African Development Bank Shareholders Approve Landmark $115 Billion Capital Increase, Signalling Strong Support
Photo: AfDB
African Development Bank (AfDB) president Akinwumi Adesina speaking at the extraordinary shareholders' meeting in Abidjan, October 31st, 2019. The Governors of the African Development Bank, representing shareholders from 80 countries, approved a landmark $115 billion increase in capital for the continent's foremost financial institution. The capital increase, the largest in the history of the African Development Bank since its establishment in 1964, is a remarkable show of confidence by shareholders.
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African Development Bank (Abidjan)
Bank's capital base more than doubles. Jumps from $93 billion to $208 billion
Largest capital increase in the Bank's history signals a united front by shareholders
At an extraordinary shareholders' meeting today in Abidjan, Governors of the African Development Bank, representing shareholders from 80 countries, approved a landmark $115 billion increase in capital for the continent's foremost financial institution.
The capital increase, the largest in the history of the African Development Bank since its establishment in 1964, is a remarkable show of confidence by shareholders.
With the approved increase, the capital of the Bank will more than double from $93 billion to $208 billion. This solidifies the Bank's leadership on development financing for the continent.
The boost in capital ensures that the Bank will continue to maintain a sterling AAA rating, all stable, from the top rating agencies.
The African Development Bank launched discussions on the request for a general capital increase two years ago, to help fast track the delivery of its High 5 development strategies, the sustainable development goals and the African Union's Agenda 2063.
Speaking at the opening ceremony, the President of Ivory Coast, Alassane Ouattara said: "the integration of the continent's priorities into the High 5s indicates that the African Development Bank group is a strategic partner for African governments."
In the past four years, the Bank's High 5 priorities have delivered impressive results on the ground, including helping to connect 16 million people to electricity, 70 million people provided with agricultural technologies to boost food security; 9 million people given access to finance through private sector investee companies; 55 million people provided improved access to transport services; and 31 million people with access to water and sanitation.
AfDB Board Approves Largest Capital Increase in Bank's History
At an extraordinary meeting held on Thursday October 31st, the board of the African Development Bank approved a 125% capital increase - the largest in the lender's history. The decision was the result of more than 2 years of negotiations among the Bank's regional and non-regional shareholders to empower Africa's premier development bank to meet its High-5 development goals for the continent. An applause rang through the stately auditorium of the Sofitel Abidjan, Hotel Ivoire, around 5.30 in the evening after the decision was announced. At a press conference after the meeting, AfDB president Akinwumi Adesina said, "Today is a day of joy for Africa...because the shareholders of the African Development Bank trust the...Bank and have provided this financing." "The extra capital would help the bank finance energy, climate, and agricultural projects, as well as support infrastructure needed for the success of a continental free-trade zone."
According to African Development Bank President, Akinwumi Adesina, "We have achieved a lot, yet there is still a long way to go. Our responsibility is to very quickly help improve the quality of life for the people of Africa. This general capital increase represents a very strong commitment of all our shareholders to see better quality projects that will significantly have an impact on the lives of the people in Africa - in cities, in rural communities, and for millions of youth and women."
With the new general capital increase, the Bank plans to do more, with the following expected results: 105 million people to have access to new or improved electricity connections; 244 million people to benefit from improvements in agriculture; 15 million people to benefit from investee projects; 252 million people to benefit from improved access to transport; and 128 million people to benefit from improved access to water and sanitation.
Adesina noted that "the Bank will continue its leadership role on infrastructure development, strengthening regional integration, helping to realize the ambitions of the African Continental Free Trade Area, supporting fragile states to build resilience, ensuring sustainable debt management, addressing climate change and boosting private sector investments. We will do a lot more. This is a historic moment."
He added: "I applaud the shareholders for their strong confidence in the Bank and for boosting support for Africa's development".
President Adesina, Bank senior vice-president Charles Boamah and vice president for Finance and Bank Chief Finance Officer Bajabulile Swazi Tshabalala, will be available for interviews and further comment about the increase.
Victor Oladokun, Director, Communications and External Relations Department, African Development Bank
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