CHINA> AfDB Annual Meetings
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CHINA> AfDB Annual Meetings
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Development finance plays multi faceted role in economy
By Zhang Lu (China Daily)
Updated: 2007-05-16 07:05
"Development finance, broadly defined, extends far beyond the realms of finance alone," said Mandla Gantsho, vice-president of AfDB. "Development finance institutions need to play the triple role of catalytic financier, knowledge broker and development partner," he noted at the seminar. Citing infrastructure as an example, Gantsho said that the sector in Africa is estimated to need $20 billion in investments every year over the next decade. It is beyond the ability of any single institution to meet this requirement or make a meaningful difference. This underlines the need for development finance institutions to play a more effective role as catalysts to gather resources from both the public and private sectors, as well as to build partnerships among themselves and with the public and private sectors to mobilize more resources. Gantsho said that China Development Bank (CDB), in spite of its relatively short history, serves as a good example of how these roles can be successfully combined to create a powerful developmental force. African development finance institutions and CDB could learn from each other, he added. African and Asian institutions can partner each other in areas such as knowledge and staff exchange, development of new products and financing mechanisms, and co-sponsorship and co-financing of projects, Gantsho said. Amid the trend of economic globalization, CDB has been actively seeking international cooperation and providing financing services to overseas markets, the bank's vice-president Gao Jian told the seminar. His bank attaches great significance to its dealings with Africa, said Gao. It has already sent eight working groups to the continent, and plans to send 18 more this year. By the end of March this year, CDB's outstanding loans in Africa amounted to $1 billion. It has also been exploring ways to support 30 projects worth $3 billion in African countries. During the Beijing Summit of Forum on China-African Cooperation last November, CDB signed five agreements and memoranda with African partners, laying a solid foundation for further financial cooperation, Gao said. The Chinese government has recently approved the establishment of the China-Africa Development Fund, he added. According to CDB, a major initiator, the fund will start from $1 billion, and then add up to $3 billion in the second phase, eventually amounting to $5 billion. "The Chinese government will work with African countries to speed up the implementation of eight measures, to help African countries reduce poverty and pursue all-around economic and social development," said Deputy Commerce Minister Wei Jianguo. Wei said Sino-African trade and economic cooperation has developed rapidly in recent years and has become a major force in driving Africa's economic growth. China's investments in Africa at the end of 2006 stood at more than $11 billion, with the focus on agricultural development, processing and manufacturing, transportation, telecommunications, water conservancy, power and other infrastructure sectors. "It is estimated that Sino-African trade contributes to around 20 percent of Africa's economic growth," he said.
(China Daily 05/16/2007 page25) |
SHANGHAI: Development finance plays an important role in the sustainable growth of developing countries and such finance institutions in Asia and Africa should cooperate closely, officials said at a seminar held before the annual meetings of the AfDB in Shanghai yesterday.
