Head of Egypt’s central bank calls on AfDB to expand concessional loans to member states

Ahram Online , Saturday 27 May 2023

Governor of the Central Bank of Egypt (CBE) Hassan Abdallah urged on Friday the African Development Bank (AfDB) to increase its lending to member states on concessional terms.

Hassan Abdallah
File Photo: Hassan Abdallah, Governor of the Central Bank of Egypt (CBE). Al-Ahram


The AfDB has 81 member states including regional countries in Africa and non-regional countries around the globe.

Abdallah emphasized that the strong AAA credit rating of the AfDB, which allows it to obtain low-interest funding, means the bank can afford to increase concessional loans to member states.

AfDB funds are derived from subscriptions by member countries, especially non-regional member countries, borrowings on international markets and loan repayments. 

He made this appeal during the 58th Annual Meetings of the Board of Governors of the AfDB, which concluded in Sharm El-Sheikh on Friday after five days of deliberations. 

Abdallah stressed the importance of establishing a mechanism to curb the risks associated with exchange rate fluctuations. Member states often borrow foreign currency to finance long-term projects while receiving returns from those projects in local currency. This dynamic can create significant pressures, the CBE governor added.

Abdallah urged the AfDB to capitalize on the accomplishments and recommendations made during its meetings in Sharm El-Sheikh to foster sustainable development across African countries.

He also extended congratulations to Kenya for being selected to host the bank’s annual meetings in Nairobi in 2024.

During the meeting’s closing session, the chairmanship of the Boards of Governors was transferred to Kenya's Finance Minister, Njuguna Ndung'u.

On the sidelines of the AfDB meetings last week, Egypt’s Minister of Finance, Mohamed Maait, said Egypt is seeking concessional loans from regional and international development partners to ensure sustainable spending on healthcare, education and food security programmes.

Maait explained that Egypt is coping with the impacts of the global crises by boosting production and supporting activities with the most exposure to both internal and external shocks.

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