BADEA: Newly formed Arab–Africa Financial Consortium will promote continent’s speedy growth

African leaders, heads of financial institutions on the continent, and executives in business have received assurances from Dr. Fahad Aldossari, the chairman of the Board of Directors of the Arab Bank for Economic Development in Africa (BADEA), that the recently formed Arab-Africa Financial Consortium (AAFC) will do everything within its mandate to ensure that it achieves its set objective of promoting Africa’s rapid development over the next 50 years.

In his remarks at a leader’s breakfast held in conjunction with the launch of the AAFC and BADEA 50th anniversary at the Kempinski hotel in Accra on Sunday, July 21, 2024, Dr. Fahad Aldossari acknowledged the critical role played by President Akufo-Addo of Ghana and the African Union as champions of financial institutions in the establishment of the Arab-Africa Financial Consortium. He also noted that BADEA will take immediate steps to institutionalise the AAFC over the next 50 years, starting now, by appointing a secretary to oversee and organise its activities.

“Today is also a special day as we feel honoured and grateful to his excellency, the President of Ghana, the African Union Champion of Financial Institutions, who not only welcomed BADEA’s anniversary and hosted s i in the beautiful city of Accra but also elevated the partnership and coordination of financial institutions to support Africa,” Dr. Fahad Aldossari stated.

“With His Excellency’s call to establish the Arab-Africa financial consortium following the successful launch of the African financial institutions’ network last Friday, I can confirm that BADEA will spare no effort in ensuring this consortium succeeds in realising the vision of Arab-Africa financial institution collaboration and coordination for leveraging resources for the continent,” he added. 

Critical investments

In his keynote speech, President Akufo-Addo noted that BADEA has been instrumental in the development of the African continent over the past 50 years. He expressed confidence that the next 50 years will bring even more exciting developments in the relationship between the African continent and the Arab world, particularly with the creation of the AAFC.

According to President Akufo-Addo, the Arab-Africa Financial Consortium (AAFC) should focus on and advance four important areas: infrastructure development, trade and investment growth, women and youth empowerment, and human capital investment.

President Akufo said that “over the past five decades, BADEA has been a beacon of hope, a catalyst for development, and a symbol of the enduring bond between our two regions. Since its inception in 1974, BADEA has been instrumental in fostering economic development and cooperation between African and Arab countries.

“It has played a pivotal role in financing and supporting numerous projects across the African continent, from infrastructure development to healthcare, education, and agriculture. These projects have not only contributed to the socio-economic development of our nations and continents but have also strengthened the partnership between Africa and the Arab world,” the president added. 

BADEA’s commitment to Africa, according to President Akufo-Addo, “is evident in its track record.” He said that “over the past 50 years, BADEA has financed over 700 projects in more than 44 African countries with a total value exceeding US$6 billion.” These projects, Akufo-Addo said, “have created jobs, improved living standards, and spared economic growth across the continent.”

“BADEA has not only evolved to meet the expectations of the continent and shareholders but also to demonstrate agility and responsiveness to meet development challenges from the COVID-19 response to becoming pledges in the Arab coordination group on food security, climate change, and resilient infrastructure. As we celebrate fifty years of Arab-African cooperation through BADEA, let us reaffirm our commitment to this vital partnership.

“Let us build on the successes of the past and work together to address the challenges of the future. Let us strive to create a more prosperous, inclusive, and sustainable future for all our people. I call on all stakeholders—governments, the private sector, civil society, and international organisations—to join hands in this endeavour,” President Akufo-Addo said. 

Five pivotal areas

The African Development Bank Group’s President, Dr. Adesina Akiwumi, stated that the revitalised Arab-African relationship ought to concentrate on five key areas. He stated that energy development is at the top of the list, followed by the exploitation of the rich green mineral resources on the continent, mobilising support for green infrastructure in Africa, food security, and, finally, making sure that the Africa Investment Forum initiative serves as the focal point of the new push for Arab-African partnership.

“In the last five years, because of our collective work together, we have been able to attract over 180 billion dollars in investment interest into Africa. So, I am fully confident that as we structure the Arab and African financial institutions’ partnership around this (Africa Investment Forum) effort, we can deliver even more results.” Dr. Akiwumi said.

BADEA

The Arab Bank for Economic Development in Africa (BADEA) was established under the resolution of the 6th Arab Summit Conference at Algiers on November 28, 1973. The bank began operations in March 1975. BADEA is a financial institution owned by eighteen Arab member countries of the League of Arab States (LAS), which signed its Establishing Agreement on February 18, 1974.

The Bank is an independent international institution enjoying full international legal status and complete autonomy in administrative and financial matters. It is governed by the provisions of its Establishing Agreement and the principles of international law.

The Arab Coordination Group (ACG), an alliance of Arab development institutions established to promote and coordinate financial and technical assistance to developing countries, primarily in the Arab world and Africa, is partnering with BADEA to launch the Arab-Africa Financial Consortium (AAFC).

The ACG comprises several key institutions, including the Abu Dhabi Fund for Development, the Arab Bank for Economic Development in Africa, the Arab Fund for Economic and Social Development, the Arab Gulf Programme for Development, the Arab Monetary Fund, the Islamic Development Bank, the Kuwait Fund for Arab Economic Development, the OPEC Fund for International Development, the Qatar Development Fund, and the Saudi Fund for Development.

Several other key Arab institutions will also play an instrumental role in leveraging the partnership between Arab and African countries through the establishment of the AAFC. Among them are the Abu Dhabi Investment Authority, SaudiExim Bank, UNIDO ITPO office Bahrain, AIM Global Foundation, and the Arab Authority for Agricultural Investment and Development (AAAID).

The rest are the Public Investment Fund (PIF), Halal Products Development Company, the Emirates Investment Authority, the Kuwait Investment Authority (KIA), the Investment Corporation of Dubai, the Qatar Investment Authority, the Oman Investment Authority, the Islamic Trade Finance Corporation (ITFC), and the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC).