Aid for African nations to get back on feet

The Africa Finance Corporation, a development-finance institution focused on infrastructure across the continent, expects to more than double its lending this year in a bid to help African countries recover from the coronavirus pandemic.

The organisation, which on Wednesday announced its first direct-borrowing arrangement with the Opec Fund for International Development, plans to lend more than $2 billion (about R30.4 billion) on a net basis in 2021, said Banji Fehintola, the AFC’s senior director, head of treasury & financial institutions.

“We have always done at least $1 billion of net lending annually at a minimum,” he said on Wednesday, adding that this year’s amount would be a record.

“We are trying to get the continent back from the Covid pandemic.”

Countries across the continent were decimated last year as attempts to curb the spread of the virus saw economic activity shut down and trade disrupted. Africa experienced its first recession in a quarter-century last year, according to the World Bank.

“There’s a need to help Africa back as quickly as possible,” Fehintola said. “We’ve always tried to mobilise 10 times” what the organisation contributes.

The Opec Fund for International Development agreed to lend the AFC $50 million, the organisations said in a separate statement. The fund plans to lend $450 million in Africa this year, 9% more than in 2020.

Both organisations see opportunities for investment as the African Continental Free Trade Area agreement is rolled out.

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There’s a need to help Africa back as quickly as possible.

Banji Fehintola

AFC’s senior director, head of treasury & financial institutions.