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The Japanese government has increased its assistance to private sector projects in Africa through a concessional, or ‘soft’, loan of JPY 8,440 billion, or approximately USD 100 million, to the African Development Bank (AFDB).
This loan, entitled the Third Private Sector Assistance Loan, marks the culmination and fulfilment of a pledge that Japan made at the Gleneagles Summit to provide USD 1 billion to Africa through the AfDB.
The Exchange of Notes was signed by the president of the AfDB, Mr. Donald Kaberuka, and His Excellency, Mr. Toshiyuki Taga, the Japanese Ambassador to Tunisia.
Following that signing, the relevant loan agreement between the AfDB and the Japan International Cooperation Agency (JICA) was signed by Mr. Pierre Van Peteghem, the AfDB Treasurer, and Mr. Ryuichi Tomizawa, Chief Representative, JICA Tunis Office.
The new funds will help finance the launch and growth of small and medium-sized enterprises (SMEs) and other private sector initiatives in Africa.
Mr Kaberuka said: “The AfDB is very pleased to celebrate this full achievement of Japan’s commitment today with Ambassador Taga and other distinguished members of the Japanese delegation. I would like to express our sincere appreciation to the Japanese government and the Japanese people for their generous support and vote of confidence it represents for our continued partnership under the EPSA Initiative”.
He added the loan would support the continuation and growth of the AfDB’s assistance to African SMEs and other types of investment critical to private sector growth and development. Such investments included public-private partnerships to provide essential economic infrastructure, and direct investment by the AfDB in key African financial institutions and enterprises.
The Exchange of Notes and loan agreement are part of the Enhanced Private Sector Assistance (EPSA) Initiative. EPSA is an innovative, multi-component, multi-donor framework for mobilising resources and developing partnerships to support the AfDB’s Strategy for Private Sector Development. EPSA was initially conceived in partnership with the Japanese government.
The first loan for private sector operations between Japan and the AfDB was signed in February 2007, in the amount of JPY 11.5 billion. It was followed by a second loan of JPY 32.1 billion, signed in September 2008.