AFD - 2019 Universal registration document

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PRESENTATION OF AFD

Activities of the Agence Française de Développement Group in 2019

The private sector activity was up in 2019, with commitments reaching €163.4M compared to €133M the previous year. Loans to the public sector were €712M (compared to €688M in 2018), up slightly after the marked decrease recorded in 2018. This regain in activity is mainly due to the continued increase in subsidised loans to local authorities, +68% over one year. Other loans to the public sector (non-subsidised and short term) continued to decline, marking the focusing of AFD’s financing on priority sectors of the Trajectory 5.0 Outre-mer. Despite a difficult economic situation for a number of public sector players, in particular for certain local authorities whose borrowing capacity - and therefore investments - fell significantly (particularly in the Antilles), commitment volumes in this sector were €712M. Subsidised loans continued to grow at €544M, of which €118M was granted to the equivalent Pacific Green Fund (PSP Vert - environmental projects and the fight against climate change) and €544M to the PSP-Bonifié (social sectors and essential services). This increase in subsidised activity illustrates the efforts to deploy the Trajectory 5.0 Outre-mer, which supports the Agency’s activity. It also reflects the impact of external factors, such as the relaunch of European operational programmes in regions where programming could not be implemented up to now, and more traditionally, a securing of major investment operations encouraged by the approach of local electoral cycles. Consequently, this allowed reinforced support for projects related to the five priorities of the Trajectory 5.0 Outre-mer, and particularly for the environment and the medical-social sector. For the private sector, loans to companies amounted to €163.4M, showing a significant recovery in activity compared to 2018 (€133M), but which must be weighed against the large refinancing operation for the Socredo subsidiary (€117M). This operation, however, enables SME/VSEs in French Polynesia to be fed as Socredo is the leading financial institutionwith 44%market share. The direct loans to private companies activity decreased significantly with commitments of €46M compared to €83M the previous year. This is due to the particularly competitive nature of the financial environment and internal arbitration on several files in which the risk profiles were unsatisfactory. We can note, however, that grants to the private sector in 2019 concerned all ocean basins. 1.6.6 Intellectual production 1.6.6.1 Research, training and publication activities In April Ǿ 2019, AFD’s Board of Directors adopted the research, innovation and knowledge strategy for the 2019-2022 period. This introduces two major changes in studies and research (E&R): (i) Ǿ multiply collaboration with locally-anchored research partners in the AFD Group’s intervention regions, (ii) Ǿ focus the research agenda on the French policy priorities by highlighting several key themes: climate/biodiversity, inequalities and social link, growth.

AFD’s research on the Climate/biodiversity theme focuses on an analysis of the interactions between economic development/ prosperity on the one hand, and the environment on the other, with the introduction of tools for the measurement and the quantification of these interactions. The work on climatic financial risks will be developed further in 2020. With regard to adapting to climate change, the work focuses on small insular states and the development of weather and climate services with the aim of reducing the risk of natural disasters. A research and knowledge programme on biodiversity aims to promote the development of a pro-nature economy based on research findings. Lastly, AFD continues to develop macro-economic models, with the help of its GEMMES tool, with six models (Brazil, Côte d’Ivoire, Colombia, Vietnam, Tunisia and Morocco) most of which should be operational at the end of 2020. For cohesion/social ties and human development, work focuses on four main themes: inequalities, social protection - notably through integration into the labour market - training/employment match and demographic transition insisting on gender. This work falls within the prospect of fair transition, by studying the different aspects of sustainable structural change induced by development. The studies carried out propose recommendations on public policies. From 2017 to 2020, AFD has ensured the coordination and set-up of a facility for a research programme on inequalities in the form of a delegation of DG DEVCO funds. On the Governance, Common goods and Regions theme, AFD focuses its work on several themes: (i) Ǿ the sector deployment of the common goods approach (medicine, water, oceans and biodiversity, urban and rural land), (ii) Ǿ the analysis of their economic model and relationship with States, notably in a context of fragility, (iii) Ǿ the study of how public policies are made in Africa, (iv) Ǿ issues of security-development, notably in the Sahel. Grounded in a partnership process, all research programmes will promote the national research networks of our partner countries. With the signature of a memorandum of partnership with Côte d’Ivoire (2016) and Tunisia (2018), the approach of strategic dialogue was extended to Morocco and Mali in 2019, and with the UNECA. Priority is given to work on Africa. Granted in January Ǿ 2019, the “ Savoirs Sahel ” (Sahel knowledge) project has enabled financing for several research programmes entrusted to Sahel teams on key themes to understand the transformations and challenges in the Sahel in crisis and to contribute to steering the Agency’s portfolio: regional governance and local legitimacy, Arab-Islamic education, resilience of agro-pastoral systems to climate constraints, social integration of young people. These research programmes will deliver their first results in 2020. In January Ǿ 2020, AFD also launched a series on African economies, edited by Repères La Découverte, which should be published once a year.

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UNIVERSAL REGISTRATION DOCUMENT 2019

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