resources towards indispensable infrastructure, energy, transport, and industrial development, aiding long-term economic expansion.

AFD Group Chief Executive Officer Christophe Lecourtier emphasized the pact as a significant stride in the entities' relationship, targeting strategic infrastructure, especially in energy and transport, alongside industrial advancement and enduring economic prosperity.

The accord also encompasses deeper cooperation on hybrid finance, guarantees, catalytic finance, and carbon finance to allure supplementary public and private investments. Both parties will investigate entry into European financial instruments and co-financing mechanisms involving European stakeholders and African partners.

This new collaboration builds upon a relationship that was initially formalized in 2008 and subsequently renewed in 2021. France has been a part of the African Development Fund, the concessional financing window of the Bank Group, since 1977 and formally joined the African Development Bank in 1983. Energy has constituted nearly half of the entities' pooled financing since 2021, and AFD has pledged €1 billion to Mission 300, an initiative of AfDB and the World Bank, aiming to connect an additional 300 million individuals in sub-Saharan Africa to electricity by 2030.

Jointly financed endeavors under this agreement include the Nigeria Digital and Creative Enterprises program, alongside the Single Window for SME Development and the Diversification, Accelerated Industrialisation, Competitiveness, and Employment initiative in Côte d'Ivoire. Support for South Africa's biopharmaceutical firm Biovac in expanding its local vaccine production and pharmaceutical manufacturing capacities is also included.

The new agreement complements AfDB's ongoing financing initiatives in Nigeria, encompassing aid for businesses, women-led enterprises, and economic overhauls.