In the 5th phase of the Expanded Private Sector Assistance to Africa (EPSA) initiative, which runs from 2023 to 2025, the Japanese government and the African Development Bank (AfDB) agreed to share $5 billion in funds. It was made known at the 8th Tokyo International Conference on African Development (TICAD8) held on August 28, 2022, in Tunis, the Tunisian capital.
The money comes from the existing window, which gives $4 billion, and the new Special Window, which gives up to $1 billion. Japan will establish this unique window to support countries that are making progress in improving transparency and debt sustainability as well as other reforms, ensuring a stable and significant improvement in the debt situation.
Due to how important food security is, Japan and the African Development Bank have decided to put agriculture and nutrition at the top of EPSA 5. So, EPSA 5 will focus on important issues in Africa like electricity, communication, health, agriculture, food security, and nutrition.
At the opening event for EPSA 5, Mr. Masato Kanda, Japan’s Vice Minister of Finance for International Affairs, reaffirmed Japan’s commitment to helping African nations while respecting their ideas.
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Dr Akihiko Tanaka, president of the Japan International Cooperation Agency (JICA), “In the face of a serious situation caused by multiple crises, building resilience and promoting people’s security are critical components of Japan’s support for Africa.” When it comes to solving the continent’s social and economic problems, our collaboration with the African Development Bank is crucial, and EPSA is a vital component of that. With EPSA’s support, we can build a better future, and that’s a promise from JICA.
“EPSA 5 is the collaboration that Africa and the world need,” said Dr Akinwumi Adesina, president of the African Development Bank Group. We need to do significantly more to organize the private sector and generate employment in Africa amid escalating climate change, the COVID-19 epidemic, and the conflict in Ukraine. Millions of people in Africa will benefit from the newly signed initiative.
To help with issues like food security, climate change, healthcare, digitization, and debt management throughout Africa, the African Development Bank Group advocates development objectives that align with the Japanese government.
Japan-Africa economic cooperation
The Japanese government launched EPSA at the G8 summit in Gleneagles in 2005. Japan transitioned from EPSA to TICAD following TICAD 6 in 2016. With the inauguration of EPSA4 at TICAD7 in 2019, Japan is continuing its financial contribution (US$3.5 billion for 2020–2022).
Japan announced the launch of EPSA at the G8 summit in Gleneagles in 2005. After TICAD 6 in 2016, Japan upgraded EPSA to TICAD. Japan is currently providing its support through EPSA4 (US$3.5 billion for 2020–2022), which was launched at TICAD7 in 2019.
The African Development Bank Group played a pivotal role in the eighth Tokyo International Conference on African Development (TICAD) held in Tunis, the capital of Tunisia, as Japan, a long-standing development partner of Africa, this year continues to support the continent’s economic growth.
Dr. Adesina discussed with the senior Japanese government officials, African leaders, and business participants partnership opportunities to increase support for Africa’s transformation as the continent builds back better from the COVID-19 pandemic.
It is anticipated that Japan will provide more assistance to help boost the development of communication infrastructure on the continent as well as to assist with addressing food security concerns. Through its partnership with Japan, the African Development Bank Group is working to bring strong, long-term prosperity to all of Africa.
The Japanese government has a unique partnership with the African Development Bank Group. Regarding financial support, Japan is the most significant contributor to the institution. It recently took part in the 7th General Capital Increase of the African Development Bank and the Bank Group’s 15th replenishment of the African Development Fund, which provides concessional loans.
Read also: AFDB Approves Establishment of African Pharmaceutical Technology Foundation
Japan’s contribution to the Africa EPSA
The program to help the private sector in Africa was run by Japan and the African Development Bank. This partnership is the most important and longest one of this kind between a member of the African Development Bank Group and a member country. This help comes in the form of accelerated co-financing, non-sovereign loans, the African Private Sector Assistance Fund, and the Private Sector Investment Finance scheme. The African Development Bank’s plan to improve the growth of the private sector depends on these four pillars.
Since 2007, three waves of the Enhanced Private Sector Assistance for Africa program have worked well. The African Development Bank Group and Japan, through the Japan International Cooperation Agency, put more than $5.2 billion into sovereign and non-sovereign projects. A total of $86.9 million has been invested in providing technical aid and strengthening institutional capacities.