Finland increases its support for the African Development Fund
Finland will contribute 68.4 million euros to the replenishment of the African Development Fund (AfDF), which is the concessional window of the African Development Bank Group, informed the Ministry for Foreign Affairs. Finland is also preparing a loan of 80 million euros for the AfDF. The AfDF supports the continent's poorest countries.
More than 30 donor countries and representatives of African countries have reached an agreement on the 14th replenishment of the AfDF for 2019–2022. The donor countries’ development cooperation funding accounts for 5.5 billion euros of the total financing package of 6.8 billion euros. The AfDF grants concessional loans to the poorest countries in Africa. The Fund is replenished every three years.
Finland's pledge consists of a grant element and a concessional loan to be presented next year, some of which will be in grant form. Finland’s pledge means a 45% increase on the 62.8 million euros contributed in the replenishment round of 2016–2019.
The objectives of the Fund are in line with Finland's long-term development policy objectives, which focus on supporting the private sector and creating jobs, especially for young people; education; fragile states; equality; and combating climate change. Approximately 95% of the AfDF's funding goes to the least developed countries (LDCs) and about 57% goes to fragile countries.
Sustainable Development Goals
“The replenishment supports well the geographical focus of Finland's development policy on Africa, the use of development policy investments to help achieve the Sustainable Development Goals (SDGs), and our contribution to climate work,” says Minister for Development Cooperation and Foreign Trade Ville Skinnari.
Despite the fact that many African countries have made good progress over the past decade, economic growth remains below the level needed to meet the UN sustainable development goals. Many countries have been afflicted by a downturn in the world market prices for raw materials in recent years. Other causes for concern are strong population growth and increasing youth unemployment as well as rapidly growing refugee flows and migration, brain drain and the rise of extremist movements.
In the next replenishment period, the AfDF will pay particular attention to fragile states and the development of the private sector. The share of climate finance will grow to 40%. These priorities are well in line with the United Nations SDGs and Finland’s development policy.