AfDB and Zambia Urge Shift from Aid to Investment at ADF-17 Meeting

With Africa confronting a widening $650 billion annual financing gap, leaders at the 17th replenishment meeting of the African Development Fund (ADF-17) in Lusaka, Zambia, have called for a fundamental rethink of how development is financed. Their message was resolute: Africa needs investment, not aid.

The meeting—hosted jointly by the African Development Bank Group (AfDB) and the Government of Zambia—brought together donor countries, recipient governments, and international development partners to chart a new course for financing Africa’s growth for the 2026–2028 cycle.

Speaking at the opening, Dr. Sidi Ould Tah, President of the African Development Bank Group, urged donors to see their contributions as strategic investments with measurable returns, not handouts.

“This replenishment is not about aid. It is about investment with measurable returns,” Dr. Ould Tah emphasized. “Every donor dollar should unlock $2.50 in additional capital, leveraging private financing and co-investment opportunities to build resilience and prosperity across Africa.”

The African Development Fund: A Lifeline for the Continent’s Poorest Nations

The African Development Fund (ADF)—the concessional arm of the AfDB—provides grants and low-interest loans to 37 of Africa’s most vulnerable nations, 21 of which are already in or at high risk of debt distress.

For over five decades, the Fund has been a vital engine of inclusive growth, supporting investments in infrastructure, agriculture, energy access, and human capital across the continent.

Zambia’s Acting Minister of Finance, Charles Lubasi Milupi, hailed the ADF’s impact on the ground:

“Behind every figure, every project, and every policy are real people and communities whose lives are being improved through our shared commitment to sustainable development,” Milupi said. “The African Development Fund remains a beacon of hope and solidarity.”

He cited Zambia’s recent progress in energy access, agricultural value chains, and road infrastructure as examples of how ADF-supported projects are helping nations recover from crises and advance toward self-reliance.

Africa’s $1.3 Trillion Development Challenge

Dr. Ould Tah laid bare the scale of Africa’s financing needs. To achieve the Sustainable Development Goals (SDGs), the continent must mobilize $1.3 trillion by 2030—an almost insurmountable challenge given current financial flows.

The continent faces an annual external financing gap of $650 billion, compounded by the effects of climate change, conflict, and limited access to private capital.

“The urgency is both demographic and financial,” Dr. Ould Tah warned. “By 2030, half of the people joining the global labor force will be African—equivalent to 15 million new workers each year. We cannot afford to leave them behind.”

The AfDB President called for bold and coordinated action to mobilize blended financing, strengthen public-private partnerships, and modernize Africa’s financial systems to attract sustainable capital.

“Four Cardinal Points” for Africa’s Financial Transformation

In his first address to ADF deputies since assuming office in September, Dr. Ould Tah outlined his “Four Cardinal Points” for guiding the Bank’s next phase of development strategy:

1. Mobilizing additional financial resources through innovation and leverage.

2. Enhancing efficiency and accountability within AfDB operations.

3. Accelerating regional integration through transformative infrastructure.

4. Investing in people, particularly Africa’s youth, women, and vulnerable communities.

He emphasized that the upcoming ADF-17 cycle will focus on climate resilience, food security, energy transition, and debt sustainability, ensuring that financing directly contributes to measurable social and economic outcomes.

Pushing for Reform: Expanding ADF’s Borrowing Capacity

A key agenda item in Lusaka was the proposed amendment to the ADF charter to allow an 85% market borrowing threshold. Currently, the Fund cannot borrow from non-concessional sources—a restriction that limits its capacity to scale operations and respond to emergencies.

“Without this reform, our capacity to serve will be fundamentally limited,” Dr. Ould Tah stated.

He urged all ADF member states to ratify the amendment before 31 December 2025, noting that expanded borrowing powers would enable the Fund to leverage private capital and diversify financing instruments.

The Bank is already developing a suite of integrated financial tools—including guarantees, blended finance, local currency lending, and project preparation support—to de-risk fragile markets and create tangible opportunities for private investment.

Building Partnerships for a New Era of Development

Dr. Ould Tah also announced that the AfDB Group will convene a strategic dialogue in December with export credit agencies and development finance institutions. The goal is to forge new partnerships and mobilize private sector resources for the continent’s most fragile states.

This approach aligns with the AfDB’s long-standing philosophy of “financing for impact”—where every dollar mobilized multiplies through partnerships, innovation, and targeted delivery mechanisms.

“Together, we can deliver a robust and forward-looking ADF-17—one that stretches each of our capacities, builds resilience across Africa, and generates clear, measurable returns for every contributor,” Ould Tah said.

Leveraging Climate Finance and Complementary Mechanisms

Minister Milupi called on the international community to complement ADF funding with other financing windows, particularly in the climate finance space.

“We collectively urge that we leverage other financing mechanisms, especially those dedicated to climate action, to amplify the resources of the African Development Fund,” Milupi stated.

He emphasized that African-led solutions—supported by blended finance and results-based investments—will be key to ensuring that development efforts are resilient, inclusive, and sustainable.

A Turning Point for Africa’s Future

The three-day ADF-17 technical meeting in Lusaka is expected to continue through 9 October 2025, with a pledging session scheduled for December 2025 in London.

Participants agree that the stakes are high: if the ADF can secure sufficient commitments and expand its borrowing authority, it could unlock billions in private and public investments across 37 low-income African nations.

As Dr. Ould Tah concluded, the challenge is not just to fund development but to transform how it is financed.

“This is Africa’s moment to redefine development finance—not as charity, but as shared investment in a sustainable future.”