African Development Fund to Provide Continent's Poorest Countries With Record $8.9 Billion

The African Development Fund celebrates its 50th year anniversary this year. It was established in 1972 as part of the African Development Bank Group by the Organization of African Unity, which is the predecessor of the modern African Union.

Africa's lowest-income countries are to receive some $8.9 billion from the African Development Fund (ADF), the concessional window of the African Development Bank Group (AfDB), within the framework of ADF-16 funding program. The decision was announced in a statement on the AfDB website following the pledging meeting in Morocco.

“After a year of intense negotiations and a difficult global economic outlook, development partners of the African Development Fund (ADF) have agreed to commit a total package of $8.9 billion to its 2023 to 2025 financing cycle. It is the largest replenishment in the history of the Fund,” the institution said.

African countries that contributed to the fund are Angola, Egypt, South Africa, Algeria and Morocco – the latter two joined this year.

According to the fund, the initiative is aimed to support “recovery from the COVID-19 pandemic, the effects of climate change, fragility, debt, and economic vulnerabilities”. Around $429 million of the total amount is designated for the newly-created Climate Action Window.

The two declared priorities of ADF-16 are the development of sustainable, climate-resilient and quality infrastructure, as well as governance, capacity building and sustainable debt management. Another key goal is the empowerment of women.

The fund declared that due to its help over the past five years, 15.5 million people were connected to electricity, 74 million people gained access to improved agriculture, 42 million to water and sanitation, and 50 million people have improved transport.

The ADF-16 will continue delivering support in these spheres, with plans to connect 20 million more people to electricity, improve agriculture for the benefit of 24 million people, give 32 million people access to water, as well as sanitation and better access to transport for another 15 million Africans.

Akinwumi Adesina, president of the AfDB, praised the ADF-16 initiative, noting that it will advance sustainable development goals and the Agenda 2063 of the African Union.

“I am impressed by the huge commitment and efforts of the ADF donor countries in stepping up support for Africa’s low-income countries, especially at this time of great economic, climate and fiscal challenges. This is the power of global partnerships and effective multilateralism in support of Africa,” he said.

Earlier, Adesina declared that the AfDB secured $31 billion in investment commitments for projects during the November Africa Investment Forum, thus taking the yearly investment to nearly $64 billion.

According to Adesina, Africa “is not as risky as you think” in terms of investment; however, he noted, the continent's development is halted by a biased perception of its investment climate.

Previously, the AfDB president also pointed out energy poverty as one of the central problems for Africa’s progress, denouncing calls to reduce fossil fuel development on the continent as part of the green agenda.