As part of efforts to boost investment on the continent, the African Development Bank (AfDB) and the Japan International Cooperation Agency (JICA) have signed a $350 million loan to finance and support private sector operations in Africa.
The loan comes under the Enhanced Private Sector Assistance (EPSA) initiative, which is a component of Japan’s Official Development Assistance to Africa. The fifth version of EPSA, for an amount of $4 billion, was signed by the Bank and JICA at the Eighth Tokyo International Conference on African Development (TICAD 8), held in Tunis last August.
Earlier, the president of the African lender, Mr Akinwumi Adesina, had wooed Japanese investors to boost the presence on the continent after he led a delegation to Japan to discuss investment opportunities in Africa with senior government officials, large Japanese companies, development partners, parliamentarians and the African diplomatic corps.
JICA President, Mr Tanaka Akihiko, said the loan represented a crucial step in Japan’s efforts to work with AfDB to support Africa as it faces the challenge of navigating multiple compounded crises, including issues of debt sustainability and the impact of the war in Ukraine.
“The private sector in Africa is fundamental in creating jobs for the prosperity and progress of Africa. Although the private sector has been confronting unprecedented economic and social pressures, we are confident that the Bank’s Non-sovereign Operations supported through this concessional loan will play an essential role in addressing these pressing issues.”
On his part, Mr Adesina thanked the government of Japan as well as JICA, for their continued support to the bank and Africa and invited JICA to collaborate with the AfDB Group in other critical areas, such as refining the food and agriculture delivery compacts developed by African countries during a January food summit held in Senegal to tackle the continent’s food insecurity.
“JICA’s support would be crucial in the implementation of the Special Agro-processing Industrial Zones, which will be the biggest game changer in Africa’s agriculture. It will transform rural economies, reduce food losses, process and add value to crops produced in rural areas and create jobs,” Mr Adesina added.
“Support young people to go into agriculture. Youth are Africa’s best asset, but they lack access to finance. The Bank is establishing youth entrepreneurship investment banks to provide young people with financial and technical support throughout the business cycle,” Mr Adesina urged.
Mr Tanaka agreed with the areas highlighted by the African Development Bank chief, saying they were important to Japan’s agenda of future collaboration with Africa.
On the need to create jobs for young people, the JICA president said: “It is silly not to take advantage of active youth in Africa. In Africa, you have an abundance of youth, but in Japan, we have an abundance of an old population.”
He said it was important to explore ways of promoting interaction between Japan’s university students and those of Africa to foster an exchange of knowledge and skills. He agreed that JICA should hold further discussions with the African Development Bank Group to look into other issues raised by Adesina, including the digitization of primary healthcare operations and the establishment of the African Pharmaceutical Technology Foundation to be hosted in Rwanda’s capital, Kigali.