The Country Relations (CR) department plays a major and vital role in the growth and success of the Corporation by developing and maintaining strong relationships with African states and key stakeholders including the business community and international organizations, while reinforcing the multilateral status of AFC
In addition to managing government relations affairs for the Corporation, CR drives equity mobilization with the goal of broadening AFC’s shareholders base and building and maintaining strategic partnerships and cooperation geared towards public and private sectors to achieve the mandate of the Corporation.
The CR Department’s core strategy is anchored on creating an operating framework that positions the Corporation as a catalyst for infrastructure development across Africa. Acting as a cross-department enabler, CR acts as an origination engine for the Corporation.
AFC has two levels of Membership:
I. Membership Only
A prospective Member Country/State may join the AFC by signing the Instrument of Adherence and ratifying its Constitutive Instruments, namely the AFC Establishment Agreement through its cognitive/constituent authority.
II. Membership & Shareholding
Member States may elect to make financial commitment/investment and become shareholders through their designated entities (e.g., Central Banks, Ministry of Finance, Sovereign Wealth Funds and State Pension Funds or development banks) at any time convenient to the member country. Regional or sub regional development financial institutions are also eligible to subscribe in AFC’s capital.
Membership and subscription to AFC shares not only deepens the relationship but reinforces the mutual support that is critical between African multilateral financial institutions and African sovereigns. In order to develop Africa and meet its considerable infrastructure, trade and industrial financing needs and to enhance its export earnings and employment creation; an active collaboration and alignment of financial interests is advisable and indeed recommended between related stakeholders.
As a world-class multilateral financial institution with the goal to bring the world to Africa, AFC welcomes shareholding from strategic non-regional institutional investors looking to have African infrastructure as an asset class.
Additional information on investing in AFC, including various capital subscription options, are available upon the receipt of an expression of interest to invest in the Corporation.
Ratification of AFC Membership
Member countries, upon acceding to membership, are required to ratify AFC’s Constitutive Instruments in line with their national laws, essentially domesticating the AFC Treaty into local law, in accordance with the requirements of the Country’s internal protocols.
Subject to the country’s laws, this may include both ratification by:
- the Cabinet/ Council of Ministers, and
- the National Assembly/ Parliament/ President.
Membership of AFC is open to all African Countries/States. The Corporation currently has thirty-two (32) Member States:
- Nigeria*(Host Country)
- Burkina Faso
- Cape Verde
- Côte d’Ivoire
- Congo Brazzaville
- DR Congo
- The Gambia
- Sierra Leone
*Sovereign Shareholders of AFC
BENEFITS OF AFC MEMBERSHIP
The key benefits of AFC membership are highlighted below:
- Competitive Financing for Projects in Member Countries
Sovereign states, upon accession to membership, grant the Corporation a preferred creditor status and other standard immunities and privileges relevant for multilateral institutions. In some cases, this obviates the need for political risk insurance to cover country risk on project loans. Given that project risk insurance is usually an additional cost to project loans, country membership and ratification of such membership may have the likely effect of reducing the average cost of debt financing for projects, therefore improving the bankability of projects in member countries.
- Increased Investment Allocation to Member Countries
Member countries of the Corporation benefit from a significant amount of investment origination and advisory services. We focus strongly on developing an understanding of the National Developmental Agenda of the Governments of member countries. Our advisory and project development teams work closely with public and private sector partners to develop project financing opportunities across our focus sectors.In addition, the Preferred Creditor Status accorded to AFC by member countries, provides an immense incentive for AFC to invest in the country. AFC has the ability to catalyze funding on the back of (i) its international status in countries and (ii) strong relationships with credible international and regional partners. The Corporation is able to syndicate financing for projects in member countries, raising almost 4-6 times its own commitment, in most cases.
- Access to Public Sector Advisory & Project Development Facilities
Member Countries have preferred access to AFC’s (i) a US$5MM Public Sector Advisory Facility, and (ii) Project Development Facility, all designed to advancing projects to bankable stages and increase the number of projects attaining financial close in Africa.
AFC has established a Public Sector Advisory Facility wherein about US$5MM of its balance sheet has been committed to assisting Public Sector Institutions in member countries to advance projects which are at ideation stages. The envisaged ticket size per transaction / concept will range between US$200,000 to US$250,000 and the funds from the facility will primarily be used to provide liquidity for (i) Initial business plan and preliminary feasibility studies, (ii) Early environmental scoping and impact assessment studies, (iii) Preliminary financial modelling (iv) Project development schedules/activities and (v) Regulatory framework scoping.
AFC launched its Project Development (PD) Facility in 2012. The purpose of the PD facility is to provide early-stage investments in infrastructure projects in Sub-Saharan Africa. The purpose and objective of the facility is to (i) Increase the pipeline of bankable projects on the continent; (ii) Support projects across a wider range of agreed sectors (e.g., Power, Transport Infrastructure, Natural Resources, Heavy Industries and Telecommunications). AFC’s commitment is on an average up to US$15MM.
Africa Finance Corporation
3a Osborne Road, Ikoyi, Lagos
Phone: +234 1 279 1208
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