Economy

AFC launches U.S. $2bn facility for economic recovery, resilience in Africa

AFC launches U.S. $2bn facility for economic recovery, resilience in Africa
Written by Maritime First

Africa Finance Corporation (AFC) is launching a two billion dollar facility to support recovery and resilience in Africa.

This is in response to the economic challenges caused by the global pandemic and the Russia-Ukraine conflict.

This is contained in a statement signed by Marlynie Moodley, Senior Vice President, Communications, AFC, in Abuja on Thursday.

Moodley said AFC has committed to funding up to 50 per cent of the new African Economic Resilience Facility and mobilising the remainder through the Corporation’s network of international partners and investors.

She said the facility would be announced at the AFC Live Infrastructure Solutions Summit held on Thursday (Today) in Abuja.

Moodley said the facility will be disbursed through loans from AFC to selected commercial banks, regional development banks and central banks in various African countries.

She said this would provide them with the 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.”

The statement quoted the Head of Treasury and Financial Institutions, Banji Fehintola, as saying “The COVID-19 pandemic set back Africa’s economic growth trajectory and widened the trade financing gap.

Fehintola said that the Russia-Ukraine conflict had 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 through the work we do in bridging Africa’s infrastructure gap.

“But also through targeted interventions such as this two billion dollars economic resilience facility.”

Moodley said applications for the African Economic Resilience Facility would open this month through AFC’s website (www.africafc.org).

She said through the funding intervention, AFC would accelerate its developmental impact in Africa,
Moodley added that this would help to drive the continent to a new phase of growth that focused on maximum resource value capture and domestic job creation.

She said over the last 15 years, AFC has built experience mobilising global capital for critical infrastructure projects in Africa.

Moodley added that the corporation’s recent bond issues included a 750 million dollars 7-year Eurobond issued in 2021 at AFC’s lowest yield to date.

She said the corporation also established an independent asset management arm, AFC Capital Partners, with plans to raise two billion dollars to fund climate adaptation infrastructure projects in Africa.

Moodley said AFCAFC was established in 2007 to be the catalyst for private sector-led infrastructure investment across Africa.

It is the second highest investment grade rated multilateral financial institution in Africa.

AFC’s approach combines specialist industry expertise with a focus on financial and technical advisory, project structuring, project development and risk capital to address Africa’s infrastructure development needs and drive sustainable economic growth.

She said AFC invested in high-quality infrastructure assets that provided essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport, and telecommunications.

To date, the corporation had invested 10 billion dollars in projects across 35 African countries.

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Maritime First