Japan

Background

Japan joined the AfDB on  December 3, 1982, and the ADF on  June 22, 1973. Japan is the largest contributor to the African Development Fund (ADF) in cumulative terms after the United States and the third largest shareholder in the ADB after Nigeria and the United States.

Japan’s collaboration with the AfDB is articulated around 3 main pillars: ADF replenishment, bilateral trust fund PHRDG (Policy and Human Resources Development Grant), and the Joint Bank-Japan EPSA (Enhanced Private Sector Assistance) initiative.

The first cooperation agreement was signed in 1994 between the Ministry of Finance of Japan and the African Development Bank establishing the Policy and Human Resources Development Grant (PHRDG). PHRDG (100% untied) supports ADF countries, with focus on HIPC eligible countries in the areas of human resource development and technical assistance support to the Bank Group’s operations.
The Enhanced Private Sector Assistance for Africa (EPSA) was launched by Japan and the Bank in 2005 with the earmarked budget of US$1 billion over five years.

Until October 2008, Japan’s Official Development Assistance (ODA) was divided into three main categories: Bilateral Grants (Grant Aid and technical cooperation) through the Ministry of Foreign Affairs and the Japan International Cooperation Agency (JICA) and Bilateral Loans through JBIC.

As of October 1, 2008, JICA and Japan Bank for International Cooperation (JBIC) merged into “New JICA”. The integration of the two institutions is a major change in the Japanese ODA architecture.

The responsibilities for the Japanese ODA loans have been transferred from JBIC to JICA. New JICA will now manage 1) ODA loans, 2) technical cooperation and 3) grant aid (excluding grant assistance being directly implemented by the Ministry of Foreign Affairs), under joint supervision by the Ministries of Foreign Affairs and Finance.

All the rights and obligations of JBIC with regard to the overseas economic cooperation operations (e.g. EPSA) will be taken over by JICA. “New JICA” is now the second largest donor agency within the Bank after the World Bank with financial resources of US$8.5 billion. 

Joint Initiatives

  • The PHRDG is, among other things, supporting the Enhancement of Economic and Financial Programming in Mauritania and the Implementation of Poverty Reduction Strategy Processes in Burkina Faso, Sao Tome and Principe, Rwanda, Cameroon, Malawi and Niger.
  • The Enhanced Private Sector Assistance for Africa (EPSA) comprises three key components: NSL – the Non-Sovereign Loan component that provides concessional financing to the Bank’s private sector operations, ACFA – the Accelerated Co-financing Facility for Africa that provides joint financing on concessional terms for AfDB-led public investment projects and FAPA – the Fund for African Private Sector Assistance – that provides grants for technical assistance and capacity building.
  • The Japan International Cooperation Agency (JICA) is supporting the Secretariat of the Infrastructure Consortium for Africa (ICA) with a secondment of an institutional/financial expert to the Consortium, hosted by the Bank since April 2006.
  • Since March 2006, Japan is seconding a staff as EPSA Focal Point in the Private Sector Department (OPSM).

Formal agreements and financial contributions

  • Cooperation Agreement signed in 1994 between the Ministry of Finance of Japan and the African Development Bank establishing the Policy and Human Resources Development Grant (PHRDG).
  • The Enhanced Private Sector Assistance for Africa (EPSA) was launched by Japan and the Bank at the Gleneagles Summit in 2005 by the Japanese government with the earmarked budget of US$1 billion for five years. In February 2007, a first Loan of JPY 11.5 billion (Approx US$ 100 million) was granted to the Bank. On  September 11, 2008, an additional credit line of JPY 32.1 billion, equivalent to US$ 300 million was granted to the AfDB through EPSA non-sovereign component. The second EPSA loan brought Japan’s total financial support through the Bank under the EPSA Initiative to about US$ 590 million, more than half of the US$1 billion pledged for EPSA by the Japanese government at the Gleneagles Summit in 2005.
  • In October 2008, AfDB entered into a new Memorandum of Understanding (MoU) with the “new JICA” to facilitate collaboration in regional infrastructure development, improvement of agriculture productivity, including rice production in Africa under the Coalition for African Rice Development, private sector development, the environment and climate change; Poverty Reduction Strategies, support for post-conflict fragile states, water and sanitation and the sharing of the lessons from Asian development experiences.
  • A MoU between the University of Tsukuba of Japan and the AfDB was signed on May 27, 2008, during TICAD IV to enhance knowledge partnership on higher education, science and technology.

Focal point for the AfDB-Japan partnership and cooperation

Veronica Giardina
Senior Cooperation Officer
Partnerships and Cooperation Unit (ORRU)
Email: v.giardina@afdb.org
Tel: (216) 71 10 2519

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