Finance

African Development Bank Group and Japan sign exchange of notes for $350 million private sector assistance loan

African Development Bank Group and Japan sign exchange of notes for $350 million private sector assistance loan
Monday, 20 February 2023 20:21

The African Development Bank and Japan have signed an exchange of notes for an eighth private sector assistance loan from Japan to finance the Bank’s private sector operations.

The loan agreement, to the tune of JPY 44.1 million or $350 million, carries an interest rate of 0,11 % and a repayment period of 30 years, with a grace period of 10 years. The loan will contribute significantly to funding the Bank’s private sector operations through credit lines.

The signing took place at the Bank Group’s headquarters on Friday 17 February, between its Senior Vice President, Bajabulile Swazi Tshabalala, and Japanese Ambassador to Côte d'Ivoire, Katsuya Ikkatai.

The agreement comes under the joint initiative known as the Enhanced Private Sector Assistance Initiative for Africa (EPSA). This provides financing for the Bank’s private sector operations through a line of credit from the Japan International Cooperation Agency (JICA). The loans are provided on concessional terms.

“This new arrangement which takes our collaboration forward, will build on the existing strong partnership we have had over the years and fits in firmly with the call and vision of our President Dr Akinwunmi Adesina to further strengthen our collaboration with Japan,” said Tshabalala following the signing.

Ambassador Ikkatai noted that the Tunis Declaration, adopted at the Eighth Tokyo International Conference on African Development, or TICAD 8, last August, emphasizes that private investment is essential for Africa's economic growth and inclusive and sustainable development. “Moreover, at TICAD 8, our Prime Minister Kishida announced $30 billion in public and private investment from Japan for Africa over the next three years. And this support signed today reflects a strong joint action of the Government of Japan and the African Development Bank which embodies exactly this policy of Japan,” he added.

To date, the Bank and the government of Japan have signed seven non-sovereign loans totalling $1.5 billion. The loans have contributed to support 51 projects, mainly credit lines and equity to regional development finance institutions, private equity funds and project finance for infrastructure public-private partnerships.

The EPSA loans for non-sovereign operations help finance the Bank’s private sector operations through credit lines (NSLs) from JICA to the Bank. In principle, although pooled with the other financial resources of the Bank and subject to normal Bank processes (including eligibility and pricing), the resources are attributed to specific projects “endorsed” by the Japanese Government.

The government of Japan is one of the Bank’s biggest contributors, participating in the sixteenth replenishment of the African Development’s concessional window, the African Development Fund, in December last year. Japan also contributed to the African Development Bank’s General Capital Increase (GCI-7) in 2019.

During TICAD8 held in Tunis in August 2022, the heads of the Bank and JICA announced the fifth phase of EPSA, from 2023-2025. It has a joint target of $4 billion, which is $500 million more than EPSA 4. An additional up to $1 billion will be provided by JICA under a new special window to promote debt transparency and sustainability reforms in Africa.

8084 agency                          

On the same topic
Côte d’Ivoire will receive $234 million for a sustainable urban mobility project in Abidjan. Gambia will receive $32.2 million to build...
Stanbic IBTC and Zenith Bank cut monthly card spending abroad to $500 and $200 Foreign reserves fall by $3.5 billion in six...
Cauri Money launches Gajo Money, an e-wallet for the Cameroonian diaspora, targeting €120 million in transactions by end-2025. The fintech...
• Kenya and ASR sign deal to reduce risk on projects worth up to $2 billion.• Risk cover will target infrastructure, energy, logistics, and trade...
Most Read
01

• Investors seem to keep focusing on yields, which are high for the moment• New Leadership might see...

Afreximbank Bonds Retain Market Confidence Despite Moody’s Downgrade
02

• Inflation within the West African Economic and Monetary Union (UEMOA) fell to a two-year low of 0....

UEMOA: Inflation Drops to 0.6% in May, Driven by Lower Food Prices
03

• Qatar Airways and Kenya Airways establish strategic agreement, introducing a third daily flight be...

Qatar Airways Expands its Network in Africa, Building Presence in Kigali, Johannesburg, and Nairobi
04

• EY is preparing to leave Francophone Sub-Saharan Africa by 2026• The exit could unlock $500 m...

EY’s Exit Creates $1bn Opportunity in Francophone Africa Consulting Market
05

• Interbank volumes rose 18.7% in May, while rates declined across the market• The BCEAO cut its mai...

WAEMU Sees Easing Conditions on Regional Interbank Market
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

regie@agenceecofin.com 
Tél: +41 22 301 96 11 
Mob: +41 78 699 13 72
Média kit : Download

EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.