The African Development Bank (AfDB) and the European Union (EU) have reaffirmed their commitment to unlock hundreds of millions in financing for African infrastructure and development needs.
Collaboration between the two institutions would focus on de-risking the business environment in Africa, providing equity, guarantees and other types of non-grant support, AfDB President, Dr. Akinwumi, and EU Commissioner, Neven Mimica, said at a news conference held on the sidelines of the Africa Investment Forum in South Africa.
Both men stressed the central role of investment in the transformation of Africa. Mimica said the EU whose goal is to move from billions to trillions in investment over the next decade, was encouraged by the Bank’s recent capital increase.
“The bank is our strategic partner – it important that it is well capitalized,” Mimica said.
The parties spoke on several areas of joint collaboration, including EU commitment for investments in Africa and its role as a major partner of the Africa Investment Forum.
Mimica said the EU would be supporting risk-sharing guarantees of 70 million euros set to unlock hundreds of millions and creating 175,000 jobs. Supporting investments in job creation in alliance with Africa over the next 5 years, the EU would disburse 60 billion euros in one of the largest guarantee funds created, creating 10 million jobs.
“The role of the Bank is crucial, we attach great importance to the alliance,” Mimica said.
Financial support from the EU has enabled the Bank to push through transformative initiatives such as PAGODA, which allows the institution to invest in infrastructure, especially in West Africa. PAGODA has enabled the bank to provide grants to low-income African countries, fragile states, provide concessional loans, technical assistance, equity and guarantees in support of sovereign and non-sovereign projects.
“The EU is the partner of choice for the African Development Bank,” Adesina said, adding that the EU had shown great support to the Bank in renewable energy.
Speaking on the continent’s challenges, Adesina said despite its growing population, Africa was “brimming with hope.”
“The youth don’t need hand outs. They are our assets in which we our financial institutions should invest,” he said.