OPEC Fund to lend $50 mln to AFC to boost infrastructure, create jobs in Africa

Doaa A.Moneim , Thursday 9 Feb 2023

The OPEC Fund for International Development and Africa Finance Corporation (AFC) have signed a 10-year $50 million loan agreement to finance the development of infrastructure with the aim of boosting the continent’s economic growth and job creation, the fund announced on Thursday.

opec fund


The loan proceeds will be used to improve connectivity, transport, logistics, and trade as well as increase access to energy across the African continent, according to the OPEC Fund.

The loan doubles the OPEC Fund’s commitment to AFC following an initial $50 million 10-year loan provided in January 2021, and builds on collaboration initiated through a cooperation agreement in 2017, the fund said.

It added that the loan is aligned with the United Nations Sustainable Development Goal (SDG) 9, Innovation and infrastructure, and SDG 17, Partnerships.

“Africa continues to be a key region for the OPEC Fund, with more than 45 percent of our aggregate financing dedicated to the continent. Sustainable infrastructure development is key to unlock Africa’s vast potential and enable it to fully utilise its resources. Working with local partners on the ground such as AFC helps to deepen our impact and support Africa’s development agenda,” said OPEC Fund Director-General Abdulhamid Alkhalifa.

AFC President and CEO Samaila Zubairu stated that developed and developing countries alike are battling the chronic challenges brought on by a wave of global shocks, and these challenges will only be solved by working together through partnership and engagement between the world’s leading finance institutions.

Africa’s economic growth has been slowed by global supply chain disruptions and rising costs in the aftermath of the COVID-19 pandemic, further widening the continent’s infrastructure funding gap.

The collaboration between the OPEC Fund and AFC is targeted at increasing access to long-term sustainable finance for infrastructure projects.

AFC is a multilateral financial institution with 39 member countries, including Egypt, established to provide financing and private sector-driven solutions for infrastructure in key sectors including power, transport, heavy industries, telecommunications, and natural resources. To date, AFC has invested over $11 billion in projects across 36 African countries.

The OPEC Fund, established in 1976, is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively.

AFC was established in 2007 to be the catalyst for private sector-led infrastructure investment across Africa.

In September 2021, Egypt became AFC’s 32nd member state.

With this membership, Egypt enjoys all the benefits of being a member of the AFC, including increased investment allocation, preferred access to the AFC’s structuring and lending solutions, reduced debt costs, and access to advisory and project-development services.

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