AFD - 2019 Universal registration document

A WORD FROM THE CEO

A word from the CEO

and with unfailing attention to issues of governance, which represent over €1 Ǿ billion, two-thirds of which are in Africa; (iv) to support non-sovereign entities (54% of volume), with a 40% increase in “civil society” financing, taking a joint construction approach that has been especially helpful in at- risk countries; and (v) to continue the automatic switch to partnership with a network of European organisations through the Alliance Sahel and the International Development Finance Club (IDFC), which once again showed its confidence in AFD by having it chair the organisation, as it has since 2017, for the second time in a row. This collective success results from the AFD’s ability to “act like a group” by getting ready to integrate Expertise France as of 1 January 2021 and create a powerful, internally consistent “French product” in the area of Ǿ development. This transformation of AFD into a platform group took the form, in 2019, of broadening Proparco’s scope of activity to now manage all of AFD’s private sector business (with the exception of that in the French Overseas Departments and Collectivities). This transfer of activities boosted Proparco’s approvals up to €2.5 Ǿ billion in 2019. Africa remains at the heart of Proparco’s geographic mandate, representing 51% of its approvals. The “private sector” subsidiary thus contributes to the Group’s “Whole of Africa” priority, whereby over half of all funds granted are to our African partners. In particular, 85% of the State’s financial effort is concentrated in Africa and the Near East. Project grants reached a record €960 million and were concentrated in the

19 Ǿ priority poor countries, mostly African and, primarily in healthcare, education and food security. The trend is based on a robust financial model, as demonstrated by AFD’s borrowing capacity on the markets. In 2019, AFD raised €6.4 billion in new bonds from a diverse investor base, in a mixed strategy of public issues (the majority) and private placements. Moreover, 2019 was a year in which AFD Ǿ issues reached an unprecedented size: one for €2 billion and one for $2 Ǿ billion. The Agency also benefited from €240 million of refinancing on preferential terms from the State. In conclusion, the soundness of AFD’s financial model together with strong support from the French State, the extraordinary effort made by its teams and the Group’s strategic choices— particularly towards helping Africa—have enabled AFD to carry its weight in building the response to the coronavirus health crisis, as well as its collateral effects in social and economic terms, especially across the African continent. This is central to our announcement of the €1.2 billion “Health in Common” initiative to provide an immediate response to short-term health challenges and prepare for the after-crisis by supporting not just States but also civil society organisations, public development banks, the private sector and French global health organisations working in the 19 priority countries for French aid in Africa, in the ocean basins (Madagascar/Comoros Islands and Haiti) as well as in the Near East.

In keeping with the wish of the President of France to give a “new sense of ambition” to the country’s development policy, AFD maintained its growth trajectory in 2019 and reached critical size. For the first time, the Group’s commitment approvals exceeded the €14 billion Ǿ threshold at exactly €14.1 Ǿ billion, versus €11.4 billion in 2018, an increase of nearly 20%. Over 2,500 Ǿ employees contributed to this sharp increase by making use of every AFD type of instrument—loans, subsidies, guarantees and equity investments—to finance 1,072 Ǿ projects. The AFD Group was able to meet this quantitative challenge while observing the priorities set in the 2018-2022 strategic orientations plan and adhering to its five quantitative commitments: (i) to combat climate change (51% of approvals), with an increased effort to promote adaptation; (ii) to increase social link, notably by reducing inequalities between men and women (46% of grants); (iii) to reduce vulnerability in conflict zones by implementing a strategy of “Diplomacy, Defence and Development,” notably through to the Minka Fund

Rémy Rioux Chief Executive Officer

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UNIVERSAL REGISTRATION DOCUMENT 2019

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