Development partners of the African Development Fund (ADF) have agreed to commit a total package of US$8.9bn to its 2023 to 2025 financing cycle, the largest replenishment in the history of the fund which helps low income African economies.
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The commitment comes despite a difficult global outlook and a year of intense negotiations.
ADF is the concessional window of the African Development Bank Group (AfDB), providing grants and soft loans to the continent’s low-income countries.
The US$8.9bn replenishment package includes US$8.5bn in core ADF funding and US$429m for the newly created Climate Action Window, AfDB said.
ADF-16 core funding represents a 14.24% increase over ADF-15 of US$7.4bn and is seen as 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, the effects of climate change, fragility, debt, and economic vulnerabilities.
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 Kingdom of Morocco hosted the fourth and final meetings of the new replenishment (ADF16).
African Development Bank Group president Akinwumi Adesina (pictured) applauded the impressive funding package to support low income countries.
“This is the power of global partnerships and effective multilateralism in support of Africa,” Adesina said.
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.
“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 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,” Adesina said, adding that 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.”
ADF has in the past comes to Zimbabwe’s rescue despite the southern African nation owing the AfDB.
In July, Zimbabwe received a US$25.56m grant from the ADF to enhance domestic food production. The grant will see the distribution of seed and fertilisers to 180000 beneficiaries.
The funds were drawn from the African Development Fund’s Transition Support Facility with the AfDB board providing a waiver to assist Zimbabwe to mitigate against a possible food crisis.
