MICROCAPITAL BRIEF: Canadian Government Donates $309m to African Development Fund (ADF)

The Canadian Minister of International Development, Christian Paradis, recently announced that the Canadian government will provide CAD 309 million (USD 279 million) to the African Development Fund (ADF), a fund that provides loans and grants to its 40 African member countries, to support the 13th replenishment of ADF’S budget funds. The donation is intended to support the African Development Bank (AfDB), the parent organization of ADF, in supporting development and poverty reduction programs in Africa. The announcement was made at the “Canada Business Summit,” which has hosted by the Canadian Council on Africa (CCAfrica), a Canadian nonprofit organization devoted to the economic development of Africa.

Additionally, Canada will contribute CAD 12.5 million (USD 11.3 million) to the Ministry of Mines of Ethiopia over a five-year period to provide training to workers in the private sector and to strengthen education initiative aimed to reach the general public regarding the mining sector.

The African Development Fund has invested UA 29.4 billion (USD 45 billion) in 40 countries since the beginning of its operations in 1974. As of December 31, 2013, the African Development Bank (AfDB) reported total assets of USD 8.6 billion and a loan portfolio of approximately USD 3 billion.

By Simon Pfanner – Research Associate

About African Development Fund (ADF)

The African Development Fund was established in 1972 and is operated by the African Development Bank. Its main goal is to reduce poverty by providing loans and grants to its African member countries. Project loans are to be repaid over 50 years, with a 10-year grace period. ADF requires payment of a service charge of 0.75% per year and a commitment fee of 0.5% per year on funds that have not been disbursed (starting 120 days after the loan is signed). As of 2014, the African Development Fund has invested UA 29.4 billion (USD 45 billion) in 40 countries since the beginning of its of operations in 1974.

About African Development Bank (AfDB)

The African Development Bank Group (AfDB) was founded in 1964 and provides loans and grants to governments and private companies in Africa. It consists of three entities: The African Development Bank, The African Development Fund and The Nigerian Trust Fund. Owned and funded by its member governments, the bank has a mandate to reduce poverty and promote sustainable development. AfDB shareholders consist of 78 member countries as of 2014, including 53 African countries, to which it commits an approximate total of USD 3 billion annually.

About CCAfrica

Established in 2002, the Canadian Council on Africa (CCAfrica) is a Canadian nonprofit organization devoted to the economic development of Africa by promoting trade and investment. As of 2014, CCAfrica has approximately 150 members, including enterprises, government agencies and education institutions.

Sources and Additional Resources

[1] International Government of Canada, Canada Promoting sustainable economic growth in sub-Saharan Africa

MicroCapital, August 14, 2014, African Development Bank (AfDB) Issues $80m in Local Currency Bond in Nigeria’s Capital Market

MicroCapital, May 8, 2014, African Development Bank (AfDB) Announces $9m Line of Credit for Moza Banco of Mozambique for SMEs

MicroCapital, July 25, 2013, African Development Bank (AfDB) Loans $17m to Societe Nigerienne de Banque (Sonibank) of Niger to Support Private Sector

MicroCapital Universe Profile: African Development Fund (ADF)

MicroCapital Universe Profile: African Development Bank Group (AfDB)

MicroCapital Universe Profile: CCAfrica

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