Lusophone countries have identified a pipeline of more than US$5 billion in private sector and private-public partnership (PPP) projects to accelerate growth in their economies
The projects form part of a development finance compact between the Bank, the government of Portugal, and the six Portuguese-speaking countries of Africa - Angola, Cabo Verde, Equatorial Guinea, Guinea-Bissau, Mozambique, and Sao Tomé and Principe, also known as PALOPs. The compact, signed at the African Investment Forum in Johannesburg on Tuesday, stems from efforts by the African Development Bank to bring more focus on the private sector in the PALOPs.
Akinwumi Adesina, President of the African Development Bank, started the process nearly a year ago during an official visit to Portugal.
"Today is a day of delight, when we shine the light on a part of Africa that doesn't always get the attention it deserves," Adesina said at the signing, attended by representatives from Angola, Cabo Verde, Mozambique and Sao Tomé and Principe.
He added: “Lusophone countries, home to 267 million people worldwide, possess a wealth of natural assets. "Lusophone countries in Africa have huge resources like oil and gas, yet human development is low, and infrastructure development is low."
Adesina said while the compact focusses on private sector investment, government support is vital. "Of course, nothing gets done without political leadership. I was very delighted when we had a meeting in Cabo Verde and the heads of state all supported that this compact should go ahead."
Adesina said the African Development Bank would provide guarantees and financing to support Compact projects that are also supported by Portugal. At the session, The Secretary of State for Foreign Affairs and Cooperation of Portugal, Teresa Ribeiro, pledge an amount of EUR 400 million provisioned under the 2019 State Budget for guarantees plus an additional envelope of EUR 20 million to be deployed by SOFID – the Portuguese Development Finance Institution, for these projects”.
The objectives of the compact include accelerating inclusive sustainable and diversified private sector growth in PALOPs and also leveraging the tools the African Development Bank, Portugal and the PALOPS have at their disposal. These tools are: risk mitigation for private sector and PPP investments, direct financing for investments, and technical assistance to enhance private sector development.