Agence Française de Développement’s 2014 Results: Over EUR 8 billion for a more equitable and more sustainable world
Anne Paugam, Chief Executive Officer of AFD, today presented the key figures for the activity in 2014 of the central actor in France’s Official Development Assistance. With EUR 8.1 billion of commitments, up 4%, AFD has achieved another historic year for its activities to support a more equitable and more sustainable world.
“AFD’s mandate is central to the challenge of the coming years, which is to bring about new development models that ensure both the prosperity of the whole of the world’s population and preserve the planet. We contribute to this by tailoring our actions to the needs of partner countries”, explained Anne Paugam, Chief Executive Officer of AFD.
AFD is a public institution that implements France’s policy for development financing. It operates on four continents, in over 90 countries and in the French overseas territories, and works on a daily basis to meet its partners’ requirements. This results in investments in human capital, support for the private sector, financing for public transport projects, and assistance for the public policies of both governments and territorial authorities, in order to promote more equitable and more sustainable development trajectories.
AFD addresses the challenges of climate change, the impacts of which concern the entire planet, by showing on a daily basis that there are concrete solutions that reconcile climate and development. In 2014, 53% of AFD’s financing for development in developing countries generated positive impacts for the fight against climate change and 30% for PROPARCO, its private sector financing arm.
AFD’s actions bring about concrete impacts. Between 2012 and 2014, ongoing projects have:
- Got 2 million children into primary and secondary school;
- Improved housing for 2.3 million people;
- Provided 2.7 million people with access to a sustainable source of drinking water;
- Assisted the development of 246,000 small businesses;
- Supported 771,000 family farms;
- Preserved and sustainably managed 32 million hectares of natural spaces allowing biodiversity conservation.
Historic year for the climate: 53% of financing
In 2014, 53% of AFD’s financing for development in developing countries and almost 30% of its subsidiary PROPARCO’s financing for the private sector also had positive impacts on the fight against climate change as part of one of the most ambitious climate strategies among international development finance institutions, which was established at the request of the French Government. In 2014, it accounted for over EUR 2.8bn of financial commitments, including EUR 2.53bn for AFD. Since 2005, EUR 18bn have been earmarked by AFD for projects that reconcile development and climate.
AFD’s first climate bondsFor the first time, AFD has issued climate bonds with a 10-year maturity. They will finance projects that contribute to development, but also to the fight against climate change.
This EUR 1bn “climate” bond issue is the first of its kind conducted by a French public agency. It marks a new trend in the design of financial instruments to support the transition towards a low-carbon economy. Through its rigorous and innovative methodology, based on a systematic assessment of the carbon footprint of funded projects, AFD is seeking to demonstrate to financiers that it is possible to channel part of international finance towards “climate” assets.
Sub-Saharan Africa: Record commitments
In 2014, financing in Sub-Saharan Africa reached the record volume of EUR 2.95bn, i.e. 36.5% of AFD Group’s total financing (45% of financing in foreign countries). Through this strong commitment, which is in line with the objective set by the French President to provide EUR 20bn of financing to the continent by 2018, AFD aims to support the emergence of Africa in its growth trajectories. The projects supported by AFD provide access to essential services, develop sustainable cities, family farming, preserve natural resources, and build infrastructure and job-creating enterprises.
Crises: Specific intervention methods and tools
In Mali, the Central African Republic, Guinea… in countries in armed conflict or recently emerged from conflict, AFD has tailored its operating methods and tools to the specificity of these contexts. The aim is to be more responsive and work more effectively with the different partners and actors of emergency relief and development. Key projects in 2014 include:
AFD and CIRAD launch Climate Challenge, an international competition on agricultural and forestry innovation to address climate change
Call for projects launched at Convergences World Forum on 8, 9 and 10 September 2014
Agence Française de Développement (AFD) and the Agricultural Research Centre for International Development (Cirad) have launched the first international competition « Climate Challenge Agriculture and Forestry », which promotes agricultural and forestry innovation to address climate change.
Anne Paugam, Chief Executive Officer of AFD, and Michel Eddi, Chairman of CIRAD presented this competition on 9 September 2014 during the 7th edition of the Convergences World Forum, which gathers public, private and solidarity-based actors who are working to achieve the Millennium Development Goals.
Agence Française de Développement and Cirad have launched the competition “Climate Challenge Agriculture and Forestry” because climate change poses a major challenge to agriculture and a threat to both world food security and poverty eradication. AFD is particularly active in supporting developing countries in the fight against climate change. For Cirad, the topic of climate change has been central to the research it has been conducting for over 15 years with its partners in the South, with the aim of adapting agriculture in these countries to this major constraint.
This international competition aims to promote innovation and fast track the transfer and dissemination of technologies and knowledge, which are essential in bringing about innovative solutions to be devised for the future. It will support the creativity and success of exemplary projects, led by candidates from Africa, the Mediterranean, Asia, Latin America and the French Overseas : individual actors, farmers’ organizations, financial institutions, actors from the economic and social sectors, local authorities and territories.
It highlights four categories of project :
- Climate change mitigation in agriculture and livestock farming
- Climate change mitigation in the forestry sector
- Substitution and processing of agricultural and forestry products
- Adaptation to climate change and water resources management
Projects must be submitted by 1 December 2014 on the website dedicated to the competition, www.challenge-climat.com, via the online application interface.
Innovation: A new approach to mobilizing actors
Technical, methodological and operational innovations that create new local dynamics, as well as actions to build inclusive economies, will be promoted. They allow actors and family farms to adapt their practices to climate change, while ensuring that their standard of living and quality of life improve.
150 preselected applications, 12 major projects selected, 4 award winners
150 of the projects submitted will be selected on the basis of the impact their innovation has on climate change, their feasibility, viability, and the possibility of replicating them, as well as their utility and overall coherence. A Selection Committee composed of experts from the development sector will select 12 major innovations, which will be transferred to the final jury.
« This competition provides an opportunity to mobilize and pool energies from the North and South for innovative methods that need to be implemented to support sustainable development. Agriculture and forestry are two key sectors. They are vectors of innovation to address climate change and provide solutions to the major challenge of world food security. It is for this reason that I am extremely pleased to launch Climate Challenge in partnership with Cirad » says Anne Paugam, Chief Executive Officer of Agence Française de Développement (AFD)..
« This competition provides the opportunity to promote innovations that have come about as a result of research on what we call ‘climate-smart agriculture’. These new agricultural practices should provide a response to the threefold challenge of food security, climate change adaptation, and the sustainable increase in production, by promoting the development of employment in rural areas. They are particularly vital for the future of family farming, but also for conceiving and building the world of tomorrow, based on the principles of sustainable development”, », points out Michel Eddi, Chairman of CIRAD..
Awards given by prestigious jury at 2015 International Agricultural Show
The 12 initiators of innovative projects will be invited to France to present their projects at the award ceremony, which will be held in Paris at the International Agricultural Show (21 February to 1 March 2015).
The final jury comprises personalities from the field of innovation and social and economic investment and include:
- Brice Lalonde :Special Advisor on Sustainable Development to the UN Global Compact, former Under-Secretary General of the UN, former Secretary of State then Minister for the Environment from 1988 to 1992.
- Navi Radjou : consultant in innovation in Silicon Valley, father of the concept of Jugaad and frugal innovation.
- Ibrahima Coulibaly : Special Ambassador to the UN for the International Year of Family Farming, Vice-President ROPPA (Network of Farmers' and Agricultural Producers' Organizations of West Africa), President of CNOP (National Coordination of Farmers' Organizations in Mali).
- Jean-Christophe Debar : Director of the FARM foundation (Foundation for World Agriculture and Rurality).
For Brice Lalonde, President of the Jury: « Humanity is facing one of its greatest challenges: how to ensure development for all without harming the planet. Agriculture has a full role to play in this challenge and the solutions may well come from countries in the South, which have a proven creative force. So, I am proud to be contributing to bringing out solutions, via this challenge, that will allow us to feed the world, while protecting nature, the mother of future harvests. »
Find out more at :
Climate Challenge Agriculture and Forestry: www.challenge-climat.com
Le Cirad : www.cirad.fr
French Ministry of Foreign Affairs and International Development (MAEDI): www.diplomatie.gouv.fr
Video interview: Paris, Ouagadougou, the same combat?
In this interview, which takes us through the streets of Paris, the urban planner Guillaume Josse uses some urban objects from our everyday lives to give us keys to understanding the challenges facing cities in both the “South” and “North” alike.
First and foremost conceive cities as networks
Each city, however modern it is, is like a grid, a layering of networks, most of which are visible in the urban landscape. Be it for electricity, gas, telecoms, wastewater or stormwater drainage networks: all these functions are directed towards the same goal: guarantee the safety and well-being of city dwellers and make their city a better place to live in.
The first feature of a city in the South: weak public management
The most common aspects of a city in the “North”, which we take for granted – as they have been part of the daily lives of its residents for a very long time – either still do not exist or are extremely rare in cities in the “South”. Ordinary urban objects come to mind, for example, street signs, drain covers, street lights, paved roads, which respectively contribute to addressing and identifying places and their residents, preserving hygiene and public health, and the movement of persons and consumer goods. These are all missions for which local authorities are responsible.
Southern cities generally stand out for the lack of such networks, which are developed and operate efficiently. At best, you can see some points in common, such as phone networks, roads, streets, but with no asphalt, no paving stones and they are flood-prone because the pipe systems are not functional or are saturated; neighborhoods and dwellings have no signs, there is a lack of street lighting, etc.
Land registers and signage: prerequisites for urban management
In Paris, we take the street signs for granted. However, they do not exist in most cities and capitals in developing countries. Yet without such signage, it is impossible to send mail or for tax statements to be sent, taxes to be collected properly, for which there is ultimately no system to make people pay. This situation is one of the symptoms of the lack of fully operational land registration systems in these countries, for example, to manage land units and the history of land plots.
In such conditions, it is difficult or even impossible to know exactly who is living in such and such a place, or how many households, children, elderly or disabled people live there. It is equally impossible to determine who is the owner or tenant of the place in question and therefore, for example, to be able to collect sales taxes.
Achieve an effective combination of policy, administration and technical aspects
While addressing is important, it is not enough to paint a number on a door, as we see in many African countries, hoping it will be sufficient to solve the problem. The process to organize the life of the city, its management and its development is much more complex and takes much longer to implement. The entire management in public administration needs to be organized and overhauled, as this is the instrument which allows the State to take stock, know what is happening in real time, and manage the city in the long term. Street signs are a sort of symbol of urban management, which covers most of the services that city dwellers benefit from in their daily lives.
The main challenge for these countries and development aid institutions, including AFD, is to know how to create all these essential urban networks, set them up, finance both the investment in this infrastructure and implement adequate services to maintain them.
For example, without sanitation networks, in Southern cities all the wastewater is discharged into the street, parks and natural waterways. The challenge may not be to achieve a result as close as possible to Paris, which is a very modern city, but at the minimum to have essential services to prevent waste and wastewater from staying in houses or polluting rivers, keep streets passable and allow city dwellers to have access to drinking water.
The Chalon neighborhood: an example of successful urbanization
The transformation of this Parisian neighborhood, which was for a long time left to its poverty, shows how there is no predefined technique or model able to create a modern, pleasant and well-managed city. You have to think simultaneously of the equipment, housing, the networks I mentioned before, the type of activities that you want to develop there (offices, a business center, or a green space for example) and, especially, connect all this up with the transport links. All these projects require comprehensive political thinking in the sense of “city management”, which must lead to public policies that need to be coherent and complementary within a given area. The other aspect is the way in which these operations are conducted, first by taking the duration into account: indeed, we are talking about projects for which the financing and works are spread over 20 or 25 years. In this respect, you need to ensure that you will stay the course thanks to institutions that are politically, technically and financially strong enough to lead major projects.
“The city finances the city”, as the operation is financed gradually by the gains made by the local authority when it sells the land that it bought cheaply in the poor neighborhoods after having developed them. These gains finance the equipment and, at the end of the day, urban operations are self-financed over a period of 20 years or more. This principle of development generally does not exist in the countries where AFD operates. This is a real shortcoming, which goes well beyond the financial constraint proper – because a small cash advance would be sufficient to buy land. What is even more fundamental is the issue of how local authorities operate and their ability to lead these projects and, from a technical perspective, to have sufficient human resources to design and implement a development policy like in the Chalon neighborhood.
How to proceed, following the “City finances the city” principle
What happens in practice? The public authority starts by taking possession of the rundown neighborhoods via expropriations, compulsory purchase or simply by acquisition. Once the public authority has taken ownership of the land, it can demolish, rebuild, develop and redevelop as it sees fit in order to create new neighborhoods, which will continue to develop in a more or less positive way depending on the choices that have been made.
Although cities everywhere are made up of the same things, they do not operate in the same way.
The reason partly relates to financing. The Mayor of Paris has €4,000 per year and per resident to maintain and invest. The Mayor of Ouagadougou (municipality with 1,300,000 residents) has €20 per year and per resident. By way of comparison, the budget of this city, the capital of Burkina Faso, is half the budget of the town of Rodez, which has 25,000 residents. The Mayor of Lomé will have €8 to €10 per year and per resident, the mayor of a small town in Benin will have half a euro per year and per resident…...
The challenge therefore obviously lies in increasing financing and the capacity for a local authority to have sufficient financing available to invest in the area under its jurisdiction and maintain it. There is a colossal gap today between cities in the North and cities in the South and our challenge is to manage to bridge it.
AFD and GIZ (German technical cooperation) signed a €6m financing agreement for a water supply project in Juba, the capital of Southern Sudan, on 7 April 2011. This AFD grant completes the one allocated by the German Ministry of Economic Cooperation (BMZ) for the same amount.
This Franco-German cofinancing aims to develop the urban water sector in Southern Sudan.
It comes just 3 months after the self-determination referendum, which was held in January 2011 and will lead to the official creation of the 54th African State (and 193rd State in the world) on 9 July 2011.
Latrines recently built in a primary school
Everything needs to be rebuilt in this fragile State, which is just emerging (since the 2005 peace agreements) from a civil war that lasted over 20 years, particularly in the field of basic infrastructure.
Only 5% of the population has access to sanitation
The water and sanitation sector is no exception: it is estimated that only 29% of the population has access to drinking water and only 5% to sanitation. In cities, access to drinking water is even worse: practically none of the networks are working and the access rate is estimated at 14%. These statistics mean that Southern Sudan ranks the lowest worldwide.
This alarming situation is likely to be exacerbated further by migratory flows, with on the one hand a strong rural exodus (80% of the population are still rural dwellers), and on the other hand the return of refugees and internally displaced persons, which could gather pace after the creation of the new State.
Several types of water vending kiosks will be tested to determine which one is the best suited to the situation in Southern Sudan
Institutional progress has, however, been observed since the peace agreements: a sectoral policy has been implemented since 2009, a Ministry of Water Resources and Irrigation (MWRI) now coordinates the sector, an Urban Water Corporation has been set up, etc.
But these reforms have yet to be fully achieved and the lack of capacity of national actors makes it difficult to implement them.
Capacity building is a priority in this context and is consequently a core aspect of this project, which is based on 4 components:
- Strengthening the Ministry of Water Resources and Irrigation (MWRI)
- Reforming the Southern Sudan Urban Water Corporation (SSUWC)
- Implementing pilot measures in the city of Yei
- Capacity building for stakeholders in the water sector
The strategic choice of the city of Yei
- It is located in the south of Southern Sudan and should be spared from the different levels of conflict likely to occur with the separation from the North,
- It is at the crossroads of roads linking the country up with Uganda and DRC and has a potential to become a major secondary center. This will limit migrant flows towards the capital Juba.
In Yei, the project will create a primary distribution network, roughly twenty water vending kiosks, boreholes, water towers, public latrines (particularly in schools), hygiene promotion campaigns, a wastewater and sludge treatment basin… These facilities will directly benefit 20 000 residents and improve their living conditions.
The challenge is, however, much broader: Yei will in reality be a “testing center” for the implementation of the national water policy. An operator will be established there to manage operating and, for the first time in Southern Sudan, tariffs will be set with the aim of covering operating costs in order to ensure the service is sustainable.
A national water sector training center will also be set up.
These pilot measures will build the capacities of stakeholders at all levels (national, regional and local), taking into account the decentralization laws. They will apply to administrations just as much as to the private sector (small traders, electrical engineers, electricians…).
In the photo, First row: Didier GREBERT, AFD – Christian Bader, French Consul General – Manfred Van Eckert, GiZ’s representative in Southern Sudan
Second row: Isaac Liabwel, Secretary General of the Southern Sudan Ministry of Water Resources and Irrigation – Norbert Hagen, head of GIZ’s Urban Water Program.