THE African Union (AU) Summit of Heads of State and Government, in conjunction with the AfCFTA Council of Ministers responsible for Trade, has officially authorised the establishment of the AfCFTA Adjustment Fund Corporation, a critical initiative aimed at facilitating the implementation of the African Continental Free Trade Agreement (AfCFTA). The headquarters of this groundbreaking fund will be located in Rwanda, heralding a significant step towards fostering economic growth and trade integration across the continent.
The AfCFTA Adjustment Fund Corporation is tasked with providing essential support to countries and private entities navigating the transition to the new trading regime ushered in by the AfCFTA. This support encompasses financial assistance, technical expertise, grants, and compensation funding. The primary objective is to mitigate any negative impacts that may arise during this transition period, ensuring that no nation is left behind and that the benefits of the AfCFTA are shared equitably and sustainably.
Today marked the inaugural board meeting of the AfCFTA Adjustment Fund Corporation, held in Kigali. During this pivotal meeting, board members engaged in deliberations tha
t will lay the foundation for the successful operationalisation of the fund. One of the key decisions made was the appointment of the Fun
d for Export Development in Africa (FEDA), the impact investment platform of the African Export-Import Bank, as the Fund Manager for the Adjustment Fund.
The AfCFTA Adjustment Fund comprises three distinct sub-funds: the Base Fund, the General Fund, and the Credit Fund. The Base Fund will leverage contributions from AfCFTA State Parties, grants, and technical assistance to address tariff revenue losses that may result from the AfCFTA Agreement’s implementation. The General Fund will focus on financing the development of trade-enabling infrastructure, while the Credit Fund will mobilise commercial funding to support both the public and private sectors, helping them adapt to and capitalise on the opportunities created by the AfCFTA.
Jean-Louis Ekra, Chairman of the Board of the AfCFTA Adjustment Fund Corporation, emphasised, ‘It is important to note that the Adjustment Fund is not intended to perpetuate dependency; rather, it is designed to foster self-reliance. Its resources are aimed at assisting countries in overcoming temporary hurdles and building the foundations for long-term economic resilience.’
Wamkele Mene, Secretary-General of the AfCFTA Secretariat, remarked, ‘This inaugural meeting of the Board of the AfCFTA Adjustment Fund heralds a commendable milestone in the successful implementation of the Agreement. In collaboration with our strategic partner Afreximbank, we are committed to providing the necessary support to State Parties and private entities through the Adjustment Fund.’
George Elombi, Executive Vice President, Governance, Corporate, and Legal Services of Afreximbank, expressed his satisfaction, stating, ‘Given the enormous potential the AfCFTA holds for the continent, the Bank is exceptionally pleased to be a strategic partner to the AfCFTA Secretariat in establishing the Adjustment Fund.’
Marlene Ngoyi, Chief Executive Officer of the Fund for Export Development in Africa, expressed her honour and commitment, saying, ‘FEDA is honored to have the opportunity to play a role in unlocking the vast potential of the African Continental Free Trade Area (AfCFTA) agreement.’
The establishment of the AfCFTA Adjustment Fund Corporation marks a significant step forward in realising the transformative potential of the AfCFTA, driving prosperity, equity, and sustainability for millions of Africans across the continent.
