African Development Bank wants more funds for African recovery

The African Development Bank Group (www.afdb.org) is urging the G-20 Summit to increase its resources. The bank says Africa and low income countries should not be left behind if the world economy shows signs of recovery.

Meanwhile the IFR Markets news service, quoted on Reuters newsagency, says AfDB,  rated AAA by leading ratings agencies, plans a $1 billion 3-year global bond issue.

The “G-20” is a meeting of finance ministers and central bank governors from 19 developed countries, plus the European Union (EU), plus World Bank, International Monetary Fund and others. They are meeting in Pittsburgh, USA from 24-25 September. According to Wikipedia, they marshall 85% of the world economy, 80% of world trade, and 67% of the population.

AfDB President, Donald Kaberuka, said: “The economic crisis has been a major setback for Africa. The African Development Bank has played its role acting countercyclically. It has proved to be a reliable, responsive partner. Additional concrete steps for crisis mitigation and supporting recovery in low income countries are critical.”

He called for a general capital increase and replenishment of the soft loan African Development Fund (ADF). AfDB expects its investments in 2009 to double with commitments amounting to some US$11 bln, from US$5.8 bln in 2008, largely in response to the global financial crisis. Investments go to budget support, infrastructure, liquidity programs and trade finance.

AfDB announced its response to the crisis in March, including a US$1.5 bln emergency liquidity facility, a US$1 bln trade finance initiative, accelerated transfers of concessional resources to eligible countries, and more advisory support.

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