The Boards of Directors of the African Development Bank (AfDB) and the African Development Fund (ADF) have approved a grant of UA 16 million to the African Legal Support Facility (ALSF) to strengthen the legal expertise and negotiating capacities of transition states in Africa.
The funds, from the ADF’s Transition Support Facility, will provide additional funding and operational flexibility through which the Bank can assist eligible Regional Member Countries (RMCs) facing issues of fragility to build resilience.
The Targeted Support Window (Pillar III) through which the funds will be disbursed, provides a limited pool of resources to support capacity building and technical support activities which cannot easily be done through traditional institutional support projects and programs.
The Bank is strengthening its engagement with its RMCs by equipping them with tools to help ensure fair and balanced negotiations between African countries and investors and creditors that deliver maximum economic value to the countries while protecting their sovereign rights.
The legal assistance provided is expected to strengthen countries’ legal expertise and negotiating capacity in debt management and litigation; natural resources and extractive industries management and contracting; investment agreements, and related commercial and business transactions.
According to the African Development Bank, this will contribute to improving the overall governance and investment climate and facilitating investments in services and infrastructure delivery, as well as attracting private investments. The AfDB further stated that better management of debt and natural resources will also contribute to building long-term resilience.
“This operational and financial support to the ALSF will be exclusively for bolstering its work in support of transition countries”, the AfDB said.
This includes the provision of technical assistance to strengthen legal expertise and negotiating capacities in matters about debt and vulture fund litigation; natural resources and extractive industries management and contracting; infrastructure development modalities; public-private partnerships (PPP) investment agreements, and related commercial and business transactions.
The AfDB said, “this wide range of support to transition countries ensures that such countries negotiate deals that deliver greater financial and non-financial benefits to governments and their citizens”.
The ALSF’s mission and operations priorities are closely aligned with the TSF’s: investing in quality and sustainable infrastructure, and delivering capacity to promote inclusive growth.
The AfDB and the ADF have supported several programs in many African countries this year. On December 18, 2020, the Board of Directors of the ADF approved a $9.8 million grant to Guinea Bissau for its national Control Support Project (PALPC), aimed at reducing the spread of the COVID-19 virus and boosting the resilience of the health system and communities, especially the most vulnerable.
The support was timely because Guinea Bissau has been affected by the COVID-19 pandemic which has led to food shortages, economic pressure, and reduced livelihood opportunities in the West African nation.
On Wednesday 28th October 2020, the AfDB approved support for Madagascar’s industrial and financial sectors with a loan of €14.52 million (12.08 million UA) through the ADF, under a concessional-rate loan arm.
The Industrialization and Financial Sector Support Project (PAISF) will bolster Madagascar’s industrial sector, to reduce poverty by creating decent employment and promoting investment.
The project will also support the financial sector and help small and medium-sized enterprises (SMEs) more closely integrate into the industrial value chain.
Similarly, on 19th October 2020, the Board of Directors of the ADF approved a loan of UA 36 million ($50.7 million) to Tanzania, to finance the nation’s response to the COVID-19 pandemic.
The loan, from the AfDB Group’s COVID-19 Response Facility (CRF), will support the Government of Tanzania’s $109 million national COVID-19 response plan, which is jointly supported by the country’s other development partners.
The plan is aimed at building economic resilience, while mitigating the socio-economic and health impacts of the COVID-19 pandemic, particularly on local businesses, vulnerable households, and the country’s health system.
