The Africa Finance Corporation (AFC) has launched a $2billion (About N826billion) facility to support recovery and resilience in Africa as a response to economic challenges created by the COVID-19 global pandemic and the Russia-Ukraine conflict.
Before now, the AFC had committed to funding up to 50 per cent of the new African Economic Resilience Facility and mobilising the remainder through the corporation’s network of international partners and investors. The announcement was made on Thursday in Abuja at the AFC Live Infrastructure Solutions Summit.
According to the corporation, the facility will be disbursed through loans from AFC to selected commercial banks, regional development banks and central banks in various African countries, providing them with much needed hard currency liquidity to finance trade and other economic activities in their jurisdictions.
These institutions will be able to leverage AFC’s proven access to global funding to receive financing at competitive rates.
Speaking on the rationale behind the launch, Head of Treasury and Financial Institutions, Banji Fehintola, said: “The COVID-19 pandemic set back Africa’s economic growth trajectory and widened the trade financing gap, while the Russia-Ukraine conflict has added a set of challenges negatively impacting growth prospects across the continent.
