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(Ecofin Agency) – Over the past few years, the private sector has been a key focus of AfDB’s activities. The aim is to support inclusive and sustainable growth in Africa. In that bid, it is supported by strategic partners, including Japan.
The African Development Bank (AfDB) announced Tuesday (April 25), a $350 million loan agreement with the Japan International Cooperation Agency (JICA) to support the African private sector.
The agreement was signed on the sidelines of the Japan-Africa Investment Ecosystem Co-creation Forum. It is part of the Enhanced Private Sector Assistance Initiative (EPSA), which is a component of Japan’s official development assistance to Africa.
For Mr. Tanaka Akihiko, President of JICA, this collaboration with the AfDB is a crucial step to support Africa which is facing multiple aggravated crises, including debt sustainability issues and the impact of the war in Ukraine.
“The private sector in Africa is fundamental in creating jobs for the prosperity and progress of Africa. Although the private sector has been facing unprecedented economic and social pressures, we are confident that the Bank’s Non-sovereign Operations supported through this concessional loan will play an essential role in addressing these pressing issues,” he added.
At the conference, AfDB President, Akinwumi Adesina, also urged Japanese investors to significantly increase their presence on the continent, with a notable focus on agriculture. For him, it is necessary to “support young people to go into agriculture.”
“Youth are Africa’s best asset, but they lack access to finance. The Bank is establishing youth entrepreneurship investment banks to provide young people with financial and technical support throughout the business cycle,” he explained.
In recent years, Africa has emerged as a choice destination for foreign investors due to its demographic, agricultural, energy, and technological potential. Like many major developed nations, Japan has shown its ambition to increase its interests on the continent.
Let’s note nevertheless that Japan’s foreign direct investment in Africa fell from $10 billion in 2016 to $4.7 billion in 2020. In 2021, it recovered to $6 billion.
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