The African Development Bank Group (AfDB) has announced the launch of its first Africa Circular Economy Facility during its 2022 Annual Meetings. The circular economy is a model of production and consumption that involves sharing, leasing, reusing, repairing, refurbishing and recycling existing materials and products as long as possible.
AfDB’s board of directors approved the facility on 30 March this year. As a trust fund, it will channel finance and de-risk innovative circular economy business models beyond waste management. It will support the country-led African Circular Economy Alliance (ACEA) in integrating the circular economy into African green growth strategies.
The multi-donor trust fund will operate over a five-year period. It will receive initial support of €4 million from the Government of Finland and the Nordic Development Fund.
“Finland is committed to supporting the African Circular Economy Alliance and the circular economy as a pathway to green growth. The key to success in designing a circular economy roadmap in Finland has been the involvement of a broad spectrum of stakeholders, such as ministries, local governments and the private sector. We hope that sharing our experience can help others to succeed in their circular transition,” said Juha Savolainen, Deputy Director General of the Ministry of Foreign Affairs of Finland.
The facility will focus on three strategic areas: institutional capacity building to strengthen the regulatory environment for circular economy innovations and practices; providing support to the private sector through a business development program; and providing technical assistance to the African Circular Economy Alliance.
The Facility is the African Development Bank’s first dedicated trust fund to support circular economy innovations and policy frameworks. It is unique in Africa. The highlight of the launch was an interactive discussion on the benefits of the circular economy and the new facility.
Aligning with AfDB’s green growth agenda
Vice President for Power, Energy, Climate Change and Green Growth at the African Development Bank, Dr. Kevin Kariuki commented saying; “circular economy principles align with the African Development Bank’s agenda to transition Africa towards green growth. It is indeed in line with the theme of this year’s Annual meetings—achieving climate resilience and a just energy transition for Africa.”
“The African Circular Economy Facility will increase the Bank’s portfolio of operations that align with the circular economy. This includes renewable energy, climate-smart agriculture and green manufacturing sectors. This will create new value-chains that generate new green jobs for the African youth,” concludes Dr. Kariuki.
Circular economy principles play a strategic role in advancing the African Development Bank’s High-5 development priorities. They will help African countries achieve their nationally determined contribution targets. These are the public pledges from countries on how they plan to play a part in post-2020 collective action on climate change. The principles will also advance countries’ progress towards the UN Sustainable Development Goals and contribute to Africa’s economic recovery.