SIGNING OF TWO LOAN AGREEMENTS TOTALING €175 MILLION BETWEEN AFD AND BOAD
Lomé, 7 July 2020. Messrs. Christian Adovelande, President of the West African Development Bank (BOAD), and François Jacquier-Pelissier, Director of Agence Française de Développement (AFD) in Togo, have signed today at BOAD headquarters, two financing agreements totaling €175 million (or XOF114.8 billion). They respectively fall within the context of the French initiative “COVID 19 – Santé en Commun” supported by AFD Group and climate finance. Such support is accompanied by a technical assistance grant of €0.6 million (or XOF393 million). This overall funding from AFD will contribute to BOAD’s strategy for WAEMU member countries and economic operators in the context of sustainable economic recovery following the Covid-19 pandemic.
The first loan agreement of €100 million (XOF65.6 billion) aims to support BOAD in its counter-cyclical response to the crisis.
First and foremost, it contributes to the financing of the response plans of WAEMU member countries as part of an initiative led by BOAD, in conjunction with BCEAO and the WAEMU Commission. An emergency loan at a preferential rate of XOF15 billion has been made available to each member country (for a total of XOF120 billion). Then, the AFD-BOAD loan agreement will finance economic stimulus investments made by the private sector in the sub-region, for which BOAD has just made available to the Union’s commercial banks a refinancing facility of XOF100 billion.
In addition to this financing component, BOAD and AFD are planning a strategic dialogue on sustainable economic recovery in the aftermath of the crisis, and as part of the formulation of BOAD strategic plan for 2021-2025, whose key areas and directions have just been approved during its 117th Board meeting held on 24 June.
The second agreement covers a LoC of €75 million (or XOF49.2 billion) and a technical assistance grant of €600,000, whose purpose is to contribute to the development of resilient and low-carbon economic models in the WAEMU region by increasing and redirecting investment flows towards climate projects. More specifically, the LoC is meant for financing projects involving greenhouse gas emissions mitigation (25%) and adaptation of vulnerable populations to the repercussions of climate change (75%) in the sub-region. The grant will support BOAD in implementing its environmental and climate strategy so that it can provide sustainable support to its member countries and partners on climate issues.
This support which comes as a response to two requests from BOAD, is fully in line with AFD Group’s strategy to support the structuring of a resilient and sustainable financial ecosystem capable of operationalizing the financial component of Agenda 2030 on Sustainable Development and the Paris Agreement on Climate in West Africa.
In signing these agreements, a new stage has been reached in the rich historical partnership that BOAD and AFD have maintained since the inception of the regional bank in 1976. This partnership has notably materialized into nine operations in different areas (agriculture, public service infrastructure, private sector support, energy sector, financial consolidation, climate) and fuelled by regular interaction between the top management and operational teams of the two institutions. It is also reflected as part of the joint membership of the International Development Finance Club (IDFC) which leads the strategic debate of the world’s main public development banks on achieving sustainable development goals (SDGs) and aligning with the Paris Climate Agreement, as well as the initiative “Mainstreaming Climate Action in Financial Institutions”, which to date brings together 44 public and private financial institutions active in promoting climate finance.
AFD and BOAD will attend together the first summit of development banks on financing sustainable development goals (SDGs) to be held in Paris from 10 to 12 November in conjunction with the Paris Peace Forum. This major event will bring together for the first time all the public development banks and will provide an essential platform to urge these institutions to work hand in hand in order to unleash their full potential and maximize investments consistent with the multilateral sustainable development agenda.
About AFD
The Agence française de développement (AFD) Group is a public institution that finances, supports and accelerates transitions towards a fairer and more sustainable world. As France’s official platform for development assistance and investment in sustainable development, we work closely with our partners to build shared solutions involving and benefitting the populations in the South.
Our teams are involved in more than 4,000 projects on the ground, overseas and in 115 countries for the common good of mankind – climate, biodiversity, peace, gender equality, education and health, thereby contributing to the commitment of France and the French people to sustainable development goals. For a shared world.
About BOAD
The West African Development Bank (BOAD) is the common development finance institution of the member countries of the West African Economic and Monetary Union (WAEMU). A public international institution whose purpose, as provided under Article 2 of its Articles of Association, is “to promote the balanced development of member countries and foster economic integration within West Africa” by financing priority development projects. The Bank is accredited to the three climate finance mechanisms (GEF, AF, GCF). As of 2009, BOAD has been an observer to the UNFCCC and actively contributes to discussions relating to the design of an international climate finance architecture. Since January 2013, it has been home for the first Regional Collaboration Center (RCC) on Clean Development Mechanism (CDM), whose aim is to provide direct support to governments, NGOs and the private sector in identifying and developing CDM projects. It is committed to becoming carbon neutral by 2023.
Press contacts: AFD: Mr. Noël Ameble – ameblen@afd.fr – 22 23 07 30
BOAD: Mrs. Irène Da Silveira – dassiongbon@boad.org – WhatsApp : 99 99 32 15