AFD - Universal Registration Document 2020

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PRESENTATION OF AFD

Activities of the Agence Française de Développement Group in 2020

its funding for the preservation of global biodiversity, AFD is committed to increasing its biodiversity financing from €457M in 2019 to €1bn in 2025 (Biodiversity roadmap for 2019-2022). In 2020, the Latin America region became the leading region in biodiversity financing, followed by the Orients region. These two regions contribute nearly to two-thirds of AFD’s biodiversity financing. This is largely due to the mobilisation of sovereign loans by Asian and Latin American countries to finance their pro- nature policies. In terms of purposes, 20% of AFD’s biodiversity finance corresponds to projects dedicated to the conservation and protection of biodiversity (Biodiversity CAD2) and 80% of AFD’s biodiversity financing in 2020 concerns projects where biodiversity is an explicit secondary objective (CAD1), in other words to foster the transition to a pro-nature economy, thanks to an effort to “mainstream” biodiversity in a growing number of intervention sectors. In this category of projects, 2020 consolidated AFD’s historic commitment to the ecological transition of production methods and of the agricultural, forestry and fishing sectors. The latter sector saw its contribution to biodiversity increase sharply (from €8M in 2019 to €90M in 2020 due in particular to a major oceanographic research programme in Indonesia). Likewise, in terms of decontamination, AFD continues its efforts to promote sanitation and gradually strengthen its capacity to intervene in the waste treatment and recycling channels. The year in 2020 was also marked by an increase in projects aimed at greening cities, which limit the pressure of the artificialisation of land. AFD confirmed its support for the generalisation, in the countries where it operates, of robust policies to manage and offset the residual impacts of infrastructure and industrial projects on biodiversity. Lastly, the year 2020 confirmed its positioning as a funder of public policies favourable to biodiversity through the growth of public policy loans including an explicit biodiversity objective in their public policy reform matrix. Finally, the education sector fell from 7% to 3% between 2019 and 2020, partly as a result of a lower number of 209 grant resources made available to AFD. Most of the commitments for 2020 concern Africa (90% of funding and 95% of the volume of commitments contribute to the reduction of gender inequalities). The year 2020 was marked by the impacts of the Covid crisis on the entire educational continuum. AFD responded by: (i) Ǿ working closely with international, national and local partners to plan and implement a response and to support the production of knowledge to maximise the impact of the measures taken ( e.g. support for Ǿ IIEP-Dakar-UNESCO); (ii) Ǿ the reorientation of the current instructions to include short- and medium-term responses ( e.g. Formapro-Madagascar, to ensure the continuity of lessons; Ethiopia - Budgetary financing for the defence of employment and support for SMEs and decent work by reallocating a €70M loan); (iii) Ǿ the reorientation of the portfolio of projects under implementation ( e.g. Senegal: €2M for the PADES project - Support programme for the development of education in Senegal, in support of the response plan; ACE-Partner: Regional support for the scientific response in West Africa; Tunisia: €9M for the PAFIP project - Training and professional integration programme); (iv) Ǿ management of SME delegations: AFD supported the governments of Niger, Burkina Faso and Senegal in submitting three funding requests to the SME to support the implementation of the emergency response to Covid-19 and support education systems so they are more resilient to crises.

In particular, it is worth highlighting the granting of a public policy loan (PrPP) of €100M to Indonesia, as well as a sectoral innovation facility for NGOs (FISONG) of €2.5M on the subject of citizen participation. In 2020, the water and sanitation sector continued to make a significant contribution to the fight against climate change: 100% of projects have climate co-benefits. These projects will make it possible to better understand water resources, to preserve water in terms of quantity and quality, to reduce the health vulnerability of populations and to promote circular economy approaches. The share of financing devoted to sanitation also increased. For example, AFD approved a loan of €64M for Cuba to improve the sanitation system for 500,000 inhabitants of Havana, as well as a grant of €8M to complete a project to develop this service in Djibouti. Lastly, since access to safe drinking water and good hygiene practices enable the implementation of the main barrier measures against infectious diseases, in 2020 AFD developed a specific water and sanitation activity in response to the Covid-19 pandemic. As part of the “Health in Common” initiative, for example, it awarded a grant of €1M to the slums of Nairobi in Kenya. It also provided emergency support through the financing of (i) Ǿ budget support to financially support water and sanitation operators, (ii) Ǿ webinars on crisis management mobilising French expertise, (iii) Ǿ emergency work and protective equipment and (iv) Ǿ public awareness measures. The governance sector, for its part, in 2020 represented 7% of the commitments for the year, i.e. €0.6bn. The context of the year in 2020 did not allow all the activities planned at the beginning of the year to be rolled out. This particular year was focused on maintaining dialogue with the beneficiaries of our projects. AFD’s intervention thus contributed i) to paying particular attention to governance issues in countries in fragile situations, with specific activities undertaken in the Middle East, in the Lake Chad region and in Central Africa, ii) to supporting the transformation of our partners (better alignment between organisation and choice of trajectory. This involves, for example: (i) Ǿ meeting the needs of its partners by opening a space for technical dialogue on their strategy, internal operations and overall performance, without being confined to underlying needs associated with the appraisal of a specific sectoral project, (ii) Ǿ assisting them in identifying favourable conditions for change, supporting them to create these conditions and formalising a development trajectory based on specific targeted transformations (HR, Digital, Strategy/Foresight); and (iii) Ǿ to considering the operationalisation of this change-management strategy. Commitments in the agriculture and food safety sector decreased. They amounted to €0.29bn in 2020 compared to €0.49bn in 2019, or 3% of AFD’s activity. However, and despite a year marked by the emergence of the health crisis and its significant impact on food systems, particularly in West Africa, projects aimed at an integrated response to food security issues were funded, for example, in Burkina Faso and in Niger. The regional storage system for ECOWAS cereals was also strengthened. Major irrigation development projects (in Haiti, Ghana, Gambia and Mauritania) are also helping to strengthen food security by better covering basic needs. The activity remained, however, at a very high level in terms of numbers of projects, notably in grants. In terms of climate and the environment and natural resources, commitments remained stable between 2020 and 2019, standing at €0.79bn. In line with France’s commitments to double

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2020 UNIVERSAL REGISTRATION DOCUMENT