ABUJA, Nigeria: In response to economic challenges created by the global pandemic and the Russia-Ukraine conflict, Africa Finance Corporation (AFC) is launching a US$2billion facility to support recovery and resilience in Africa.
AFC has committed to funding up to 50% of the new African Economic Resilience Facility and mobilising the remainder through the Corporation’s network of international partners and investors. The facility will be announced at the AFC Live Infrastructure Solutions Summit today.
The facility will be disbursed through loans from AFC to selected commercial banks, regional development banks and central banks in various African countries, providing them with much needed hard currency liquidity to finance trade and other economic activities in their jurisdictions. These institutions will be able to leverage AFC’s proven access to global funding to receive financing 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 though the work we do in bridging Africa’s infrastructure gap, but also through targeted interventions such as this US$2billion economic resilience facility.”
Applications for the African Economic Resilience Facility will open this month through AFC’s website (www.africafc.org). Through this funding intervention, AFC will accelerate its developmental impact in Africa, helping to drive the continent to a new phase of growth that is focused on maximum resource value capture and domestic job creation.
Over the last 15 years, AFC has built experience mobilising global capital for critical infrastructure projects in Africa. The Corporation’s recent bond issues include a US$750million 7-year Eurobond issued in 2021 at AFC’s lowest yield to date. The Corporation also established an independent asset management arm, AFC Capital Partners, with plans to raise US$2 billion to fund climate adaptation infrastructure projects in Africa.