The People’s Bank of China (“PBOC”) and the African Development Bank have signed a $2 billion co-financing fund deal dubbed the Africa Growing Together Fund (“AGTF”) to finance development projects in Africa for ten years.
AGTF will operate under AfDB and is expected to be operational within this year.
Charles Boamah, Vice-President and CFO of the African Development Bank Group, said “the AGTF enables an additional US $200 million in more or larger-sized projects annually throughout Africa, on identical terms and conditions as for loans made by the AfDB itself to the same projects. This builds on the success of similar instruments such as the Nigeria Trust Fund, which has been in operation for close to 40 years.” He expressed a hope that this model will be replicated with many more regional as well as non-regional member countries of the AfDB.
Zhou Xiaochuan, Governor of the People’s Bank of China said, “the AfDB’s rich experience, convening power and strong results-oriented culture made the Bank China’s ideal partner for channeling resources in support of long-term growth and development on the continent.”
AfDB was set up in 1964 to spur sustainable economic development and social progress in its member countries by mobilizing and allocating resources for investment in RMCs; and providing policy advice and technical assistance to support development efforts. The financing wil hep it allocate to more countries to achieves their MDG’s. However, there have been questions on the intention of China in Africa with increasing involvement in development projects in Africa. Other analysts says China is investin money to mobilise Africa leaders to turn to it instead of the West for its own business and political gains. Others support China saying it’s Africa’s alternative trade partner and source of capital.