AAMFI welcomes AU Ministers’ Decisions on African Multilateral Financial Institutions’ Preferred Creditor Status

Accra, Ghana 01 August 2024,The Alliance of African Multilateral Financial Institutions (AAMFI) held the third meeting of its Governing Council on the margins of the African Union Mid-Year Coordination Meeting, held in Accra, Ghana, during which it welcomed the endorsement of the Alliance by the African Union (AU) Ministers of Finance and Central Bank Governors at their 7th Ordinary Session of the African Union Specialized Technical Committee (STC) on Finance, Monetary Affairs, Economic Planning, and Integration, in Tunis, Tunisia.

The STC Ministerial declaration and decisions reflected the pivotal role of African Multilateral Financial Institutions (AMFIs) in the continent's financial architecture. AAMFI received strong support from the meeting and was recognized by the Specialized Technical Committee as crucial for strengthening the continental financial framework and advancing the African Union's Agenda 2063. The Ministers and Central Bank Governors reaffirmed the vital role of African Multilateral Financial Institutions in continental development and committed to enhancing the capital and credit ratings of AMFIs to mobilize essential funding for Africa's growth.

The Ministers and Central Bank Governors expressed concerns over recent reports questioning the Preferred Creditor Status (PCS) of AMFIs, emphasizing its importance in engaging with Credit Rating Agencies and securing development financing. The Ministerial declaration affirms the importance of the rights conferred on AMFIs by African Governments, including Preferred Creditor Status (PCS), crucial for reducing borrowing costs and deepening capital markets. The Ministers and Central Bank Governors urged AU Member States to uphold their commitments to AMFIs and respect their treaty obligations, and further recommended that the AU Assembly mandate the African Union Commission (AUC) to work with AAMFI in engaging key stakeholders, including the G20. The Ministers reaffirmed their commitment to swiftly establish the African Union Financial Institutions, including the African Monetary Institute (AMI) and the African Financial Stability Mechanism (AFSM).

The AAMFI Governing Council noted that the Alliance exemplifies Africa's innovative approach to address financing gaps and ensure sustainable development. The AMFIs, established by African States under treaty, have proven to be responsive to Member States in times of crisis, are commercially sustainable, generating profits and investment returns for shareholders while fulfilling their important development mandates.

The African Union's rejection of recent attempts to weaken the preferred creditor status of African-owned and controlled multilateral financial institutions, and the AU's commitment to strengthen AMFIs underscores these institutions' pivotal role in Africa's financial architecture. This ensures that AMFIs can continue supporting African sovereigns' development and drive economic growth.

AAMFI remains dedicated to collaborating closely with AU Member States, the AU and other stakeholders to implement these critical decisions, advancing the objectives of Agenda 2063. The AAMFI members will remain engaged and proactive in supporting these decisions, ensuring their collective efforts align with the AU's vision for a robust and sustainable financial architecture in Africa.

-ENDS-

About AAMFI:

The Alliance of African Multilateral Financial Institutions (AAMFI) is an alliance of African-owned and controlled African Multilateral Financial Institutions (AMFIs), which was established to advance the interests of their African member states in global finance and to advocate for AMFI's role in protecting and promoting them. AAMFI's mandate is to promote collaboration, cooperation, and coordination among its members in finding solutions aimed at promoting as well as supporting Africa's sustainable economic development and integration objectives, in line with member institutions' respective mandates and in furtherance of their development objectives. AAMFI's founding members include Africa Finance Corporation (AFC); African Export-Import Bank (Afreximbank); Trade and Development Bank Group (TDB Group); African Reinsurance Corporation (Africa Re); African Trade and Investment Development Insurance (ATIDI), Shelter Afrique Development Bank (SHAFDB); and ZEP-RE (PTA Reinsurance Company). East African Development Bank (EADB), and the African Solidarity Fund (ASF) are the Alliance's latest addition to the membership.

The Alliance was launched in collaboration with the African Union Commission by African Heads of State, on the margins of the 37th Ordinary Session of the Assembly of the Heads of State and Government of the African Union on the 17th of February 2024 in Addis Ababa, Ethiopia.

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