Franco-African Forum for Shared Growth
Paris, February 6, 2015
France is linked to Africa by history, friendship, the economy, and above all human ties. We have many French people living in Africa and many Africans living in France. That’s a major opportunity. But in addition to this cultural link, there’s a sort of convergence of shared interests. While we’re aware of it, while France is fully active, while it already has many businesses in the African markets, while you trust French businesses in terms of legal rules, we French, we the French authorities, must better support Africa in funding these projects.
Because the key is funding. That’s why I wanted, during this forum, to show we’ve adapted many of our tools to support the funding of French businesses that will go to invest in Africa, and the funding of projects of interest to Africa.
In our financial and administrative provision, there exists the Emerging Markets Reserve Fund. It’s now fully open to African countries. It’s already been used in the past to finance major projects: the high-speed train in Morocco, the Cairo Metro, a dam in the Nairobi region etc. But we now want to make all this funding available to the largest number of projects in Africa. 70% of the Emerging Markets Reserve, i.e. €240 million, will be spent in Africa.
The second tool is Coface [French export credit insurance agency]. Coface is necessary, essential, to ensure the funding of many projects in Africa. Macky Sall recalled this and Ali Bongo emphasized it: the main risk isn’t in Africa. There are risks that may exist everywhere, including in Europe. So we must look at Africa as we look at any country, any continent, with the same rules, but also ensuring that Coface can provide more guarantees. In 2013, those guarantees amounted to €800 million. In 2014, they rose to €2 billion, and they’ll continue to increase further in 2015.
We also decided to create an export bank in France to support the major international contracts. This will have a direct influence on what we can do in Africa. In fact, one of the blocks we may encounter to exporting isn’t related to the conditions of competitiveness – even though these may exist and lead us to take measures in France – and isn’t related to know-how, quality or technology, in which we have excellent businesses, large and small; one of the things which act as a brake on exporting is funding, because a lot of countries guarantee much more advantageous funding than France in order to promote their exports successfully.
So the Finance Minister and I have decided to set up an export bank by the end of March. This mechanism will involve every country and every economic sector, without restrictions. Whenever there’s a contract above a certain volume – €100 or €200 million – the bank will intervene directly. This will also enable us to reduce funding costs; we’ve estimated the savings we’ll make from this to be 10%. (…)
I’ve made two pledges.
The first was that the French Development Agency [AFD] would invest €20 billion over five years in Africa. This pledge will be honoured, strictly honoured, entirely honoured. It’s starting to be implemented. It will be all the easier to honour because I’ve decided to leave the French Development Agency 50% of its net result, to consolidate its own capital, so that when the machine has got going it can be constantly fuelled. We’ll also give the AFD the means to develop, expand and continue its action.
I made a second commitment, which Macky Sall hasn’t forgotten: €1 billion for the energy transition. That €1 billion is not only confirmed, it also adds to the €1 billion France has decided to contribute to the Green Climate Fund. That’s what I can announce here, once again.
We’re also working all the time on this funding issue, to guarantee not only loans or even donations but also the ability to encourage the capital funding of businesses, and particularly African businesses. The BPI [Public Investment Bank] and PROPARCO (a subsidiary of the French Development Agency) are going to launch what’s called Averroès Finance III this year, to the tune of €30 million, to provide capital funding for French SMEs and mid-caps in Africa, and also for African businesses. There will be this joint Franco-African fund, it will be a first and it will thus enable us to forge partnerships between businesses, and above all provide French companies investing in Africa with the means to guarantee their presence.
There’s also our desire to develop crowdfunding. This is also set out in new legislation. A challenge is being issued. I’ve mentioned the African diaspora in France, who are keen to contribute to the development of their countries of origin. So this crowdfunding could be guaranteed by the authorities and could raise capital, raise resources and enable them to be invested in Africa.
I’m aware, too, that an “Africa Club” will soon be created within the French Association of Investors for Growth. It will also be able to mobilize risk capital players, particularly French players, to fund projects in Africa.
But people still need to be able to move around. Here too, I remember one question put to me. I think it was in Senegal, when I was told: “you want to promote exchanges, you want to develop partnerships, but it’s difficult for African business leaders to go to France, for creative people to go to France, because visas aren’t issued in time or with the necessary ease”. So I asked the Foreign Minister and the Interior Minister to promote, facilitate these mechanisms. I’ve got the figures right in front of me today: 300,000 travel visas are issued every year to African investors, entrepreneurs and researchers. The figure is up 60% compared with 2012. It signals the confidence we have in Africa.
I might also add that France welcomes 110,000 African students. It does so out of solidarity, of course, but also because developing African talents is an investment for France and for Africa. These students are subsequently going to return to their country of origin and take on responsibilities. (…)
But I also want to say to young French people wanting to gain experience abroad, especially in Africa, that they will be able to do so more easily in the future. During my press conference yesterday, I talked about civic service. Civic service won’t just be broadened, made easier, beefed up; it will be adapted to take on an international dimension, as part of International Solidarity Volunteering. Young French people wanting to volunteer for work in Africa will be encouraged and their number increased, because I want French people who want to take part in this wonderful story, this wonderful adventure of the African continent’s development, to be able to do so in voluntary organizations, businesses, government departments, wherever they can be useful. (…)./.