This vital short-term response must not cause us to lose sight of the long-term vision and the need to transform our economies and societies. AFD Group also made considerable progress in these areas in 2020 through its organization of the “Finance in Common Summit (FiCS),” which brought together public development banks from around the world, with an eye to COP26 in November 2021. The Group also increased its research and development capacity by hosting the Fund for Innovation in Development (FID), chaired by Esther Duflo. AFD has worked to expand the evaluation of its projects on the ground as requested by the elected officials and supervisory government ministers Jean-Yves Le Drian, Bruno Le Maire and Sébastien Lecornu.
- €12.1 billion in new commitments.
- €8.8 billion in disbursements (35% more than in 2019).
- 996 new development projects in all sectors.
- €3 billion for the Covid-19 response, including €1.2 billion for the “Health in Common” initiative in Africa and the Middle East with French stakeholders.
- €5.4 billion for the climate to help meet its pledge of €5 billion in climate funding made at COP21 in 2015.
- €4.9 billion for Africa, which amounts to 46% of AFD’s total commitments, of which €511 million was devoted to the G5 Sahel countries.
- €565 million in funding for biodiversity.
- With €2 billion in commitments in 2020, our Proparco subsidiary became a leading European private sector finance institution.
- The “Finance in Common” Summit, convened by AFD and IDFC, brought together 450 public development banks from around the world, to which AFD contributed €1.7 billion in funding in 2020.
- In 2020, AFD Group generated positive net income of €40 million. This attested to the robust nature of its economic model.
“In light of the global social and environmental crisis, which has been exacerbated by the Covid-19 pandemic, AFD Group has taken action in its countries of intervention, starting with Africa, to respond to short-term health and economic challenges, while continuing to pursue ambitious paths towards achieving the Sustainable Development Goals (SDG) and honoring the Paris Climate Agreement. The Group’s actions fall within the framework of the important planning bill on solidarity, development and the fight against global inequalities put forward by the Minister for Europe and Foreign Affairs, Jean-Yves le Drian,” says Rémy Rioux, Chief Executive Officer of AFD Group.
1. In response to the crisis, AFD Group acted with determination and agility by mobilizing all the relevant French stakeholders.
Right from the start of the pandemic, AFD Group mobilized to meet the health challenges generated by the crisis. France’s “Health in Common” initiative, approved on April 2, 2020, provided an early and ambitious response to the crisis, enabling contributions of €1.2 billion and the launch of 63 projects to reinforce health care systems in 33 countries in Africa and the Middle East, which are priority countries for our development policy. This specific initiative is part of a broader response to the Covid-19 crisis, which has mobilized nearly €3 billion, 60% of which has already been disbursed. A total of 42 million individuals will benefit from improved access to health care, and 25 million will receive better social protection.
These efforts are continuing in 2021 through the “Health in Common 2” program, which is closely linked to the ACT-A multilateral response and implemented by #TeamEurope, with the help of our European partners. All in all, the Group will commit €1 billion, including at least €500 million in loans and over €150 million in donations for health and social protection this year.
In the current situation, AFD Group has fully stepped into its role as an operational platform to mobilize French stakeholders capable of providing a helpful response to the crisis. This is true for the network uniting Institut Pasteur, INSERM, IRD, the Aga Khan Foundation, and many NGOs, including ALIMA, Action Contre la Faim, Handicap international and AMREF, which have all benefited from AFD funding.
In addition to its health response, AFD Group has been committed to responding to the needs of economic stakeholders during the crisis. One striking example is the “Choose Africa Resilience” initiative, led by our Proparco subsidiary, which added €1 billion to the “Choose Africa” program launched in 2018, bringing the total amount to €3.5 billion. This additional amount in 2020, along with aid from a State guarantee approved by Parliament, made it possible to support more African small and medium-size enterprises (SMEs), which have struggled as a result of the crisis. According to the mid-term review of the initiative, €2 billion in funding has been committed, which has benefited over 16,000 companies and tens of thousands of small entrepreneurs.
There was a special focus on the situation in Africa, with €4.9 billion in commitments made in 2020, particularly to G5 Sahel countries: €511 million was committed last year to benefit these five countries. In total, 65 million Africans, including 11 million in the Sahel, will benefit from AFD Group funding.
2. In the midst of the crisis, AFD Group has maintained its vision for long-term issues (such as climate, biodiversity and gender equality) in partnership with public development banks from around the world
AFD Group intends to contribute practical and useful assistance to major multilateral events in 2021 to demonstrate that it is possible for our economic models and societies to change to become more sustainable and less marked by inequality. This will entail an ongoing dialogue, which is both respectful and practical, and which brings together diverse development experiences from around the world.
This was the goal of the first “Finance in Common (FICS)” summit, organized in November 2020 under the High Patronage of French President Emmanuel Macron and with the participation of the Secretary-General of the United Nations and the Managing Director of the IMF. For the first time, the summit brought together the 450 public development banks from around the world, which together represent 10% of all public and private investments each year.
The ambitious joint declaration approved at the Summit clarified the role of these public financial institutions and established a consensus that both public and private sectors should bring global and local perspectives to bear in the transformation of the global economy – and of our societies – to achieve sustainable and resilient development. A second Finance in Common summit will be organized in 2021. FiCS will also contribute to the summit on financing African economies, which will be convened by French President Emmanuel Macron on May 18, 2021. AFD will participate actively in this event through its role as chair of the International Development Finance Club (IDFC). It contributed €1.7 million in funding to its peers in 2020.
In light of the environmental crisis, AFD Group invested €5.4 billion in projects with positive climate impacts in 2020 to help meet France’s pledge at COP21 in 2015 to commit €5 billion per year to climate funding. The Group’s funding for biodiversity reached a record amount of €565 million in 2020 (a 25% increase compared to 2019), through ambitious programs aimed at protecting indigenous peoples in the Amazon, promoting agroecology throughout the Great Green Wall in the Sahel, and responding to food security challenges in the Boucle du Mouhoun and Est regions of Burkina Faso. In 2020, the Group’s funding helped protect or restore a total of 12 million hectares of natural areas. AFD has set the goal of reaching €1 billion in funding for biodiversity by 2025 and devoting 30% of its climate funding to projects promoting biodiversity by the same year. The Group is actively helping to prepare for the COP15 Biodiversity talks to be held in October in Kunming.
AFD’s priority of gender equality guides all of its activities. One hundred percent of our projects of projects are now analyzed through a gender lens and 67% have a significant or primary objective related to gender equality. A Support Fund for Feminist Organizations (FSOF) was launched in July 2020 in partnership with the Ministry for Europe and Foreign Affairs. With €120 million mobilized for three years, the fund promotes the financing of civil society feminist organizations in the partner countries of France’s international cooperation and solidarity policy. These organizations work to promote gender equality and to bring about lasting changes in social relations.
3. Despite the crisis, AFD Group was able to maintain its financial equilibrium, improve evaluation of the impact of its activities, and move towards greater innovation
In 2020, AFD Group generated a net income of €40 million, which attested to the robust nature of its economic model. However, these results were significantly lower than in 2019 because of a sharp rise in financial assistance due to the crisis. The size of AFD Group’s consolidated balance sheet reached nearly €55 billion at the end of 2020. One third of the €10 billion in financing in the financial markets in 2020 was allocated through climate bonds or bonds aligned with Sustainable Development Goals. After becoming the first public institution to issue a climate bond, AFD established a new innovative SDG bond framework by connecting its bonds with loans, which are selected according to their contribution to the SDGs.
Finally, AFD Group continues to progress each year in its evaluation of the projects it funds and in innovation for development. This approach meets a threefold requirement of accountability, effectiveness, and innovation. The second edition of our assessment report, covering 2019 and 2020, the first part of which was published this week, highlights the many projects that underwent scientific assessment.
A total of 44% of projects completed over the past three years were evaluated, with a particular focus on countries in the Sahel, for which 88% of projects were evaluated. In 2020, AFD also had the honor of hosting a new “Fund for Innovation in Development (FID)” chaired by Esther Duflo. It also hosted two major international symposiums, one entitled "The Visible Hand,” devoted to the role of public development banks, and the other marking the release of the results of three years of research on inequality, financed by the European Union and carried out by AFD.
AFD seeks to respond to crises effectively while continuing to pursue its long-term vision, based on the assessment of past actions, and insights from development research.