The African Development Bank (AfDB) approved a €400M ‘Lusophone Compact Guarantee Program’ for the African Portuguese-speaking countries, with the purpose of boosting the economy through the development of the private sector.
In recent years, the African Development Bank (AfDB) has been an important encourager of the economies of African countries. The AfDB aims to support the economic development and social progress, giving a contribution in the fight for the poverty reduction in the region.
For the pursuing of these goals, the Bank mobilizes and allocates resources for investment in the region and provides policy advice and technical assistance to support development efforts.
This program offers a boost to business development initiatives for bank’s non-sovereign portfolio in Angola, Mozambique, Guinea Bissau, Cape Verde, Equatorial Guinea and São Tomé and Principe between 2021 and 2025.
The guarantor of the program will be the Portuguese Government, being the €400M being already foreseen in the State Budget for 2020. The amount will be for the exclusive use of the Bank and allows individual projects to be covered until the total project maturity, which can be up to 15 years, and up to a maximum of 85% of the total loan amount, according to predetermined eligibility criteria.
The special importance of this program has been underlined by several sectors and officials, being an important way to contribute to the re-establishment of the economies after the COVID-19 pandemic, granting means for the wealth creation within the private sector, increasing the employment rate and diminishing poverty and precarious situations.
Article by Duarte Marques da Cruz
Duarte Marques da Cruz is partner of the Portuguese law firm MC&A, specialized in international business advisory, with a special focus in Lusophone markets. With extensive experience in the Energy sector (Renewables and Oil & Gas) and in International Taxation, he has supported international companies in major upstream, midstream transactions and projects, including in implementing, exploration and development programs. Duarte has also supported international clients in other areas of practice, namely, Mining, Transport & Logistics, Regulatory Compliance and Mergers & Acquisitions in Mozambique, Angola and Portugal.