The African Development Bank (AfDB) has sold its first “Industrialize Africa” theme Bond to Fukoku Mutual Life Insurance Company, the sole investor in the transaction, for AUD 50 million.
Africa is at the bottom of the global value chain because African economies rely on raw commodities. Its share of global manufacturing exports amounts to less than 1 percent.
In 2015, the AfDB developed a new strategic operational agenda, the “High 5s”, aimed at as accelerating the implementation of the Bank’s Ten-Year Strategy (2013-2022). The High 5s are: “Light up and power Africa”, “Feed Africa”, “Industrialize Africa”, “Integrate Africa”, and “Improve the quality of life for the people of Africa”.
“Industrialize Africa” is one of the five operational priorities, through which the Bank aims to support private sector development and unlock the potential of Small-to-Medium Enterprises (SMEs).
The AfDB will use its best efforts to direct an amount equal to the net proceeds of the issue of the Notes to lending projects within the strategic priority area “Industrialize Africa”, subject to and in accordance with the AfDB’s lending standards. The proceeds of the Notes will be included in the ordinary capital resources of the AfDB and will be used for the general operations of the Issuer in accordance with the Agreement Establishing the African Development Bank.
Fukoku Life believes the Bond could offer attractive returns on their policy-holders’ funds while achieving a positive social impact in African countries.
The Bond was offered to Fukoku Life in a private placement format with Daiwa Securities Co. Ltd.as the sole arranger of the transaction.