Joint IFI/DFI action plan to respond to the financial crisis in Africa

1. As the largest and most active international financial institutions (IFIs) and development finance institutions (DFIs) investing, lending, and providing advisory services in Africa(1), the African Development Bank Group, the Agence Française de Développement Group, the European Investment Bank, the Development Bank of Southern Africa, German Financial Cooperation (through KfW), the International Islamic Trade Finance Corporation, and the World Bank Group, are launching a Joint IFI/DFI Action Plan to respond to the Financial Crisis in Africa coordinated through the African Financing Partnership (herein after referred to as "Joint Action Plan") to support the region's financial systems and lending to the private sector. The objectives are threefold, to:

- In a coordinated manner and building on each institution's capabilities, deploy rapid and sizeable financial assistance to the private sector to:

  • Promote trade
  • Strengthen Africa's financial sector
  • Increase lending to infrastructure projects and other real sectors of the economy such as agribusiness and small and medium enterprises (SMEs) experiencing a shortfall in liquidity
- Use financing from DFIs and IFIs as a catalyst to engage other stakeholders and mobilize financial resources for the region;

- Facilitate coordination and policy dialogue between key private and public sector stakeholders in countries affected by the crisis.

2. The Joint Action Plan is a key part of our institutions' efforts to address the effects of the global economic crisis on the private sector in Africa. The initiative recognizes that pooling resources and expertise will enable governments and institutions to more effectively reduce the humanitarian toll in the region resulting from the global economic slowdown. The achievements of the past decade, which has seen robust economic growth, macroeconomic stability, and welcome progress in poverty reduction (and toward the Millennium Development Goals) in a growing number of African countries, are now at risk as the world faces the gravest economic crisis in more than sixty years. An effective crisis response requires fast and coordinated action by all stakeholders: African policy makers, local and regional financial institutions, African institutions, IFIs, and DFIs.

3. While all countries of the region face the challenge of global financial retrenchment, our approach recognizes that countries differ very significantly in terms of their financial vulnerability and their need for support.