Canada’s new $1.1 billion support to African Development Bank to increase lending to member countries

By The Inspirer

On the sidelines of the World Bank-IMF Spring meetings, Canada announced a $1.1 billion commitment in temporary callable capital to support the African Development Bank.

Callable capital is the part of a company’s capital from the sale of shares for which the company has not been paid, but for which it can demand payment.

Canada’s announcement, to be approved by the Bank’s governors, was made by Maryam Monsef, the Canadian Minister of International Development and for Women and Gender Equality.

“I am happy to say that today, Canada is demonstrating its commitment to African countries and our confidence in the African Development Bank by announcing that we are going to subscribe up to US$ 1.1 billion in temporary callable capital, if required,” Minister Monsef told members of the Diplomatic Corps based in Washington D.C., governors of the African Development Bank, executive directors, including executive director David Stevenson, who represents Canada, China, Korea, Turkey and Kuwait.

The Bank’s senior management team was also in attendance.

The announcement comes a day after a meeting of the Bank’s governors in Washington D.C. to continue discussions on a 7th General Capital Increase.

“The African Development Bank is a key partner for Canada and we are committed to supporting the Bank’s African member countries. Canada and Canadians are proud of our long history of partnership and collaboration with Africa,” Monsef noted, before reminding the 100 attendees that Canada was determined to ensure that “no less than 50% of bilateral development assistance is dedicated to sub-Saharan Africa by 2021-2022.”

Commenting on the announcement, the Bank’s President, Dr Akinwumi A. Adesina said “Canada’s commitment and support is a huge boost to the African Development Bank. It will allow the Bank to strengthen its Triple A rating and increase lending to member countries while discussions are ongoing among all shareholders for a general capital Increase.”

“Your announcement is a clear indication that Canada has strong confidence in the African Development Bank,” Adesina added, while extending the Bank’s appreciation to Prime Minister Justin Trudeau for Canada’s unwavering support.

Minister Monsef urged other AAA-rated member countries to join Canada in providing temporary callable capital to the Bank. “I sincerely hope that this announcement will facilitate the general capital Increase negotiations and help support your efforts. Canada stands with you.”

In a follow-up bilateral meeting, Minister Monsef and President Adesina discussed values and interests in common on gender and increasing access to finance for women, as well as on climate and renewable energy issues.

Canada has been a member of the African Development Bank since January 1983 and has participated in all general capital increases of the Bank. It provided temporary callable capital in 2010 while the GCI VI negotiations were ongoing.  That decision enabled the Bank to continue to provide its support to regional member countries in the aftermath of the international financial crisis.

As at 30 June 2018, Canada’s total capital subscribed amounted to $3.5 billion of which $252 million has been paid in and $3.22 billion stands as callable capital, making Canada the 4th largest shareholder among the Bank’s non-regional member countries.

 

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Elias Hakizimana

Elias Hakizimana, CEO&Founder of The Inspirer Ltd,(www.rwandainspirer.com) is a professional Rwandan Journalist with Bachelor’s Degree in Journalism and Communication, received from University of Rwanda’s College of Arts and Social Sciences (CASS) in 2014. He served various media houses in Rwanda including Rwanda Broadcasting Agency (RBA) in 2013 and became passionate with English Online and Print Media Publications where he exercised his talent as a Freelance News Reporter for The New Times, The Independent, The Rwanda Focus, Panorama and more before he became a Self-Entrepreneur as the CEO and Founder of The Inspirer Limited in early 2017.

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