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Tag: AfDB

  • AfDB approves $15m equity fund for SMEs

    The Board of Directors of the African Development Bank has approved a $15 million equity investment in Verod Capital Growth Fund III, a private equity fund that will make investments in high growth middle market companies in Anglophone West Africa including Nigeria, Ghana, Liberia, Sierra Leone and the Gambia.

    The Fund’s investments will be in companies in consumer driven sectors including light industrials, fast moving consumer goods, education, financial services and agro processing. The ticket size for each investment will be between $ 5 million and $20 million.

    “The Fund will help accelerate investments in small and medium scale enterprises (SMEs) in the West African region. This is key to job and wealth creation, knowledge transfer and scaling up of local businesses,” said Abdu Mukhtar, the African Development Bank’s Director of Industrial and Trade Development. He also added: “The Fund will provide an important vehicle to growing SMEs in Africa, which are a key pillar to the continent’s industrialization drive”.

    The Fund Manager, Verod Capital Partners, is an experienced indigenous private equity firm with extensive knowledge of the Anglophone West Africa market. It also possesses a strong record of accomplishment in SME investments. Since 2008, Verod Capital Partners has invested in 16 SME companies in the region.

     

    The Fund’s target size is $150 million.

    Verod Capital Growth Fund III will have a direct and measurable impact on individual businesses in West Africa while improving their ability to expand thereby providing benefits in terms of government revenue and job creation to the countries’ domestic economies. This is in line with the Bank’s Private Sector Strategy of supporting projects that have a strong impact on job creation, economic growth and poverty alleviation.

  • AfDB, FAO, partner , agric investments

    The African Development Bank and the FAO has agreed to boost joint efforts aimed at catalysing agriculture sector investments in Africa to end hunger and malnutrition and increase prosperity throughout the continent.

    In terms of the agreement, the African Development Bank and the FAO are committed to raise up to $100 million over five years, to support joint activities.

    Specifically, the new strategic alliance seeks to enhance the quality and impact of investment in food security, nutrition, social protection, agriculture, forestry, fisheries and rural development.

    African Development Bank President Akinwumi Adesina and FAO Director-General José Graziano da Silva signed the agreement, which builds on a longstanding collaboration between their organisations, at the UN agency’s Rome headquarters.

    “FAO and the African Development Bank are deepening and broadening our partnership to assist African countries achieve the sustainable development goals. Leveraging investments in agriculture, including from the private sector, is key to lift millions of people from hunger and poverty in Africa and to ensure that enough food is produced and that enough rural jobs are created for the continent’s growing population,” said FAO Director-General José Graziano da Silva.

    The FAO is a specialized agency of the United Nations that leads global efforts to defeat hunger.

    President Adesina said, “The signing of this supplementary agreement is a milestone moment in the relationship between the African Development Bank and FAO. It signals our joint commitment to accelerate the delivery of high quality programs and increased investment for public-private-partnerships in Africa’s agriculture sector. This will help us achieve the vision of making agriculture a business, as enshrined in the Bank’s Feed Africa strategy.”

     

  • All On, AfDB, NDF, others partner on $58m off-grid energy access fund

    Nigerian off-grid energy investment company, All On, said it is partnering the African Development Bank (AfDB), the Nordic Development Fund (NDF); Global Environment Facility (GEF) and Calvert Impact Capital (CIC) towards a $58 million first close for the Off-Grid Energy Access Fund (OGEF).

    OGEF, which is managed by LHGP Asset Management (LHGP), an alternative fund manager with offices in Lagos, London, and Nairobi, is a dedicated debt fund for off-grid energy companies and is part of the AfDB-sponsored Facility for Energy Inclusion (FEI). The FEI is a $500 million finance platform designed to provide loan facilities in both local and hard currencies to support innovative energy access companies.

    AfDB President, Dr. Akin Adesina, said: “Access to electricity is a fundamental human right. That is why the African Development Bank set up the Fund for Energy Inclusion, to support off-grid energy systems. I am delighted that All On and Shell have joined forces with the African Development Bank to invest private capital in this Fund to help accelerate access to electricity in Nigeria. Together we will close the energy access gap in Nigeria and across Africa.”

    OGEF achieves its first close with equity and debt commitments of US $58 million from All On, AfDB, NDF, GEF and CIC, and the structuring process and investments build on support from Shell Foundation, DFID and USAID. FEI OGEF has been designed to provide a flexible range of loan facilities in predominantly local currency, to companies in the household energy access sector including distributors, manufacturers, end-user credit providers and other businesses supporting the ecosystem.

    According to Wiebe Boer, the CEO of Nigeria-based All On, an off-grid energy impact investment company backed by Shell, “We see OGEF as a great opportunity for public and private investors to work together to address Africa’s significant access to energy gap.  We look forward to working with LHGP, especially the Nigeria-based team, to build a solid portfolio of off-grid energy companies that are improving livelihoods by providing affordable power to unserved and underserved communities.”

    This first close follows the official launch of FEI at the Africa Energy Market Place (AEMP) on July 5 and 6, 2018, where the initiative was presented to the governments’ representatives of five African countries – Côte d’Ivoire, Ethiopia, Egypt, Nigeria and Zambia – as well as leaders from the private sector and the development partner communities.

     

     

  • AfDB: Nigeria, others spend $35b yearly to import food

    Nigeria and other African countries spend $35 billion yearly importing food, the African Development Bank (AfDB) Group has said.

    The bank said all continents needed to do was to harness the available technologies with the right policies and rapidly raise agricultural productivity and incomes for farmers, and assure lower food prices for consumers.

    AfdB President, Mr. Akinwumi Adesina, in a keynote speech delivered at the 2018 Agricultural and Applied Economics Association (AAEA) Annual Meeting in Washington, D.C, said farmers across the continent should be empowered with new technologies that have potential to transform agricultural production.

    He said technology transfer was needed immediately and that evidence from countries like Nigeria demonstrated that technology plus strong government backing was already yielding positive results.

    “Technologies to achieve Africa’s green revolution exist, but are mostly just sitting on the shelves. The challenge is lack of supportive policies to ensure that they are scaled up to reach millions of farmers,” Adesina said.

    Adesina cited the case of Nigeria, where policy during his tenure as the country’s Minister of Agriculture resulted in a rice production revolution in three years.

    Adesina said: “All it took was sheer political will, supported by science, technology and pragmatic policies…Just like in the case of rice, the same can be said of a myriad of technologies, including high-yielding water efficient maize, high-yielding cassava varieties, and animal and fisheries technologies.”

    He said AfDB is working with the World Bank, the Alliance for a Green Revolution in Africa (AGRA), and the Bill and Melinda Gates Foundation to mobilise $1 billion to scale up agricultural technologies across Africa under a new initiative called Technologies for African Agricultural Transformation (TAAT).

    It was learnt that TAAT is already taking bold steps to bring down some of the barriers preventing farmers from accessing latest seed varieties and technologies to improve their productivity.

    The AfDB president said: “With the rapid pace of growth of the use of drones, automated tractors, artificial intelligence, robotics and block chains, agriculture as we know it today will change.”

    He predicted that it is more likely that future farmers will be sitting in their homes with computer applications using drone to determine the size of their farms, monitor and guide the applications of farm inputs, and with driverless combine harvesters bringing in the harvest.

    Adesina urged African universities to adapt their curriculum to enable technology-driven farmers and to focus on agribusiness entrepreneurship for young people, emphasising the need to rise beyond theories to application.

    Through its innovative Enable Youth initiative, the AfDB has in the past two years committed close to $300 million to develop the next generation of agribusiness and commercial farmers for Africa.

    Adesina stressed the bank’s resolve to change the face of agriculture in Africa to unleash new sources of wealth.

    AAEA President Scott Swinton said Adesina and the AfDB exemplify the use of economics that makes a difference in people’s lives.

    “If applied economics is economics that make a difference, I think that there is no better example of someone who has used that than Adesina,” Swindon said.

  • Fed Govt partners AfDB on job creation

    The Federal Government has partnered Africa Development Bank (AfDB) to reduce unemployment in the country.

    The government said it plans to engage stakeholders and the AfDB in a roundtable discussion on youth employment and skills development.

    Minister of Labour and Employment, Dr Chris Ngige, disclosed this at the inauguration of the multi-sectoral task team on public-private roundtable on youth employment and skills development yesterday in Abuja.

    Represented by the Minister of State, Prof. Stephen Ocheni, he said the roundtable would have a rich private sector participation due to the widely acknowledged higher potentials for job creation by the sector.

    He said: “The Federal Government, in its continued efforts to respond to the unacceptable situation and reverse trend, has therefore, entered into partnership with the AfDB Group to engage a broad-spectrum of stakeholders in a Roundtable discussion on Youth Employment and Skills Development in Nigeria.

    “The work of the team would key into the aspiration of the Economic Recovery and Growth Plan (ERGP) of the present administration and also boost the rate of attainment of the relevant Sustainable Development Goals (SDGs) in the country.”

    The minister said Nigeria was yet to harness its population potential through productive engagement.

    The Senior Director for the AfDB, Ebrima Faal, said only 77.55 million of Nigeria’s 85.08 million labour force are engaged in some sort of economic activity.

    Represented by, Abdullahi Imoru, he said: “Of the 85.08 million of Nigeria’s labour force, 77.55 million are engaged in some sort of economic activity. This leaves out 7.53 million people doing absolutely nothing.

    “Nigeria has to realise the potential of its youths, create jobs for them or support them to create jobs for themselves; hence the critical importance of entrepreneurship. Hence the key role of the private sector.

    “In 2016, The AfDB adopted a Jobs for Youth in Africa Strategy, with the goal to create 25 million jobs and equip 15 million youth in Africa with employable skills in ten years.  From 2016 to date, the bank has invested over $400 million in both public and private operations that will promote jobs for the youth in the country.”

    Also speaking, the Permanent Secretary in the ministry, Mrs. Ibukun Odusote said: “Although the Federal Ministry of Labour has the mandate to create the enabling environment and coordinate activities on job creation and skills development in the country, we recognise the fact that employment matters are cross cutting in all the sector of the economy.”

  • AfDB boosts Afreximbank’s trade finance with $900m

    The African Development Bank President, Adeniyi Adesina, has said the lender has provided trade finance lines of credit of $900 million trade finance mitigation support to promote Afreximbank’s trade finance activities.

    Adesina said with the rapidly changing world of trade and rising echoes of unilateralism, Africa must trade smartly, starting by ensuring rapid growth in Intra-African trade.

    Speaking in Abuja during a dinner organised to mark the 2018 Annual Meetings and 25th anniversary of the African Export-Import Bank (Afreximbank), Adesina pointed to the important role of the African Continental Free Trade Area (AfCFTA) in that regard, saying when fully implemented, the AfCFTA would raise the share of Intra-African trade in Africa’s total trade from 16 per cent to 52 per cent.

    “It would also increase the value of Africa’s traded goods and services by $35 billion per year,” he added.

     

     

     

  • AfDB, partners hold investment parley

    African Development Bank (AfDB) and its partners will be discussing key roles in accelerating Africa’s investment opportunities.

    The bank had yesterday held a discussion on “Attracting Private Sector Investment into Africa” along BRICS Business Forum, and in collaborating with the South African Chamber of Commerce and Industry (SACCI) in the Capital Empire Hotel in Johannesburg, South Africa.

    The discussion aims to broaden understanding of the key roles that governments, multilateral institutions and private sector can play in accelerating Africa’s investment opportunities ahead of the Africa Investment Forum (AIF).

    AIF”Africa’s own investment marketplace for accelerated economic transformation – will be hosted by Gauteng Province from November 7-9, 2018 at the Sandton Convention Center in Johannesburg.

    Working with multilateral institutions, the private sector, and Governments, the Bank is helping South Africa and other African countries to develop investment-ready projects for investors, fund managers and others managing substantial assets.

    This event will include a keynote speech from Deputy director-General, Southern Africa Regional Development and Business Delivery Office, Josephine Ngure, panel discussion and interactions with key industry players. The event will address the opportunities and challenges of attracting private capital to the continent as well as achieving inclusive economic growth and job creation.

  • AfDB okays $250m risk participation pact with ABSA

    The African Development Bank (AfDB) Board of Directors  has approved an unfunded $250-million Risk Participation Agreement with ABSA Bank Limited.

    The Risk Participation Agreement, housed within AfDB’s Trade Finance operations, will enhance African issuing banks’ ability to leverage trade financing through a multi-sectorial approach.

    When fully utilised, forecast estimates indicate that the facility will catalyse roughly over $2 billion worth of trade in three years. The facility’s alignment to address the acute market demand for trade finance in Africa through agriculture, transport and manufacturing is consistent with the Bank’s goals of ensuring that Africa industrialises, trades more, and is able to feed herself. By extension, this RPA will also foster financial sector development and regional integration.

    Presenting the project to the Board, the Bank’s Financial Sector Development Director, Stefan Nalletamby, made a robust case for how, through strategic partners like ABSA, the bank’s RPA instrument continues to facilitate trade on the continent; thereby helping to reduce Africa’s trade financing gap.

    “This facility, through a 50/50 risk-sharing approach, will help to promote broad-based economic growth on the African continent through increased facilitation of import-export activities of African corporates and SME’s, and increase intra-Africa trade and regional financial integration in line with the Bank’s Hi5 strategic objectives,” he said.

    Most African issuing banks are relatively small and face challenges in obtaining adequate trade finance facilities from international confirming banks to support African importers and exporters. De-risking (the idea of international banks reducing their credit risk stake in developing markets or leaving them altogether) has exacerbated this already dire situation, especially for Africa’s SMEs.

     

     

     

    The bank’s additionality, therefore, lies in the use of its “AAA” credit rating to provide greater comfort to allow ABSA to increase its risk-taking appetite on local banks in Africa and provide them increased trade finance facilities. This consequently enhances the broadening and deepening of Africa’s financial systems.

  • Afreximbank, AfDB sign $.5m pact

    The African Export-Import Bank (Afreximbank) has sealed $500,000 pact with the African Development Bank to  support African Private Sector Assistance (FAPA) programme. The fund will be used in supporting emerging factoring firms in Africa.

    The agreement, signed at the Afreximbank Annual Meetings and 25th Anniversary Celebrations in Abuja, is aimed at upgrading the capacity and skill-sets of up to 20 emerging factoring firms and providing advisory services to enhance the sustainability of established growth-orientated factoring firms, regulators, financial institutions and business and trade associations in Africa.

    Managing Director, Intra-African Trade, Kanayo Awani, signed on behalf of Afreximbank while Ebrima FAAL, Senior Director, Nigeria Country Office, signed for the African Development Bank, in the presence of Elfriede Geisler, Chargé d’Affaires, Embassy of Austria in Nigeria, and Yutaka Kikuta, Ambassador of Japan to Nigeria, who represented the FAPA donor countries.

    President of Afreximbank, Benedict Oramah said: “SMEs in Africa have long faced real difficulties accessing external finance for their business activities and this has impeded their growth and prevented them pursuing commercial opportunities. Afreximbank sees factoring as a solution to bridge the funding gap facing SMEs, and the agreement will support our strategy to grow Intra-African trade and facilitate greater SME contribution to regional and global supply chains.”

  • Fed Govt, AfDB, partner to bridge $3tr infrastructure gap

    RELIEF is underway for the Federal Government as the African Development Bank (AfDB) offered yesterday to assist in bridging the country’s infrastructure gap estimated to cost about $3 trillion in the next 26 years.

    AfDB Senior Director (Nigeria) Ebrima Faal broke the news yesterday at the Africa Investment Forum (AIF) Road show in Abuja.

    Mr. Faal said the AIF idea came from the reality that the government alone could not finance the infrastructure gap in the country which made it difficult to achieve sustainable development.

    He said: “Indeed, over the last decade, and despite impressive growth rates in most of the continent, Africa’s infrastructure needs remain formidable with annual financing gap between 130 and 107 billion dollars annually.

    “Nigeria’s infrastructure cumulative financing needs are estimated to reach $3 trillion dollars by 2044 or about $100 billion annually.

    “This is all happening at a time when public sector finances are extremely pressured. There is therefore a critical need to change the current funding mix and create partnerships to finance infrastructure and other projects in Africa.”

    To this end, Faal said the AfDB planned to assist Nigeria put together a pipeline of bankable projects ahead of the AIF coming up on November 7 to 9 in Johannesburg, South Africa.

    He said the bank, working with multilateral institutions and the private sector, would help the country to develop investment-ready projects for investors, fund managers and others at the forum in South Africa.

    The AfDB chief said: “The African Development Bank is committed to the development of effective public-private-partnerships and has been developing new innovative financing programmes, instruments and partnerships.

    “This is to facilitate the financing and construction of critical infrastructure on the continent.”

    Stella Kilonzo, a Senior Director at the AfDB in charge of the AIF, said through the forum the bank aimed to de-risk investments in Africa.

    According to her, African countries, including Nigeria, struggle to attract significant capital due to poor preparation and packaging of project proposals, limited availability of tools for credit enhancement and risk coverage among others.

    She said in Nigeria, the bank would fast track the Sustainable Development Goals (SDGs) by developing bankable projects in the agricultural, energy and infrastructure sectors, among others.

    The Coordinator of the Economic Recovery and Growth Plan (ERGP), Folarin Alayande, said the Federal Government had identified key priority projects that would spur sustainable growth.

    He listed private investments and job creation; agriculture and transportation; manufacturing and processing; as well as power and gas supply as the sectors being mobilised by the government to attract investment focus.

    To this end, he said Nigeria would require about $22.5 billion of investment commitments by year 2020 to cover 164 projects, spread over six geo political zones.