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ARAB BANK FOR ECONOMICDEVELOPMENT IN AFRICA

Annual Report

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ARAB BANKFOR ECONOMIC DEVELOPMENTIN AFRICA

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Annual Report

PageBasic Information: Establishment – Definition - Financial Activities 4

• The Board of Governors 7• The Board of Directors 9• Letter of the Chairman of the Board of Directors 10

The Most Important Performance Indicators of BADEA (2015 - 2016) 11An Overview of International Economic Development 12Part One: Financial Activity 17

• BADEAs’ Total Commitments in 2016 17• Public Sector Loan Commitments and their Sectoral Distribution in 2016 17• Loan Commitments and their Sectoral Distribution (1975 – 2016) 22• Social Sector Projects 22• Private Sector 23• Financing of Arab Exports to African Countries 24• Regional Operations 24• Technical Assistance Operations and their Sectoral Distribution in 2016 25• Technical Assistance Operations and their Sectoral Distribution (1975 – 2016) 25• Evolution of Commitments and Disbursement from Loans and Grants (1975 – 2016) 28• Projects and Technical Assistance Operations Completed during 2016 31• Signature of Agreements 31• BADEA’s Contribution Towards Debt Relief 31• BADEA’s Financing and Poverty Reduction 32• Co-financing 32• Coordination with Development Financing Institutions 33• Cooperation with Arab and African Regional Organizations 34

Part Two: Detailed Description of the Approved Operations During 2016 37

• Public Sector Projects 37• Private Sector Projects and Foreign Trade Operations 53• Technical Assistance Operations 58

Part Three: Financial Resources 69• Financial Position 69• Revenus 69• Expenses 71• Net Income 71• Financial Commitments 71• Disbursement and Repayment 72• Conclusion 73

Financial Statements 75General Conclusion of the Report 101Annexes 103

Contents

Photos included in this Report are examples of operations (projects and technical assistance) that BADEA financed or co-financed.

Basic Information

DefinitionBADEA is an international financial independent institution owned by eighteen (18) Arab countries, members of the League of Arab States (LAS), who signed its Establishing Agreement on 18th of February 1974. BADEA enjoys full international legal status and autonomy in administrative and financial matters. It is governed by the provisions of its Establishing Agreement and the principles of international law.

BADEA aims at strengthening economic, financial and technical cooperation between Arab and African countries and the embodiment of Arab-African solidarity based on equality and friendship. To achieve these objectives, BADEA is mandated to execute the following functions: Contribute to the financing of economic

development of African countries. Encourage the participation of Arab

capital in African development. Contribute to the provision of the

necessary technical assistance for development in Africa.

Financial ActivityThe projects financed by BADEA are priorities of the beneficiary countries and usually form part of their development plans. In some cases, these projects are of a regional character, benefiting several countries at the same time and helping in their economic integration.BADEA’s contribution to the financing of any project can reach up to 60% of its total cost, provided that the loan amount, for the said project, does not exceed 20 million dollars*, while the contribution can reach up to 90% of the total cost of any project, in case this total cost does not exceed 15 million dollars. BADEA can grant more than one loan to a country in one year, provided that the total amount of such loans does not exceed 20 million dollars. BADEA also provides technical assistance in the form of non-refundable grants and finances operations of Arab exports to African Countries, eligible for its assistance. The Board of GovernorsThe Board of Governors is the highest authority of BADEA. It consists of a Governor and a deputy Governor from each member state. The Governors are usually the Ministers of Finance

EstablishmentThe Arab Bank for Economic Development in Africa (BADEA) was established pursuant to the resolution of the 6th Arab Summit Conference at Algiers in November 1973 and commenced its operations in March 1975. Its headquarters is in Khartoum, the capital of the Republic of the Sudan.

* In this Report Dollar means US Dollar ($)

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of the member states. The Board of Governors is entrusted with all the authorities of BADEA. It has the authority to delegate all or some of its powers to the Board of Directors, except those expressly stated in the Establishing Agreement including: increasing the capital, appointing the Director General of BADEA, approval of financial statments, allocation of the net income and interpretation and amendment of the Establishing Agreement. The Board holds one annual meeting in ordinary session. The Board of DirectorsThe Board of Directors is composed of eleven (11) members and enjoys all the necessary powers for managing BADEA, except those that are the prerogatives of the Board of Governors. The powers of the Board of Directors include:

Setting BADEA’s general policies and follow-up their implementation, in line with the Establishing Agreement and the directives of the Board of Governors,

Setting the rules and the regulations and taking the necessary measures for the management of BADEA, on the bases of economy in running expenses and operational efficiency,

Determining BADEA’s program of operations and approval of loans and grants offered by BADEA,

Making decisions concerning borrowing and issuing of bonds,

Preparing for the meetings of the Board of Governors,

Establishing agencies, branches and offices for BADEA as may be necessitated operationally.

The nine largest contributors in BADEA’s capital are permanent members of the Board of Directors; countries fulfilling these criteria at present are: State of the United Arab Emirates, the People’s Democratic Republic of Algeria, the Kingdom of Saudi Arabia, the Republic of Iraq, the Sultanate of Oman, the State of Qatar, the State of Kuwait, the State of Libya and the Kingdom of Morocco. The rest of the members, according to the weight of their vote in the Board of Governors, take part in selecting the two non-permanent members of the Board of Directors. Currently these are: The Republic of Tunisia and the Arab Republic of Egypt.Membership in the Board of Directors is four-year renewable term. The Board elects among its members, a Chairman for a two-year renewable term. It meets once every four months or whenever necessary.The Director GeneralThe Board of Governors appoints the Director General of BADEA, from non–members of the Board of Directors, for a three-year term renewable twice. The Director General is the chief executive officer of BADEA and responsible for the management of its business, under the supervision of the Board of Directors, in accordance with BADEA’s rules and regulations and in line with the directives of the Board of Governors and the Board of Directors. He is the legal representative of BADEA.

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Meeting of the Board of Governors No. (42) - Manama - April 2016

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Annual Report

(*) Representation in the Board of Governors has been modified during 2016, the Hashemite Kingdom of Jordan used to be represented by H.E. Dr. Omeya Togan until the end of 2015, the Republic of Tunisia by H. E. Mr. Yassen Ibrahim until September 2016, the Repu-blic of Algeria by H.E. Mr. Abdul Rahman Bin Khalfa until June 2016, the Kingdom of Saudi Arabia by H. E. Dr. Ibrahim Ben Abdel Aziz Al-Assaf until October 2016, the Arab Republic of Syria by H. E. Dr. Ismael Ismael until July 2016 and the State of Libya by H.E. Mr. Kamel Ebric Al-Hassi until November 2016.

H.E. Mr. Omar Malhas* Minister of Finance

Hashemite Kingdom of Jordan

H.E. Mr. Ebaid Hameed Al- TayerMinister of State for Finance

United Arab Emirates

H.E. Skeikh Ahmed Ben Mohamed Al-KhalifaMinister of Finance Kingdom of Bahrain

H.E. Mr. Mohamed El-Fadel Abdulkafi*Minister of Development, Investment and

International CooperationRepublic of Tunisia

H.E. Mr. Haji Baba Ammy* Minister of Finance

People’s Democratic Republic of Algeria

H.E. Mr. Mohamed Ben Abdulla Ben Abdul-Aziz Al-Jadaan*Minister of Finance

Kingdom of Saudi Arabia

H.E. Mr. Badr Eldeen Mahmoud Abbas Minister of Finance and Economic Planning

Republic of the Sudan

H.E. Dr. Mamoun Hamdan*Minister of Finance

Arab Republic of Syria

H.E. Mr. Hoshyar ZebariMinister of Finance

Republic of Iraq

H.E. Mr. Derweesh Ben Ismaeil Ben Ali Al-BaloshiMinister Responsible for Financial Affairs

Sultanate of Oman

H.E. Dr. Jawad Naji Hirz Allah The Advisor to the Prime Minister

for Arab and Islamic Funds AffairesState of Palestine

H.E. Mr. Ali Shareef Al-Emadi Minister of Finance

State of Qatar

H.E. Mr. Anas Khaled Al-Saleh Deputy Prime Minister

Minister of Finance State of Kuwait

H.E.Mr. Ali Hassan KhalilMinister of Finance

Republic of Lebanon

H.E. Mr. Osama Saad Hammad Salih*Minister of Finance

State of Libya

H.E. Dr. Sahar NassrMinister of International Cooperation

Arab Republic of Egypt

H.E. Mr. Mohamed Boussaid Minister of Economy and Finance

Kingdom of Morocco

H.E. Mr. Mokhtar Ould DiayMinister of Economy and Finance

Islamic Republic of Mauritania

The Board of Governors



Meeting of the Board of Directors - Khartoum - September 2016

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The Board of Directors

ChairmanH.E. Eng. Yousef Ibrahim Al- Bassam

Kingdom of Saudi Arabia

H. E. Mr. Musabeh Mohamed S. AlsuwaidiUnited Arab Emirates

H. E. Mr. Samir Ben Ibrahim Lazaar Republic of Tunisia

H.E. Mr. Miloud Botaba People’s Democratic Republic of Algeria

H.E. Dr. Huda Hadi Selman Republic of Iraq

H.E. Dr. Abdul Aziz Ben Mohamed Ben Zahir Al Hinai*Sultanate of Oman

H.E. Mr. Ahmed Saleh Bumater Al - MohanadiState of Qatar

H.E. Mr. Marwan Abdullah Yusuf Thunayan Al-Ghanem*State of Kuwait

H.E. Mr. Jumaa Bashir Bu Khadra*State of Libya

H.E. Dr. Mona Mohamed Ahmed Wahba*Arab Republic of Egypt

H.E. Mr. Elhassan Eddez Kingdom of Morocco

Director GeneralH.E. Dr. Sidi Ould TAH

Islamic Republic of Mauritania

(*) Representation in the Board of Directors has been modified during 2016, the Sultanate of Oman used to be represented by H.E. Mr. Hamoud Ben Abdallah Ben Mubarak Al-Alawi until the end of August 2016, the State of Kuwait by H.E. Mr. Abdulrahman Alsayed Hashim until June 14, 2016, the State of Libya by H. E. Mr. Abdallah Ali Khalifa until April 4, 2016 and the Arab Republic of Egypt by H. E. Ambassador Morawan Zaki Badr until April 4, 2016



Hon. The Chairman of the Board of Governors

Arab Bank for Economic Development in Africa (BADEA)

Hon. Chairman,

Pursuant to Articles 25/6, 34/2 and 35 of the Establishing Agreement of the Arab Bank for Economic Development in Africa, I have the honour to submit to the esteemed Board of Governors, on behalf of the Board of Directors, the Annual Report of the Arab Bank for Economic Development in Africa for the year 2016. The Report contains a review of the most important activities of BADEA and a description of the new development operations in the African countries that benefited from its financing during the year. The Report also contains the audited accounts of the year 2016.

Please accept the assurance of my highest consideration

Yousef Ibrahim Al-BassamChairman of the Board of Directors

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The Most Important Performance Indicators of BADEA (2015 - 2016)

Particulars 2015 2016

Total Commitments ($ Million) 410 506

Public Sector Project Loans ($ Million) 200 210

Private Sector Project Loans ($ Million) 50 86

Financing of Arab Exports Loans ($ Million) 150 200

Technical Assistance Grants ($ Million) 10 10

Total Number of Operations 62 75

Number of Public Sector Projects 19 16

Number of Private Sector and Foreign Trade Operations 8 18

Number of Technical Assistance Operations• Feasibility Studies• Institutional Support• Operations within the Framework of the Powers of the

Director General

359

242

419

266

Average of Grant Element for Project Loans (%) 48.76 48.81

Total Cost of Projects Cofinanced by BADEA ($ Million) 687.412 723.44

BADEA’s Contribution in HIPC Initiative ($ Million) 2.284

Net Assets ($ Million) 4,203.9 4,427.7

Total Income ($ Million) 29.7 151.4

Net Income ($ Million) 15.4 123.6



1/ Growth of the World Economy

The growth rate of the global economy remained modest through 2016 at 3.1%, a rate less than that attained in 2015 (3.2%), and less than the previous estimates by 1% as indicated by the International Monetary Fund’s Report of October 2016 on the outlook of the global economy(1).

These preliminary results reflect a slowdown in the projected economic activity in the developed economies and the repercussions of the British referendum that took the United Kingdom out of the European Union, on the one hand, and the growth rate in the United States that proved lower than expected. Data indicate that economic recovery is slowing down to a possible rate of 1.6% in 2016 – i.e. a rate lower by a whole percentage point than the 2015 rate. These negative trends are attributed to a number of interconnected factors, including the impact of the international economic and financial crisis, the slowing in growth of productivity and the “Brexit” vote in the United Kingdom as well as the ensuing economic and political uncertainties, particularly in the advanced European economies.

It is worth noting that the American economy has lost momentum as a result of weak investments, large withdrawal from reserves, and the impact of the raise in the exchange rate of the dollar on investments in export industries, and, perhaps, as a result of apprehensions regarding fluctuations in currency markets, leading to a growth rate that is lower than the estimated rate of 1.1% in the second quarter of 2016.

Equally, the annual growth rate in the Euro zone slowed down to 1.2% in the second quarter of 2016, as a result of the contraction in domestic demand and investment in some of the larger countries in the Euro zone, after the growth rate reached to levels higher than the expected through consecutive quarters.

The annual economic growth rate in the United Kingdom was 2.4% in the second quarter of 2016, before the referendum which was followed by a sharp drop in manufacturing. In Japan, the annual growth rate during the second quarter dropped to 0.8% after reaching 2.1% in the first quarter, due to slowdown in external demand and in corporate investments.

In other developed economies, the growth rate in Canada was negatively affected by the American economic performance indicators which were lower than expected, as well as of the impact of unexpected events such as forest fires, whereas the economies of Hong Kong and Taiwan experienced a surge after the easing of the negative financial and economic effects originating in China. Emerging and developing economies recorded a slight increase in growth rate in the first half of 2016, while other emerging Asian economies recorded strong growth rates. Conditions in countries facing difficulties such as Brazil and Russia reflected a slight improvement.

In China, the economic growth rate stabilized during the first half of the year at 6.5% - 7%, close to the mid-point of the range targeted by the authorities. This growth was bolstered by reform policies and the strong trends in credit and consumption and the shift from manufacturing to services within the process of regaining equilibrium. India, on the other hand, registered a high rate of growth as a result of the considerable improvement in the rates of trade exchange and the effective measures resulting from reform policies.

Over of International Economic Development

(1) WEO – IMF – October, 2016

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With regard to Latin America, stagnation continued in Brazil despite signs of resumption of economic activity after the negative impact of previous economic shocks. In Russia, there are signs of economic stability as the country is adjusting to the double shock precipitated by the fall in oil prices and by economic sanctions, in addition to strengthening of capital reserves of banks by infusion of public resources.

With regard to Sub-Saharan African countries, economies registered a significant regression, particularly in oil and minerals exporting countries, such as Nigeria which was negatively affected by the fall in oil prices, the interruption of production due to shortage of foreign currency and electricity outages and the impact of armed conflicts. The same situation is facing Angola. The economies of Cote d’Ivoire, Kenya, Senegal and Tanzania were resilient as they are not dependent on oil and minerals’ exports. As to countries of the Middle East, their economies continue to suffer the sharp fall in oil prices.

2/ Inflation, Employment and Unemployment

a) Inflation

Statistics indicate an increase in inflation rates in developed economies to 0.8% in 2016 compared to 0.3% in 2015, as a result of the decrease in energy cost. The rate of inflation is expected to increase during the coming few years, due to the relative increase in oil prices and the gradual contraction in production gaps, to reach the levels targeted by central banks in 2020. As to developing markets and economies, reports indicated that inflation is falling to 4.5% in 2016 compared to 4.7% in 2015, except in Venezuela and Argentina where the inflation rate remained high.

In the United States of America, the consumer price index rose from 1% in 2015 to 1.3% in 2016, and is expected to rise to 2.3% in 2017. The Euro zone is witnessing an increase in inflation rates, reaching 0.3 % in 2016 compared to about 0% in 2015. This increase is expected to continue in a gradual upward trend in the coming period, to be a rate below the level targeted by the European Central Bank by 2021, reflecting the gradual bridging in productivity gaps and the stability of inflation estimates.

In Japan, the rate of inflation is expected to increase slowly but remained below the rate targeted by Japan Central Bank, while in the UK, the fall in the exchange rate of the Sterling Pound is expected to increase the inflation rate to around 0.7% in 2016 and 2.5% in 2017, before it stabilizes at 2% during the coming years, as targeted by the Central Bank.

Inflation rates are still sluggish in most of the other advanced economies. In Korea, Sweden and Taiwan, estimates indicated that the inflation rate will rise to reach in 2016 the targets set by central banks. In China, it is expected that the inflation rate will rise to 3.1% in 2016, bearing in mind the stagnation in manufacturing and pressures that lower prices.

In most eonomies of other major emerging markets, such as Brazil, Russia and Turkey, inflation rates surpassed the targets set by central banks, but are expected to fall gradually, due to the easing of the pressures resulting from falling in currency exchange rates. In Mexico, on the other hand, it is expected that the inflation rate will be closer to the target set by the Central Bank, while it is expected that the inflation rates in Poland and Hungary will rise slowly after falling sharply in 2015.

In Sub-Saharan African countries, inflation rate registered 9% in 2016 compared to 7% in 2015. In some of the major economies in that region, inflation climbed to double digits reflecting the effects of the sharp fall in currency exchange.



b) Employment and Unemployment

The global unemployment rate in 2016 was 5.7% and it is expected to remain high in the short term as the global work forces grow, to reach 5.8% in 2017. This increase represents an increase of 3.4 million unemployed to make the total number of unemployed around the world 201 million in 2017. Despite the expectations of stable global in unemployment rate in 2018, the high rates of growth of the work force will surpass the pace of job creation, leading to an increase in the numbers of the unemployed to around 2.7 million persons(1).

In emerging economies, and due to the worsening employment climate, estimates indicate the increase in unemployment figures from 5.6% in 2016 to 5.7% in 2017. It is expected that the rate of unemployment increase by 0.3% in 2017 to reach 8.4% in the Latin America and Caribbean region, mostly in Brazil.

On the other hand, it is expected that rates of unemployment will fall in 2017 in developed countries from 6.3% to 6.2 %, representing 670,000 unemployed, and that the levels of unemployment will continue to rise in developing countries to reach 5.5% in 2017 and 2018.

In Sub-Saharan African countries, the unemployment rate reached 7.2% in 2016 and is expected to be stable at that rate during 2017. Despite this stability in unemployment figures, the number of unemployed is expected, however, to increase to 28 million in 2016 and to 29 million in 2017, due to the continuous increase in the growth rate of the working force.

3 / International Trade

Growth in the volume of global trade declined significantly in the second half of 2014, in parallel with the sharp fall in the price of oil and primary commodities. Forecasts indicated that the growth rate will reach 4.3% in 2016, slightly less than in 2015, either in absolute value or in comparison to the rate of growth of global GDP. It is worth noting that the poor performance in the private investment in most developed, emerging and developing economies, played a significant role in the decline of global trade. It is also worth noting that the shift in China to depend on consumption instead of investment, and the decline in capital to face the decline in the price of primary commodities in several countries, will lead to additional slowing in the growth of trade.

Forecasts indicate an increase in the rate of growth of international trade to 4.3% in the medium term(2), reflecting the expected recovery in economic activity and investments in emerging and developing economies and the recovery of developed economies, though at a lower rate. The imbalance in global current account during 2016 is still affected by the sharp fall in oil prices during the last two years and the substantial disparities in the rate of growth of global demand between the different regions of the world.

4 / External Indebtedness and Highly Indebted Poor Countries (HIPIC)

a) External Indebtedness

The volume of external debt of Sub-Saharan African countries is estimated, according to World Bank statistics(3) at about 416.3 billion dollars in 2915, compared to about 402.8 billion dollars in 2014, representing an increase of 3.3%. As to the debt structure, long term loans constitute 82% of the total debt stock, while 18% are short term loans. Disbursements from these loans in 2015 were estimated at 54.4 billion dollars, while reimbursement amounted to 17.4 billion dollars.

(1) World Employment Social Outlook – Trends – January, 2017 (2) WEO – IMF – October, 2016 (3) World Bank – International Debt Statistics – Region Tables – Sub-Saharan Africa, 2017.

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Debt servicing was estimated at 27.8 billion dollars, while debt servicing rate to exports was estimated at 7.8% in 2015 compared to 7.3% in 2014. Debt rate extended to Sub-Saharan African counries on concessional terms, stood at 30.2% of the total external debt volume. Obligations of the region to multilateral institutions represented 19.9% of the total volume of external indebtedness. On the other hand, the volume of direct foreign investment flows into the region in 2015 stood at 34.7 billion dollars compared to 33.4 billion dollars in 2014, while portfolio investments amounted to 6.8 billion dollars compared to 4.6 billion dollars in 2014.

b) Highly Indebted Poor Countries (HIPIC)

Thirty-nine countries in the world are classified as Highly Indebted Poor Countries in 2016, thirty among which are some African countries eligible for BADEA’s assistance. Debt have accumulated over the last few decades, creating a heavy burden on the economies of these countries, rendering them unable to repay these debts in the absence of external assistance. In the light of this situation, the international community launched a debt relief initiative for the highly indebted poor countries (HIPIC) in 1996, followed by the Multilateral Debt Relief Initiative (MDRI). Thirty-nine countries that are heavily indebted qualified to benefit from the both initiatives in 2016; 36 of which reached the Completion Point, including 29 African countries eligible for BADEA assistance.

The resources devoted to debt relief within the HIPIC initiative totaled 75 billion dollars at the end of 2016, whereas the total debt relief resources under the MDRI totaled 41.6 billion dollars, making the total sum under both initiatives 116.6 billion dollars. The total contribution of BADEA under the HIPIC from 1997 to 2016 amounted to about 258.85 million dollars, benefiting 29 African countries.

5 / World Economic Outlook for 2017

Estimates in the IMF’s World Economic Outlook for 2016 indicate an increase in the rate of growth reaching 3.4% by 2017. This expected increase in the rate of growth is predicated on the continuing growth in the economies of emerging markets estimated to reach 4.3% after the slowdown of five consecutive years. This rate represents more than 75% of the global growth in 2016. Estimates also indicate that the impact of the easing of the pressures reducing economic activities in countries that experienced stagnation in 2016 such as: Brazil, Nigeria and Russia, will offset the negative results of the slowing down of growth in China. In developed economies, it is estimated that the rate of growth will witness a slight increase reaching 1.7% in 2017, reflecting the expected sustained recovery in the United States and Canada.

In the United States of America, it is expected that the rate of growth will reach 2.2% in 2017, as a result of the fall in oil prices, increase in the rate of exchange of the dollar and sustained consumer spending. On the other hand, it is expected that the rate of growth in the Euro zone will slow down in 2017 to 1.5% compared to 1.7% in 2016, due to the economic repercussions of “Brexit” and the accompanying apprehensions and uncertainties. It is estimated also that recovery will continue with lower rates in 2016 and 2017 compared to the rates of 2015. The fall in oil prices, the limited expansion in public financing and the easing of the fiscal policies are expected to support the economic growth, whereas economic activity will be substantially affected due to the impact of “Brexit” on the investors’ confidence. In the United Kingdom, growth rate is expected to slow down to 1.1% in 2017 compared to 1.8% in 2016, on the assumption of smooth negotiations to withdraw from the European Union.

In Japan, growth is expected to continue to be weak; the rate was 0.5% in 2016 and expected to rise to 0.6 in 2017, despite the measures adopted to support the private economy such as tax breaks, the complementary budget and the additional easing in the fiscal and monetary policies. As to the



other developed economies in Asia, it is expected that the rate of growth in Singapore will slow down from 1.7% in 2016 to 1.4% in 2017, while the rate is expected to rise in Korea to 2.7% and to be 1% in Taiwan. Estimates indicate that growth will resume in a robust rate in these fully integrated economies during 2017, due to the expansion in the volume of global trade and the resulting increase in their exports.

The Chinese economy is projected to grow by 6.2% in 2017 compared to 6.6% in 2016. Other emerging and developing countries in Asia are expected to experience robust growth. India is expected to have a GDP growth rate higher than that of the other major economies in Asia, the rate of economic growth may reach 7.6% in 2017, as result of growth in trade exchange and the positive measures in policy and structural reforms. As far as the other five Asian economies are concerned (Indonesia, Malaysia, Philippine, Thailand and Vietnam), growth rate is expected to be 6.1% in 2017.

The slowdown in economic activity in the Latin America and the Caribbean region persisted, but recovery is expected in 2017, raising the growth rate to 1.6% after the 0.6% contraction during 2016. In Brazil, however, the level of confidence is improving and growth rate is estimated to be 0.5% in 2017, on the assumption the uncertainty regarding the political situation will recede together with the impact of the previous economic shocks.

In the countries of Sub-Saharan Africa, the disparity in rates of growth between countries is increasing and estimates for growth in this region were scaled down, where the growth rate reached 1.4% in 2016(*). This was considered to be the lowest rate in two decades during which these African countries registered an average growth rate of about 5%. This sharp regression reflects the fall in oil and primary commodities revenues in countries dependent on these commodities, including Nigeria, Angola and South Africa.

On the other hand, it is expected to see a sustained growth at robust rate of more than 5% during 2016 in a number of countries - exporters of commodities other than oil and minerals, including Cote d’Ivoire, Ethiopia, Kenya and Senegal, buoyed by the fall in oil prices, consumer spending and new investments. In 2017, the growth rate in this region is projected to reach 2.9%.

(*) Regional Economic Outlook – Sub-Saharan – Multispeed Growth – October, 2016

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PART ONE

Financial ActivitiesIntroduction

BADEA continued in 2016 the implementation of its Seventh Five-Year Plan (2015 – 2019), the Plan that has paid a great attention to the financing of the private sector and the Arab exports to African countries eligible for BADEA’s assistance. An amount of 450 million dollars was allocated, during the Plan period, to finance the private sector, while an amount ranges from 150 to 250 million dollars was allocated annually to finance the Arab exports (revolving amount). Allocations for public sector projects were increased to reach 1100 million dollars, and those for technical assistance to reach 50 million dollars, distributed equally over the years of the Plan (10 million dollars annually).

Regarding the sectoral distribution of projects approved in 2016, infrastructure sector represents an important priority of the Plan, due to its vital role in the development of the other sectors and creation of job opportunities. Public sector commitments in 2016 covered the infrastructure in the field of transportation. Agriculture and rural development sector also received a great portion of the commitments during the year, due to its direct impact in bridging the food gap in the beneficiary countries, in alleviating poverty in rural areas and in the economic empowerment of women. The commitments also included the social sector (health and education), because of the increased demand from the Governments to support this sector and the expansion in the sectors that require more professional and skilled labor.

Regarding the lending terms, BADEA continued in 2016 extending its loans in concessionary terms, in recognition of the nature of the funded projects and the economic realities of the borrowing countries, mostly in the low-income group.

BADEA also continued– during the year - its contribution towards the Initiative of debt burden relief of the African countries beneficiary of its assistance, and to coordinate with the development finance institutions, especially the Arab ones, regarding the co-financing of the major projects.

BADEA’s Total Commitments in 2016

Total commitments in 2016 stood at 506 million dollars (table II), the equivalent of 97.3% of the planned allocations, of which 210 million dollars were earmarked for the public sector to finance 16 development projects and 86 million dollars for the private sector, extended as credit loans to 8 African banks, thus a marked expansion in financing this sector was achieved. Equally, an amount of 200 million dollars was allocated to finance Arab exports to African countries, through lines of credit extended to 10 financial institutions interested in this sector. The total commitments during the year also included 10 million dollars to finance technical assistance operations.

Financing in 2016 exceeded those of 2015 by 23.4%, where allocations for the Arab exports increased by about 33.3%, for the private sector by about 72% and for the public sector projects by about 5%.

Public Sector Loan Commitments and their Sectoral Distribution in 2016

In 2016, public sector loan commitments and their distribution by sectors have been essentially based on the principles of the 7th Five-Year Plan (2015 – 2019) and the priorities expressed by the Governments of the beneficiary countries. Commitments covered infrastructure, agriculture and rural development and social sectors, as follows:

• Infrastructure sector received the largest share of the total commitments, amounting to 98.50 million dollars and representing about 46.9%. The projects of infrastructure included 7 road projects with a percentage of 100%.



(*) Includes credit loans extended to the Governments to re-lend them as micro finances to combact poverty.

• Allocations for agriculture and rural development sector amounted to 59 million dollars, representing about 28.1% of the total commitments. They included 4 projects, distributed between rural agricultural development (2 projects), rural electrification (one project) and supplying of drinking water to some villages (one project).

• Allocations for social sector amounted to 52.5 million dollars or about 25% of the total commitments, earmarked to finance 5 projects, 4 projects in health sub-sector and one (1) project in education sub-sector

Table ISectoral Distribution of Public Sector Loans for the Years 2015 & 2016

Sector Number of Projects

Amount ($ Million)

Percentage (%)

2015 2016 2015 2016 2015 2016Infrastructure 10 7 112.8 98.5 56.4 46.9

Agriculture and rural development 3 4 35.6 59.0 17.8 28.1

Social 5 5 46.6 52.5 23.3 25.0

Private (directed to Governments) * 1 ― 5.0 ― 2.5 ―

Total 19 16 200.0 210.0 100.0 100.0

As can be seen in table (I), the total commitments for the public sector amounted to 210 million dollars, equivalent to 100% of the 7th Five-Year Plan target for the Year 2016.

Lending Terms

BADEA continued in 2016 to extend its loans in concessionary terms, in recognition of the nature of the funded projects and the economic realities of the borrowing countries, mostly in the low-income group. These concessional terms enabled the beneficiary countries to obtain loans with high grant element, in line with international organizations lending policies concerning the low-income countries.

The weighted-average of the interest rate charged on BADEA’s loans stood at about 1.05% in 2016, as opposed to 1.12% in 2015, while the weighted average of the loan duration was 30.31 years in 2016, compared to 29.85 years in 2015. The weighted average of the grace period was 9.76 years in 2016, representing a slight increase from the average of 9.48 years registered in 2015 (Table III).

Consequently, the grant element average, which is a measure of the softness of the loans, registered 48.81% in 2016, a slight increase from the average of 48.76% registered in 2015, calculated on a base of a discount rate of 5% which was the same rate in 2015.

The grant element embedded in BADEA’s loans reflects its support to the African countries and appreciation of the critical economic and financial circumstances they face. It also reveals BADEA’s keenness to assist these countries in meeting their respective debt obligations.

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Table IIBADEA’s Approved Commitments During 2016(1) The Loans

(A) Public Sector Loans

Country or Institution Project Name Date of Approval

Loan Amount

($ million)

Interest Rate (%)

Loan Duration (Years)

Grace Period (Years)

Grant Element

(%)

Chad Construction of Small Dams for Agriculture and Livestock in Rural Areas 03 March, 2016 20 1 30 10 49.4

Cote d’Ivoire Construction and Equipping of a Regional Hospital in Yopougon 03 March, 2016 12 1 30 10 49.4

Kenya Upgrading of “Gilgil – Machinery” Road 03 March, 2016 11 1 30 10 49.4Liberia Upgrading of “Gbarnga– Salayea” Road 03 March, 2016 12 1 30 10 49.4Mali Supply of Electricity to Some Villages

through Hybrid Solar 03 March, 2016 10 1 30 10 49.4

MozambiqueConstruction of Geology Department and Administration Buildings - Faculty of Science - University of Eduardo Mondlane

03 March, 2016 10 1 30 10 49.4

Senegal Supply of Drinking Water to the Islands of Lower Casamance 03 March, 2016 9 1 30 10 49.4

Uganda Upgrading of “Luwero – Butalangu” Road 03 March, 2016 11.50 1 40 10 55.3Zambia Construction of Cancer Treatment Centers 03 March, 2016 10 1 30 10 49.4Ethiopia Upgrading of “Hamusit - Estie“ Road 03 June, 2016 15 1 30 10 49.4Guinea Rural Development in Some Areas 03 June, 2016 20 1 30 10 49.4Mali Kwala – Nara – Mauritania Borders Road

– First Phase: «Kwala – Nara» 03 June, 2016 10 1 30 10 49.4

Swaziland Construction and Equipping of the National Specialized Hospital 03 June, 2016 10 2 25 5 31.7

Tanzania Rehabilitation and Expansion of “Mnazi Mmoja” Hospital in Zanzibar 03 June, 2016 10.50 1 30 10 49.4

Burkina Faso Construction of “Wahigoya – Djibo” Road 28 September, 2016 19 1 30 10 49.4

Niger Construction of “Filingue – Tahoua” Road – Section: “In’karkadan -Tahoua” 28 September, 2016 20 1 30 10 49.4

Total 210(B) Private Sector Loans “SONI BANK” in the Republic of Niger 03 June, 2016 5The Development Bank of Rwanda 03 June, 2016 15The Eastern and Southern African Trade and Development Bank (PTA Bank) 03 June, 2016 15 Central African States Development Bank (BDEAC) 03 June, 2016 15 (TIB) Development Bank in the Republic of Tanzania 28 September, 2016 10Uganda Development Bank Limited (UDBL) 28 September, 2016 6Liberian Bank for Development & Investment (LBDI) 14 December, 2016 5“ECOWAS” Bank for Investment and Development 14 December, 2016 15Total 86

(C) Arab Exports to African Countries Loans“SONI BANK” in the Republic of Niger 03 June, 2016 5East African Development Bank “EADB” 03 June, 2016 15SODECOTON – Republic of Cameroun 28 September, 2016 25The Government of the Republic of Niger 28 September, 2016 25“AMEN Bank” – Republic of Tunisia 28 September, 2016 20Uganda Development Bank Limited (UDBL) 28 September, 2016 10The Government of the Republic of Chad 14 December, 2016 25The Government of the Republic of the Gambia 14 December, 2016 20Liberian Bank for Development & Investment (LBDI) 14 December, 2016 10“ECOWAS” Bank for Investment and Development 14 December, 2016 45Total 200Total Amount of Public and Private Sectors and Arab Exports Loans 496



(2) The Technical Assistance Operations (continued to table II)

Country or Institution Technical Assistance Date of Approval ($ Thousand)

Central African Republic An Arab expert to the Ministry of Economy, Planning and International Cooperation 03 March, 2016 320

Gabon Support to the National Investment Promotion Agency 03 March, 2016 250

Madagascar Preparation of Master Plan for the transportation sector in “Antananarivo” 03 March 2016 500

Regional Support to the Arab Electronic Portal (Phase 3) 03 March 2016 300

Regional Support to the 18th Conference for the Micro Credit Summit 03 March 2016 170

Regional Road Show on the Private Sector Investment Conference in the Great Lakes Region 03 March 2016 100

Regional Support to the African Program for Fighting River Blindness. 03 March 2016 300

Regional An Arab expert to support the African Campaign to Fight Tsetse Fly 03 March 2016 370

Regional Participation in the Program for Fighting Blindness 03 March 2016 300

Regional Training course in preparation, analyzing and evaluation of agricultural projects 03 March 2016 125

Regional Feasibility study for the establishment of regional Airline for the Sahel Group 03 March 2016 500

Regional Forum for Promotion of Arab Exports to Some African Countries 03 March 2016 280

Regional Study on the effectiveness of Technical Assistance operations 03 March 2016 310

Regional Guide to support the partnership between Arab and African regions 03 March 2016 370

Cote d’Ivoire Preparation of Soil Fertility Map for Belier and Boro regions 03 June,2016 350

Mozambique Financing of a Forum for Attracting the arab Investment to Mozambique 03 June,2016 450

Niger Feasibility study for Water Supply Project in Some Rural Areas 03 June,2016 500

Seychelles An Arab expert to support the Public Utilities Authority 03 June,2016 320Regional Study on Joint Arab - African Trade Fairs 03 June,2016 160Regional Support to the Conference and Fair of Arab - African Businesswomen 03 June,2016 265Regional Financing the International Conference on Climate Change 03 June,2016 300Regional Study for evaluation of Arab-African Partnership (2011-2016) 03 June,2016 240Regional Training program for enhancing capabilities in the private sector development 03 June,2016 490Regional Financing of Arab – African Trade Partnership Program 03June,2016 300

Guinea An Arab expert to support the Ministry of Planning & International Cooperation 28 September, 2016 320

Regional Organizing the African Forum on Investment and Business 28 September, 2016 280Regional Support to the International Conference on the «Quinoa» Crop 28 September, 2016 40Regional Training course in the field of artificial insemination of cows 28 September, 2016 140

Regional Arab-African Forum to Support the Partnership and Economic Integration 28 September, 2016 200

Regional Contribution to the celebration of the 50th Anniversary of the UNIDO 28 September, 2016 170

Regional Support to the Arab - African Economic Forum 28 September, 2016 280Chad An Arab expert to support the Program of Teaching Arabic Language 14 December, 2016 320Niger Institutional support to the Ministry of Planning 14 December, 2016 220Tanzania An Arab expert to support the Ministry of Finance in Zanzibar 14 December, 2016 320Regional Arab Consultants and experts in short missions July, 2016 14.70

Operations Within the Framework of the Powers of the Director General

Regional Support to the participation of FGCCC in the Private Investment Conference in the Great Lakes Region February, 2016 15

Regional Financing of an event on the sidelines of the Conference of African Finance Ministers February, 2016 15Regional Workshop on the Prospects of Agricultural Investment Opportunities in Africa February, 2016 15Regional Support to the 4th Forum for the Development of Enterprises in West Africa March, 2016 15

Regional An introductory meeting on BADEA’s programs for financing private sector and foreign trade April, 2016 15

Regional Support to the meeting of the Arab - African Youth Council September, 2016 15

Total Amount 10.000*

(*) Including an amount of 35.30 thousand dollars, to increase the allocations of an Arab expert to support Pan African Centre for Mathematics.

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(1) Cancellations have been deducted from the total commitments of the year when the Board of Directors had given its approval.(2) A loan is considered concessionary if the grant element is 25% or more.(3) The grant element was calculated on the base of a discount rate of 10% in 2002 and before. In 2003 it was changed to 5%, in the years 2006, 2007

and 2008 to 6.5%, in the years 2009, 2010, 2011 and 2012 to 4.035%, 5.30%, 4.43% and 3.88% respectively, in 2013 to 5.58%, in 2014 to 5.21% and in the years 2015 and 2016 to 5%.

* Interest rate, repayment period, grace period and grant element were calculated as weighted averages by the value of the loan of each project.

Table IIIEvolution of Financial Activity of BADEA’s Operations (1975 – 2016)

(Loans & Grants / $ Million )

Year Total Annual Commitments

Net Annual Commitments(1)

Interest Rate(%)*

RepaymentPeriod Rate

(years)*

GracePeriod Rate

(years)*

Grant Element Rate % (2) (3)*

1975 85.500 68.033 3.70 23.60 5.20 44.681976 62.000 56.823 2.90 22.80 5.00 49.781977 66.290 64.226 5.00 16.10 4.40 29.911978 72.870 48.601 3.70 18.10 5.20 40.841979 49.070 41.916 4.30 17.20 4.40 35.201980 71.950 48.066 5.60 15.90 3.80 25.441981 76.026 41.284 5.90 14.40 4.20 23.011982 90.000 48.180 6.00 16.00 4.70 23.841983 83.933 62.120 6.50 15.00 4.20 19.721984 87.960 43.178 6.60 14.20 3.70 18.241985 73.790 35.785 5.90 15.90 4.30 24.051986 58.605 36.937 4.20 16.50 4.20 35.021987 71.423 28.604 4.60 16.20 4.70 32.841988 66.720 49.151 4.30 17.00 4.30 34.901989 72.000 53.618 4.20 18.00 5.20 37.611990 73.682 32.565 3.90 18.40 4.30 39.161991 74.235 34.613 3.90 17.80 3.80 37.431992 73.726 54.157 3.40 17.93 4.20 40.971993 74.654 48.521 3.40 17.50 4.20 40.971994 74.307 55.998 3.40 18.00 4.10 42.001995 79.930 73.000 3.15 18.17 4.42 43.451996 89.938 78.467 3.26 18.50 4.34 42.611997 99.830 76.536 3.05 17.80 4.36 43.751998 109.940 69.535 3.10 18.10 4.38 42.701999 119.520 95.700 3.05 18.20 4.77 43.702000 123.950 115.789 2.29 25.95 5.62 58.152001 129.200 101.292 2.03 26.23 5.65 58.802002 134.390 132.150 1.43 27.25 7.21 65.402003 139.990 120.980 1.70 27.45 6.73 36.402004 144.970 138.906 1.36 27.67 7.62 42.722005 159.939 143.305 1.15 29.08 8.56 45.112006 169.945 155.258 1.31 28.78 9.20 54.942007 179.600 175.956 1.28 28.66 9.22 57.942008 190.000 189.008 1.50 27.40 8.46 50.482009 200.000 188.740 1.33 29.06 9.12 46.582010 200.000 198.214 1.11 29.14 9.69 49.522011 200.000 199.146 1.08 29.60 9.59 43.182012 200.000 187.582 1.17 29.38 9.44 36.262013 200.000 187.654 1.21 29.89 9.33 48.042014 200.000 199.576 1.11 29.47 9.70 50.742015 260.000 259.909 1.12 29.85 9.48 48.762016 306.000 305.928 1.05 30.31 9.76 48.81



(1) The Special Arab Aid Fund for Africa (SAAFA) was established in November 1973 and started operations in November 1974 to provide loans to African countries to help the overcome of difficulties in obtaining foreign financing and to support their balance of payments. It was administrated by the League of Arab States up to 1976 when BADEA took over the management of its operations. In 1977 its resources were merged into BADEA’s capital and its basic activity of non-project lending came to an end.

Loan Commitments and their Sectoral Distribution during 1975 - 2016

The total cumulative commitments made by BADEA during the period 1975 -2016 stood at 5,095.883 million dollars; out of which 4,925.17 million dollars were allocated to finance 631 development projects. Net project loans commitments amounted to 4,194.206 million dollars, out of which infrastructure sector received 2,272.214 million dollars (representing about 54.18% of the total), the agriculture and rural development sector received 999.679 million dollars (about 23.83%), the energy sector received 172.664 million dollars (about 4.12%), the industry sector received 51.529 million dollars (about 1.23%), the social sector received 427.564 million dollars (about 10.19%), the private sector directed to Governments received 191.921 million dollars (about 4.58%), the private sector – in form of loans of credit to banks – received 66 million dollars (about 1.57%) and the Urgent Aid Program received 12.635 million dollars (about 0.30%).

As for the loans of the Special Arab Aid Fund for Africa (SAAFA)(1) totaling 59 loans provided to African countries to support their balance of payments, the total commitments of this Fund amounted to 214.244 million dollars. So, the total net commitments including SAAFA loans and project loans amounted to 4,408.45 million dollars by the end of 2016.

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Urgent Aid: 12.635 (0.30%)

Social sector: 427.564 (10.19%)

Industry: 51.529 (1.23%)

Private sector: 257.921 (6.15%)

Energy: 172.664 (4.12%)

Agriculture and rural development: 999.679 (23.83%)

Infrastructure: 2,272.214 (54.18%)

African Trainees (1975 - 2016)

Total : 10192 Trainees، 244 Training Sessions

Num

ber o

f Tra

inee

s

0

1000

2000

3000

4000

5000

18020162015201420132012201120101975-2009

806309

567

3355

335

4186

454

2016 - 1974

2005 - 1974

1995 - 1974

1985 - 1974

4,335.007

2,314.066 1,567.890

1,239.783 907,690

772.619 576.362

3,029.063

6,122.145

3,465.180

4,549.3

4.500

.000

4.000

.000

3.500

.000

3.000

.000

2.500

.000

2.000

.000

1.500

.000

1.000

.000

500.0

00

000.0

00

3,049.1

506.3

3,797.7

4,509.042

1,666.080

771.960

1,801.8801,584.090

0.000

1,000.000

2,000.000

3,000.000

4,000.000

5,000.000

6,000.000

7,000.000

Sectoral Distribution of Net Loan Commitments (1975 – 2016)

Distribution of Technical Assistance into Feasibility Studies and Institutional Support (1975 – 2016)

Evolution of Net Commitments & Disbursements (1974 - 2016)

Co-financing (1975 - 2016)

Million $

94,946 Million $55,62%

75.767Million $44,38%

Institutional Support449

Operations% 64.56

Feasibility Studies 247

Operations% 35.44

Million $

Total: 696 Operations

CommitmentsDisburstments

Total cost of projects 19920.377 millions $

BADEAAfrican

Development Bank Group

World bankGroup

EuropeanUnion

Arab Funds,Islamic Bank

and OFID

IndustrialCountries

.

BeneficiaryGovemments and

local entities

Financial Resources at 31/ 12/ 2016

General Reserve

Disbursements

Paid-Up Capital

Cumulative Net Commitments

Million $

Million $

Million $

Social Sector Projects (Health and Education)

BADEA allocated 52.50 million dollars in 2016 to finance 5 projects in the social sector, of which 4 projects in health sub-sector in Zambia, Côte d’Ivoire, Swaziland and Tanzania, at a total cost of 42.50 million dollars and one (1) project in education sub-sector in Mozambique, at a cost of 10 million dollars.

Thus, during the period 1995 - 2016, the cumulative commitments of BADEA for the social sector amounted to 437.634 million dollars, including 76 projects in health and education. This in addition to financing social components of development projects in the period prior to 1995. BADEA’s interventions in the social sector are in consistency with the global trends in development, which aim essentially to poverty reduction and human development.

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The Private Sector

BADEA continued to devote growing attention to the private sector in its funding operations, due to the important role this sector plays in the economic development of any country, including African countries eligible for BADEA’s support. For this purpose, a number of loans of credit have been extended to banks and national and regional development financial institutions, to re-lending them to finance private sector sub-projects. Its contribution in this area also included extending loans to Governments of the respective African countries, for re-lending them directly to the private sector. In addition, BADEA funds components to support this sector within the projects it co-finances.

During the period 1975 – 2014, 45 loans were approved for the private sector, of which 34 loans of credit were offered through intermediary financial institutions, while the rest were channelled through Governments to finance private sector projects.

The total net of commitments of these loans amounted to 116.931 million dollars, benefiting small projects in industrial, agriculture and rural development, transport and small and micro-finance sectors, this in addition to several feasibility studies which generated private sector projects that could be bankable.

The private sector also benefited from training programs, forums and exhibitions financed by BADEA, in addition to trade operations.

The year 2015 marked the launching of “the Private Sector Financing Program”, which was approved by the Board of Governors pursuant to its Resolution No. (6) for 2014, in the context of BADEA’s Seventh Five-Year Plan (2015 – 2019), where total allocations of 450 million dollars was earmarked for the private sector, as follows:

Year 2015 2016 2017 2018 2019Private Sector ($ Million) 50 100 100 100 100

BADEA continued to implement its Program which entered its second year in 2016, where loans of credit amounting to 86 million dollars were approved to 8 financial institutions, compared to loans of credit amounted to 50 million dollars approved in 2015 to 4 financial institutions.

The loans of credit of 2016 included: 3 multilateral regional Development Financial Institutions (each received a funding of 15 million dollars), a financial institution in the Republic of Rwanda (15 million dollars), a financial institution in the United Republic of Tanzania (10 million dollars), a financial institution in the Republic of Uganda (6 million dollars), a financial institution in the Republic of Niger (5 million dollars) and a financial institution in the Republic of Liberia (5 million dollars).

The year 2016 witnessed the signature of loans of credit agreements with 3 financial institutions, at a total cost of 42 million dollars. The signed agreements comprised 2 private sector operations approved in 2015 and one (1) private sector operation approved in 2016, out of which two agreements were declared effective and the respective financial institutions have already commenced withdrawal from the loans.

The year 2017 is expected to witness signature of more agreements as well as increasing in withdrawal operations from the loans approved in 2015 and 2016, thus contributing in provision of financial resources to African private sector institutions and in achieving the required development impact of the private sector Program, aiming to support the African economies, through developing their basic infrastructures and promotion and provision of investments which constitute one of the main pillars for increasing production and income, creating job opportunities.



Financing of Arab Exports to African Countries

In recognition of its vital role in the development process, BADEA has placed a special attention to the promotion of trade exchange between Arab and African countries. Beside securing of funding and supporting investment to stimulate production capacities, there is no doubt that trade exchange and smooth movement of goods and services are critical for the availability of production inputs, as well as for the exchange of finished products in local and international markets.

In line with its initiatives to support trade exchange between African countries and other countries of the world, BADEA contributed 10 million dollars in the capital of the African Export-Import Bank (AFRIEXIMBANK). It also allocated 100 million dollars to finance Arab exports to African countries (Arab Exports Financing Scheme), of which 75 million dollars were managed by the Islamic Development Bank Group in accordance with an agreement signed in 1998, renewed with the International Islamic Trade Finance Corporation in 2008 and expired in 2014.

BADEA explored alternative options for utilization of the remaining 25 million dollars, where the Board of Directors decided to use the sum in form of lines of credit, to be extended to Arab banks, in order to contribute in financing Arab exports to African countries.

Total approvals till the end of the Program in 2014 amounted to 399.5 million dollars, of which 187 million dollars were withdrawn to finance 29 operations for the benefit of: Tanzania, Guinea, Mauritius, Zimbabwe, Seychelles, Zambia, Cote d’Ivoire, Kenya, Senegal and Gambia. It is to be noted that some of these countries benefited from more than one operation.

Since the beginning of the year 2015 and pursuant to the Resolution No. (6) of 2014 of the Board of Governors (above-mentioned) a new program for financing Arab exports was approved and annual amounts (revolving) were allocated for the years 2015 -2019 as follows:

Year 2015 2016 2017 2018 2019Financing of Arab Exports ($ Million) 150 200 200 225 250

In 2016 an amount of 200 million dollars was approved compared to 150 million dollars in 2015. Financing of 2016 included 10 lines of credit, of which 6 lines of credit to financial institutions and 4 lines of credit to the Governments of: Chad, Gambia, Niger and Cameroon, in order to import goods and products from Arab countries, such as fertilizers, agricultural inputs and others.

Since the year 2016 represents the second year of the Program, it witnessed growth and diversity in the financed operations as compared to 2015. Equally in 2016 a line of credit was extended to an Arab Bank (AMEN Bank in Tunisia) to finance the Tunisian exports to Sub-Saharan African countries.

Regional Operations

Projects and technical assistance operations of regional character have been given emphasis by BADEA for their positive impact on more than one African country and sometimes on neighboring Arab countries, paving the way for cooperation between them.

BADEA contributed 49 million dollars, representing 23.3% of its total project loans for 2016, to finance 3 regional road projects, namely: “Kwala- Nara” Road Project (section of the Road “ Kwala - Nara - Mauritania boarders), “wahigoya - Djibo” Road Project in Burkina Faso, which is of particular importance to facilitate transit trade with neighboring countries (Mali and Niger), and “In’karkadan – Tahoua” Road Project (section of the Road Filingue - Tahoua) in Niger which will smooth trade exchange between North-African Arab countries and some of African countries (Mali, Niger, Burkina Faso, Chad and Nigeria).

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Within its regional operations, BADEA provided a grant amounting to 0.5 million dollars to finance a feasibility study to establish a regional airline for G5 countries (Burkina Faso, Mali, Mauritania, Niger and Chad), which aims at facilitating the air transport between the member states. Thus, total allocations for regional operations have reached 49.50 million dollars.

Technical Assistance Operations and their Sectoral Distribution in 2016

In accordance with the guidelines of the 7th Five-Year Plan (2015 - 2019), BADEA has continued to provide technical assistance to the African beneficiary countries, through financing of technical and economic feasibility studies for development projects and providing institutional support. The later includes: Training courses, provision of services of Arab experts, provision of equipment and instruments and organizing forums and meetings for economic actors in Africa and the Arab World. The beneficiaries of this assistance are the governmental departments and agencies, the private sector and the regional African organizations.

The technical assistance operations approved in 2016 totalled 41 operations, at a total cost of 10 million dollars, of which 6 operations amounted to 90 thousand dollars are within the powers of the Director General.

The sum approved for feasibility studies amounted to 3.150 million dollars and used to finance 9 studies (6 studies in infrastructure sector, 2 studies in financial sector and one (1) study in agriculture and rural development sector).

Regarding the institutional support 26 operations were approved, at a total cost of 6.760 million dollars, including 4 regional and national training courses in the fields of investment, private sector development, agriculture and animal resources, at a total cost of 1.005 million dollars.

They also included provision of the services of 7 Arab experts in infrastructure and financial sectors, at a total cost of 2.020 million dollars, of which 35.30 thousand dollars were earmarked to increase the allocations of an Arab expert. This In addition to 12 different operations (seminars, forums and conferences) covering infrastructure, agriculture and rural development, industry and finance sectors, at a total cost of 2.835 million dollars, 2 operations for combating blindness amounting to 600 thousand dollars and one (1) operation to support the Arab Electronic Portal, amounting to 300 thousand dollars.

The distribution of the technical assistance commitments by sector during the year 2016, continued to reflect the priorities of the African beneficiary countries. Accordingly, 2.915 million dollars were allocated to infrastructure sector, 670 thousand dollars to agriculture and rural development sector, 4.920 million dollars to financial sector, 1.325 million dollars to social sector and 170 thousand dollars to industrial sector.

Technical Assistance Operations and their Sectoral Distribution (1975 – 2016)

Since the beginning of its financial activities in 1975 up to the end of 2016, BADEA has allocated an amount of 170.713 million dollars to finance 696 technical assistance operations. All the 44 countries eligible for BADEA’s aid benefited from those operations, along with six (6) regional groups and 17 regional institutions.

Total allocations for feasibility studies amounted to 75.767 million dollars (i.e. 44.38% of the total) while 94.946 million dollars (i.e. 55.62%) were allocated for institutional support (table IV).



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Urgent Aid: 12.635 (0.30%)

Social sector: 427.564 (10.19%)

Industry: 51.529 (1.23%)


Energy: 172.664 (4.12%)





Num

ber o

f Tra

inee

s

0

1000

2000

3000

4000

5000

18020162015201420132012201120101975-2009

806309

567

3355

335

4186

454

2016 - 1974

2005 - 1974

1995 - 1974

1985 - 1974

4,335.007

2,314.066 1,567.890

1,239.783 907,690

772.619 576.362

3,029.063

6,122.145

3,465.180

4,549.3

4.500

.000

4.000

.000

3.500

.000

3.000

.000

2.500

.000

2.000

.000

1.500

.000

1.000

.000

500.0

00

000.0

00

3,049.1

506.3

3,797.7

4,509.042

1,666.080

771.960

1,801.8801,584.090

0.000

1,000.000

2,000.000

3,000.000

4,000.000

5,000.000

6,000.000

7,000.000





Million $

94,946 Million $55,62%

75.767Million $44,38%


Operations% 64.56


Operations% 35.44

Million $




BADEAAfrican


World bankGroup

EuropeanUnion


and OFID

IndustrialCountries

.


local entities


General Reserve

Disbursements

Paid-Up Capital


Million $

Million $

Million $

Table IVEvolution of Technical Assistance Operations 1975 – 2016

DateFeasibility studies Institutional support Total

Number Amount($ Million) Number Amount

($ Million) Number Amount($ Million)

1975 - 2004 155 42.622 169 35.627 324 78.2492005 7 2.000 21 3.989 28 5.9892006 8 2.740 16 3.485 24 6.2252007 8 2.910 23 3.590 31 6.5002008 8 2.770 23 3.980 31 6.7502009 9 3.605 18 3.395 27 7.0002010 9 3.285 21 4.715 30 8.0002011 7 2.330 24 5.670 31 8.0002012 8 2.460 24 5.540 32 8.0002013 4 1.560 29 6.440 33 8.0002014 6 2.550 23 5.450 29 8.0002015 9 3.785 26 6.215 35 10.0002016 9 3.150 32 6.850 41 10.000Total 247 75.767 449 94.946 696 170.713*Percentage % 35.44 44.38 64.56 55.62 100 100

During 1975 – 2016, the infrastructure sector received the largest share of the allocations of 64.898 million dollars (38.02%), followed by agriculture and rural development sector at 59.946 million dollars (35.12%). Equally the financial departments in African countries received 34.594 million dollars, (20.26%), the industry sector received 5.678 million dollars (3.3%) and the energy sector received 5.597 million dollars (3.3%) (Table V).

* The net commitments of technical assistance amounted to 140.801 million dollars after deducting a sum of 27.893 million dollars rep-resents the value of cancelled grants and feasibility studies and a sum of 2.019 million dollars allocated to 8 feasibility studies, which resulted in projects co-financed by BADEA, cconsequently the sum considered as a part of the granted loans.

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Table VDistribution of Technical Assistance Operations by Sector

1975 - 2016 ($ Million)

Sector /

Technical Assistance

Infrastructure Agriculture Industrial Energy Finance Total

Amount % Amount % Amount % Amount % Amount % Amount %

Feasibility Studies 38.029 50.2 28.907 38.2 2.328 3 4.525 6 1.978 2.6 75.767 100.0

Institutional Support:Experts 10.181 37.5 7.778 28.5 0.560 2.1 0.235 0.9 8.409 31 27.163 100.0

Training 3.445 10.9 15.260 48.4 2.105 6.7 0.280 0.9 10.450 33.1 31.540 100.0

OtherOperations 13.243 36.5 8.001 22.1 0.685 1.9 0.557 1.5 13.757 38 36.243 100.0

Sub-Total 26.869 28.3 31.039 32.7 3.350 3.5 1.072 1.1 32.616 34.4 94.946 100.0

Grand Total 64.898 38.02 59.946 35.12 5.678 3.3 5.597 3.3 34.594 20.26 170.713 100.0

Feasibility StudiesBADEA accords importance to preparation of feasibility studies, which are assigned to Arab, African or Arab/African consulting firms and institutions. Studies related to infrastructure and agriculture and rural development sectors received the biggest share of the total feasibility studies’ budget (75.767 million dollars), absorbing 50.2% and 38.2% respectively, whereas energy, industrial and financial sectors received 6% 3% and 2.6% respectively.

Institutional SupportAllocations for institutional support amounting to 94.946 million dollars covered the following fields:

Provision of Services of Arab ExpertsProvision of services of Arab experts to African beneficiary countries has been playing a key role in transmitting knowledge and expertise to them and has contributed to training local cadres. The total number of experts approved for African countries during 1991 – 2016 stood at 132 experts, at a total cost of 27.163 million dollars, including 11 experts who were in service in 2016.

Training and Capacity BuildingBADEA’s support to training sessions has increased in number, in response to the rising needs for human resources development and institutional capacity building in both private and public sectors. This increased support helps the beneficiary countries in the implementation of their social and economic development programs. 244 training sessions were sponsored by BADEA during the period 1975 – 2016, covering all the sectors and benefiting 10192 African trainees, at a total cost of 31.540 million dollars. In 2016 alone, the number of trainees was 180, representing about 1.8% of the cumulative number of trainees.

To execute the training sessions, BADEA continued to make use of Arab and African training institutions, which would further strengthen Arab-African cooperation and lead to achieving BADEA’s objectives.



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Urgent Aid: 12.635 (0.30%)

Social sector: 427.564 (10.19%)

Industry: 51.529 (1.23%)


Energy: 172.664 (4.12%)





Num

ber o

f Tra

inee

s

0

1000

2000

3000

4000

5000

18020162015201420132012201120101975-2009

806309

567

3355

335

4186

454

2016 - 1974

2005 - 1974

1995 - 1974

1985 - 1974

4,335.007

2,314.066 1,567.890

1,239.783 907,690

772.619 576.362

3,029.063

6,122.145

3,465.180

4,549.3

4.500

.000

4.000

.000

3.500

.000

3.000

.000

2.500

.000

2.000

.000

1.500

.000

1.000

.000

500.0

00

000.0

00

3,049.1

506.3

3,797.7

4,509.042

1,666.080

771.960

1,801.8801,584.090

0.000

1,000.000

2,000.000

3,000.000

4,000.000

5,000.000

6,000.000

7,000.000





Million $

94,946 Million $55,62%

75.767Million $44,38%


Operations% 64.56


Operations% 35.44

Million $




BADEAAfrican


World bankGroup

EuropeanUnion


and OFID

IndustrialCountries

.


local entities


General Reserve

Disbursements

Paid-Up Capital


Million $

Million $

Million $

Other Operations

The institutional support operations included contribution to the organization of Arab-African trade fairs, in cooperation with the secretariats of the League of Arab States and the African Union. BADEA’s contribution in this regard included funding the cost of preparing stands for exhibition and covering expenses of logistics and transportation of exhibitors’ displays of African participants. It has already contributed to the organization of the seven Arab-African joint trade fairs, held so far.

Operations also included provision of office and medical equipment for some African institutions, financing forums for Arab and African consulting firms and for Arab and African Businesswomen, organizing meetings for chambers of commerce and industry in Africa and the Arab world, meetings for high-level experts in the field of food security and meetings for Arab and African experts on investment prospects in Africa, this in addition to 18 operations within the powers of the Director General. The total cost of this type of support stood at 36.243 million dollars.

Evolution of Commitments and Disbursement from Loans and Grants (1975 - 2016)

During the period 1975 - 2016 total commitments of loans and grants amounted to about 5,095.883 million dollars, of which 4,925.170 million dollars were committed for public and private sectors loans and 170.713 million dollars for technical assistance grants. Net commitments stood at 4,335.007 million dollars, of which 4,194.206 million dollars for loans and 140.801 million dollars for grants, excluding 59 loans granted by SAAFA, at a total cost of 214.244 million dollars.

The difference between the total gross and net commitments is 760.876 million dollars, representing cancellations during the period 1975 – 2016, some of which are unutilized balances of loans and grants of completed operations.

The total cumulative disbursement reached 3,029.063 million dollars at the end of 2016, of which 2,916.333 million dollars for public and private sectors loans and 112.730 million dollars for technical assistance grants, compared to 2,899.370 million dollars by the end of 2015, of which 2,795.083 million dollars for loans and 104.287 million dollars for grants, including disbursements out of SAAFA. The ratio of cumulative disbursement to cumulative commitments of both BADEA and SAAFA, net of cancellation, stood at about 67% by the end of 2016 (Table 6).

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w w w . b a d e a . o r g 29

Annual Report

It is worth noting that the volume of disbursement from loans during the last 10 years (2007 - 2016), has exceeded the volume of repayment of principal loans instalments by 795.700 million dollars. The disbursement amounted to 1,293.631 million dollars, whereas the repayment stood at 497.931 million dollars, and this is due to the improvement of loans and grants management and follow-up, and the increase in number of operations during the same period.

Regarding the disbursement and repayment in 2016, they amounted to 121.250 million dollars and 47.810 million dollars respectively.

5Graph

5Graph

4Graph

3Graph

2Graph

1Graph

Urgent Aid: 12.635 (0.30%)

Social sector: 427.564 (10.19%)

Industry: 51.529 (1.23%)


Energy: 172.664 (4.12%)





Num

ber o

f Tra

inee

s

0

1000

2000

3000

4000

5000

18020162015201420132012201120101975-2009

806309

567

3355

335

4186

454

2016 - 1974

2005 - 1974

1995 - 1974

1985 - 1974

4,335.007

2,314.066 1,567.890

1,239.783 907,690

772.619 576.362

3,029.063

6,122.145

3,465.180

4,549.3

4.500

.000

4.000

.000

3.500

.000

3.000

.000

2.500

.000

2.000

.000

1.500

.000

1.000

.000

500.0

00

000.0

00

3,049.1

506.3

3,797.7

4,509.042

1,666.080

771.960

1,801.8801,584.090

0.000

1,000.000

2,000.000

3,000.000

4,000.000

5,000.000

6,000.000

7,000.000





Million $

94,946 Million $55,62%

75.767Million $44,38%


Operations% 64.56


Operations% 35.44

Million $




BADEAAfrican


World bankGroup

EuropeanUnion


and OFID

IndustrialCountries

.


local entities


General Reserve

Disbursements

Paid-Up Capital


Million $

Million $

Million $



(1) This sum is the total cumulative of BADEA’s commitments before cancellations, of which 4,925.170 million dollars for loans and 170.713 million dollars for grants.

(2) This sum is the total cumulative of BADEA’s net commitments, of which 4,194.206 million dollars for loans and 140.801 million dollars for grants.

Table VIEvolution of BADEA’s Commitments and Disbursements (1974 - 2016) ($ Million)

Year Annual Financing

Annual Net Commitments

SAAFA AnnualCommitments

BADEA & SAAFA Cumulative Net Commitments

Total Cumulative of Disbursements

Disbursements as Percentage of Commitments (%)

1974 ـــ ـــ 79.850 79.850 79.850 1001975 85.500 68.033 64.650 212.533 144.500 681976 62.000 56.823 56.500 325.856 203.097 621977 66.290 64.226 13.244 403.326 223.959 561978 72.870 48.601 ـــ 451.927 279.635 621979 49.070 41.916 ـــ 493.843 331.591 671980 71.950 48.066 ـــ 541.909 379.446 701981 76.026 41.284 ـــ 583.193 416.428 711982 90.000 48.180 ـــ 631.373 453.240 711983 83.938 62.120 ـــ 693.493 492.894 711984 87.960 43.178 ـــ 736.671 534.798 731985 73.790 35.785 ـــ 772.456 576.362 751986 58.605 36.937 ـــ 809.393 625.576 771987 71.423 28.604 ـــ 837.997 660.747 791988 66.720 49.151 ـــ 887.148 685.596 771989 72.000 53.618 ـــ 940.766 709.227 751990 73.682 32.565 ـــ 973.331 732.516 751991 74.235 34.613 ـــ 1,007.944 775.346 771992 73.726 54.157 ـــ 1,062.101 810.739 761993 74.654 48.521 ـــ 1,110.622 833.536 751994 74.307 55.998 ـــ 1,166.620 868.811 741995 79.930 73.000 ـــ 1,239.620 907.690 731996 89.938 78.467 ـــ 1,318.087 950.177 721997 99.830 76.536 ـــ 1,394.623 992.886 711998 109.940 69.535 ـــ 1,464.158 1,042.612 711999 119.520 95.700 ـــ 1,559.858 1,113.937 712000 123.950 115.789 ـــ 1,675.647 1,170.766 702001 129.200 101.292 ـــ 1,776.939 1,238.822 702002 134.390 132.150 ـــ 1,909.089 1,309.097 692003 139.990 120.980 ـــ 2,030.069 1,386.819 682004 144.970 138.906 ـــ 2,168.975 1,477.208 682005 159.939 143.305 ـــ 2,312.280 1,567.890 682006 169.945 155.258 ـــ 2,467.538 1,677.291 682007 179.600 175.956 ـــ 2,643.494 1,825.125 692008 190.000 179.008 ـــ 2,822.502 1,965.984 702009 200.000 188.740 ـــ 3,011.242 2,098.924 702010 200.000 198.214 ـــ 3,209.456 2,223.603 692011 200.000 199.146 ـــ 3,408.602 2,360.060 692012 200.000 187.582 ـــ 3,596.184 2,483.329 692013 200.000 187.654 ـــ 3,783.838 2,619.092 692014 200.000 199.576 ـــ 3,983.414 2,753.610 692015 260.000 259.909 4,243.323 2,899.371 682016 306.000 305.928 - 4,549.251 3,029.063 67Total 5,095.883 (1) 4,335.007 214.244 (2) 4,549.251 3.029.063

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Annual Report

Projects and Technical Assistance Operations Completed during 2016During 2016, 26 development projects were completed in infrastructure sector (transport, potable water supply and sewerage), in agriculture and rural development sector (agriculture, rural water, rural development and rural electricity) and in social sector (education), at a total cost of 190 million dollars. These operations benefited 19 African countries, to contribute to the improvement of their living standard, alleviating poverty and creating job opportunities. Also 27 technical assistance operations were completed, included 4 feasibility studies and 23 institutional support operations (training courses and provision of the services of Arab experts), at a total cost of 5.967 million dollars.

Signature of Loan Agreements During the year 2016, 19 loan agreements were signed with 12 African countries and 7 regional institutions. Total amount of loans extended by virtue of these agreements stood at 281 million dollars. Equally, 11 agreements have been declared effective with 8 African countries and 3 regional institutions, at a total cost of 161.6 million dollars.

BADEA’s Contribution towards Debt Relief

Within the framework of its Five-Year Plans, BADEA proactively contributed to the debt relief in favor of some African countries; even before the International Monetary Fund and the World Bank launched their Heavily Indebted Poor Countries (HIPC) Initiative.

BADEA’s contribution in this respect has been in the form of extending loans with concessional terms and facilitating the repayment of arrears to tackle the issue of indebtedness.

BADEA joined the other international financial institutions in applying HIPC terms since 1997. Later, it adopted the Multilateral Debt Relief Initiative (MDRI), in close coordination with other partners, contributing its agreed share of debt relief for eligible countries on a case by case basis.

Up to the end of 2016, BADEA’s total debt relief under the HIPC Initiative amounted to 258.848 million dollars, for the benefit of 29 African countries, as shown in the following table:

Country Amountin $ Million Country Amount

in $ MillionUganda 7.200 Malawi 4.216Mozambique 11.300 Sierra Leone 9.766Benin 2.600 Sao Tome & Principe 7.011Mali 4.041 Burundi 15.808Senegal 5.100 The Gambia 0.817Burkina Faso 16.300 Central Africa Republic 8.726Niger 19.600 Congo 5.180Ethiopia 6.000 Guinea Bissau 7.185Tanzania 14.742 Democratic Congo 17.906Rwanda 24.312 Liberia 17.270 Ghana 8.342 Togo 0.308Madagascar 1.506 Cote d’Ivoire 1.771Zambia 11.847 Guinea 10.360Cameroon 1.904 Comoros 15.446Chad 2.284Total Cost 258.848 million dollars



BADEA provides assistance to each of African countries eligible for benefiting from the Initiative which reached to the Completion Point. Such debt relief to those countries will help them to meet their debt repayment obligations.

BADEA’s Financing and Poverty Reduction

One of the main objectives of BADEA’s interventions in all sectors, is to contribute to poverty reduction, so priority is given to development operations that lead directly or indirectly to poverty reduction.

As poverty is concentrated in rural and agricultural sectors in the most parts of the African Continent, BADEA focuses on financing infrastructure projects, which help in creating suitable environment for investment, increasing production in agriculture and rural development sector and supporting its infrastructures in the fields of: rural roads, rural electricity, potable water, health and education, in addition to provide job opportunities, to enable the poor segments in the society to increase their income and improve their living conditions.

BADEA also aims at reinforcing women’s role, in general, and rural women, in particular; due to the expected impact on poverty reduction. It also seeks to improve rural sector through the conservation of environment.

Loans allocated for financing projects aiming at poverty alleviation, are provided on soft terms, taking into account the flexibility in financing the components of projects in local currency.

Co-financing

During 2016, BADEA co-financed 13 projects, out of the 16 approved projects, with Arab financing institutions and the OFID. The percentage of its financing in relation to the total cost of these projects, amounting to 686.83 million dollars, stood at 26.2%. The contribution of other Arab funds (Saudi Fund for Development, Kuwait Fund for Arab Economic Development and Abu Dhabi Fund for Development) and OFID amounted to about 64.6%. So BADEA’s financing when added to that of other Arab funds and OFID stood at about 90.8%, while the beneficiary countries and local entities contributed about 9.2%.

As for the remaining 3 projects, BADEA co-financed them with the beneficiary countries and local entities, at a total cost of 36.61 million dollars. Its contribution to the said projects amounted to 30 million dollars, representing 81.9% of their total cost. (Table VII).

Table VIICo-financing During 2015 & 2016

Co financiers2015 2016

$ Million % $ Million %

BADEA 159.60 24.92 180.00 26.2

Arab Funds, IslamicDevelopment Bank and OFID 394.60 61.62 443.62 64.6

Non-Arab Financing Institutions - - - -

Beneficiary Countries & Local Entities 86.222 13.46 63.21 9.2

Total 640.422 100.00 686.83 100.00

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Annual Report

The total cost of projects co-financed by BADEA with all the institutions, during the period 1975 – 2016, amounted to 19,925.387 million dollars (Table VIII). BADEA’s contribution represented about 17.40%, while the contribution of other Arab Funds, the Islamic Development Bank and OFID jointly stood at 30.73%, hence the contribution of Arab financing, the Islamic Development Bank and OFID represented 48.13%.

Other sources of financing, which include: The World Bank Group, the African Development Bank Group, Industrialised Country Governments, the European Union, the International Fund for Agricultural Development (IFAD), the West African Development Bank, the Central African Development Bank and ECOWAS Bank for Investment and Development, jointly, contributed 29.22%, while the contribution of beneficiary countries and local entities stood at 22.65%.

TableVIIICo-financing During 1975 - 2016

$ Million %Total cost of projects 19,925.387 100

Finance

1. BADEA 3,465.180 17.40

2. Arab Funds, Islamic Development Bank & OFID 6,122.505 30.73

3. World Bank Group 1,584.090 7.95

4. African Development Bank & Regional African Institutions* 1,801.880 9.04

5. European Union 771.960 3.87

6. Industrial Countries 1,666.080 8.36

7. Beneficiary Countries & Local Entities 4,513.692 22.65

Coordination with Development Financing Institutions

Since the beginning of its operations, BADEA has being keen on cooperating with development finance institutions, especially the Arab ones, for its positive and effective role in financing economic and social development projects, for the benefit of developing countries.

BADEA has participated in the periodic meetings of these institutions, to ensure continued coordination with them and exchange of experiences and views on all emerging issues in the field of development aid. Hence, it participated in the meetings of: IFAD Board of Governors in Rome in February 2016, the High-level Meeting of Arab Coordination Group with the Development Assistance Committee (DAC) and the Organization for Economic Cooperation and Development (OECD) in Vienna in March 2016, the annual Spring Meetings of the World Bank and the International Monetary Fund in Washington in April 2016, the meetings of the Coordination Group in Vienna in May 2016 and in Kuwait in October 2016, the annual meetings of the World Bank and the International Monetary Fund in Washington in October 2016, in addition to many donor meetings of the projects it co-finances.



These meetings availed opportunities to meet with sister financial institutions, other international organizations and African delegations and to follow-up with them projects implementation and agree on future work programs.

On the other hand, many delegations - at all official levels - visited BADEA’s Headquarters at Khartoum, to discuss the current cooperation and means of enhancing it, while missions from BADEA visited several African countries, to follow up the development operations in progress and to identify new ones valid for financing.

Cooperation with Arab and African Regional Organizations

Within the framework of cooperation with Arab and African regional organizations, BADEA participated in many meetings and activities during 2016.

- From 27 to 31 January, BADEA participated in “the 26th Session of the African Union Summit” held in Addis Ababa, and met, on its sidelines, With the United Nations Economic Commission for Africa (UNECA) departments, to discuss a project of signing a memorandum of understanding. On the 1st of February - during the same occasion, it attended “the Second Meeting of the Interim Executive Council of the Arab African Cultural Institute”.

- From 14 to 18 February BADEA participated in “the 97th Session of the Economic and Social Council of the League of Arab States”, which was held in Cairo.

- Pursuant to the Reslution of the Third Arab-African Summit to rationalize the mechanisms for the implementation and follow-up of the Arab-African Partnership, BADEA attended “the Consultative Meeting to Rationalize Mechanisms for the Implementation and Follow-up of the Arab-African Partnership” in Cairo from 23 to 25 February, in which senior officials from the AU Commission, the Secretariat of LAS, the Arab African Cultural Institute and the Technical Assistance Fund for African States participated. The meeting assigned BADEA to finance a study to evaluate the Arab-African Partnership during the period 2011 - 2016.

- In the framework of the Fourth Arab African Summit in Malabo, Republic of Equatorial Guinea, BADEA took part in the first preparatory meeting of this Summit, held in Cairo on 28th of February.The Meeting ensured that an issue reflecting the priorities of Arab and African regions should be presented. It also proposed holding of a seminar and organizing Arab – African book exhibition, within the framework of the Summit.

- A delegation from BADEA visited Addis Ababa from 13 to 18 March, to participate in the preparation of the side event for signing a memorandum of understanding between BADEA and the United Nations Economic Commission for Africa (ECA). Administrative and financial arrangements for holding of the event were discussed as well as agreement on its agenda.

- During the period from 31 March to 5 April, a mission attended in Addis Ababa “the 9th Session of the Conference of African Finance Ministers”. On the margin of the Session it met with the Chairperson of the African Union Commission, the Finance Minister of the Republic of The Gambia and the Chairman of the delegation of the Republic of Equatorial Guinea, and reviewed with them the current cooperation relations and means of their strengthening.

The mission also participated in a side event on “the Seventh Report” to evaluate the regional integration in Africa, where the Director General of BADEA offered a presentation about the regional integration in Africa .It also attended two side events on “the Blue Economy” and “Macroeconomics”.

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Annual Report

- From 9 to 11 August, a delegation participated in “The Preparatory Meetings for the Fourth Arab-African Summit”, which was held at the Headquarters of the General Secretariat of LAS in Cairo, with representatives of the League and the Permanent Mission of the AU to LAS.

In addition the delegation to attended the “3rd Meeting of the Preparatory Committee for the Fourth Arab-African Summit” and the “10th Meeting of the Arab-African Partnership Committee” held in Malabo, from 5 to 7 September.

The first meeting discussed the logistics of the Summit and some reports. The second meeting adopted “Malabo Declaration Project”, “Joint Action Plan Project 2017 - 2 019”, “ Palestine Declaration Project” and reviewed the results of the study on the “Disaster Management Fund” financed by BADEA.

- In Addis Ababa, BADEA participated in the “6th Meeting of the Steering Committee of Arab-African Plan of Action for Agricultural Development and Food Security” from 28 to 30 September. The meeting adopted agricultural development and food security projects for the period 2017 – 2019 and discussed the action plan of Arab-African Joint Program for Agricultural Development and Food Security, during the same period.

- Equally BADEA participated in the“the 3rd Preparatory Meeting of Arab-African Economic Forum” on October 1st 2016, where discussions included the Forum issues, agenda and documents.

Countries benefiting from public sector projectsand technical assistance during 2016

Ethiopia

Chad

Gabon

Zambia

Tanzania

Cote d’IvoireKenya

LiberiaM

adag

asca

r

Central African Republic

NigerMali

Burkina FasoSenegal

Guinea

Ugan

daMoz

ambi

que

Swaziland

Seychelles

Agriculture and Rural Development

RoadsHealth

Education

Feasibility Studies

Institutional supportTechnical

Assistance

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Annual Report

Part Two Detailed Description

of the Appoved Operations in 2016

BADEA approved during 2016 the financing of 16 development projects in the public sector, 8 projects in the private sector, 10 operations of Arab exports and 41 technical assistance operations, for the benefit of the African countries eligible for its assistance. The following is a detailed description of these operations, ordered according to the date of approval by the board of Directors of BADEA:

(A) Public Sector Projects

Construction of Small Dams for Agriculture and Livestock in Rural Areas

Sector: Agriculture and Rural Development

Republic of Chad

Annualinterest rate

Graceperiod

Repaymentperiod

Loanduration

Date ofapproval

Loan amount($ million)

Project cost($ million)

1%10 years20 years30 years3/3/20162050

Project ObjectivesThe project aims at contributing to the achievement of food security in rural areas, through providing surface water for agriculture and animal resources. It also aims at realizing the sustainable development of natural resources and the adaptation of agricultural activities and animal husbandry to climate change. The project will contribute to the provision of food, improvement of agricultural production, enhancement of income generating animal production and the alleviation of poverty.

Project DescriptionThe project is situated in three provinces: “Djira”, “Ouaddai” and “Wadi Fira”, in a total area of 143 thousand square kilometers. It comprises building of 14 small dams, digging of 30 artesian wells for irrigation, 30 wells for providing water for livestock, in addition to reclamation of 900 hectares of irrigated lands, 200 hectares of rain-fed agricultural lands, 30 hectares of women farms, and building about 60 kilometers of rural gravel roads. The project also comprises erecting 15 storage facilities for inputs, 15 village slaughterhouses, 15 insemination pens for livestock and 3 cattle markets, in addition to support for farmers and herders in the project area, through awareness and training campaigns and the provision of micro-credits.

Project FinancingThe project contributors include: BADEA with 20 million dollars (representing 40% of the total cost), the Saudi Fund with 25 million dollars (representing 50% of the total cost), and the Government with 5 million dollars (representing 10% of the total cost).



Construction of Cancer Treatment Centers

Sector: Social Sector (Health)

Republic of Zambia

Annualinterest rate

Graceperiod

Repaymentperiod

Loanduration

Date ofapproval




Project ObjectivesThe project aims at supporting the Government’s policy of scaling up and enhancing the coverage of health services, responding to the basic needs of the population and improving their health situation.

The project also aims, specifically, at providing treatment to cancer patients, reduce the financial burden on them, shorten the travel and waiting time as well as alleviate the hardship and cost of travelling to the capital Lusaka or abroad to receive treatment.

Project DescriptionThe project covers three locations: Central Hospital in Lusaka, Livingston city in the South Region and Ndola city in Copper Belt Region in the North.

The project comprises civil engineering works to expand the existing Cancer Treatment Center in the Central Hospital in Lusaka, by adding a Linear Accelerator unit and constructing a Cancer Treatment Center in Livingston and another in Ndola, each of a total surface area of 2000 square meters.

It also includes procurement of medical equipment and furnishings, training of medical and technical staff, organizing awareness raising campaigns and providing consultative services and institutional support.

Project FinancingBADEA’s contribution: 10 million dollars (representing 40% of the total cost), OFID:12.40 million dollars (49.6%), and the Government: 2.60 million dollars (10.4%).

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Annual Report

Supply of Drinking Water to the Islands of Lower Casamance


Republic of Senegal

Annualinterest rate

Graceperiod

Repaymentperiod

Loanduration

Date ofapproval



1%10 years20 years30 years3/3/2016910.5

Project Objectives The project aims at responding to the needs for safe drinking water to the population of lower islands in the Delta of the Casamance River, as well as improvement of their health conditions through reducing the prevalence of water-borne diseases and alleviating poverty, contributing thus to the stability of the population and improvement of the living conditions in general.

Project DescriptionThe project is situated in the Delta of the Casamance River south of the capital Dakar. It comprises construction of 5 drinking water supply networks to supply 30 villages, through digging and preparing 10 pipe wells, complete with the necessary pumps and other accessories, procuring and installing 5 electric generators, 2 powered by diesel and 3 solar powered, constructing 11 elevated water storage tanks of capacities ranging from 25 to 200 cubic meters, laying a 142 kilometers pipe network for water distribution, with a radius ranging from 75 to 200 millimeters, and procuring and installing 250 public water distribution points.

The project components include also consultancy services and support of capacities and of the two projects Management and Implementation Units.

Project FinancingBADEA’s contribution: 9 million dollars (representing 85.7% of the total cost), and the Government: 1.5 million dollars (14.3% of the total cost).



Construction and Equipping of a Regional Hospital in Yopougon

Sector: Social (Health)

Republic of Côte D’Ivoire

Annualinterest rate

Graceperiod

Repaymentperiod

Loanduration

Date ofapproval




Project Objectives The project is part of the National Health Sector Development Plan (2012 -2015) which aims at providing and upgrading medical services to the population equitably, as well as providing medical services for the inhabitants of Yopougon, Jacqueville, Sikinsi and Dabu areas who number about 3.5 million and who face serious shortages in medical services, particularly treatment of kidney diseases.

Project DescriptionThe project is situated in Yopougon Municipality, west of the capital Abidjan which is the most densely populated in the country, with a population of about 2 million inhabitants.

The project comprises of the construction of a main building of three stories (housing medical sections, including renal disorders section and the hospital administration), and several wings (including the laboratory, pharmacy, radiology, a laundry and a cafeteria), on a total area of about 12600 square meters.

It also comprises of the construction of 3 residential units on an area of about 400 square meters, provision of equipment such as elevators, a generator, medical and non-medical furniture and vehicles, in addition to consultancy services, land acquisition and support of the Project Implementation Unit.

Project FinancingBADEA’s contribution: 12 million dollars (representing 39.34% of the total cost), the Saudi Fund: 15 million dollars (49.18%) and the Government: 3.5 million dollars (11.48%).

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Annual Report

Supply of Electricity to Some Villages through Hybrid Solar


Republic of Mali

Annual interest rate

Grace period

Repayment period

Loanduration

Date of approval




Project ObjectivesThe project aims at provision of electricity for household uses, health and educational services centers and commercial and agricultural activities in some villages, in order to improve the lives of rural population and their living conditions, develop the local economy and alleviate poverty.

The project falls within the context of the Government program for electricity generation for 80% of the country’s population by 2020 as compared to 17% at present.

Project DescriptionThe project is situated in 5 areas: Sikaso, Sigu, Kayis, Kolikori and Mobti and covers 32 villages.

Phase One of the project comprises expansion of the hybrid solar electric energy generating stations and the existing distribution networks in 10 villages.

Phase Two includes building solar energy electricity generation stations and distribution networks in 22 villages. The project further includes consultancy services and the measures necessary for environmental protection, in addition to support for the Project Implementation Unit and training the technicians of Mali Agency for Development of Household Energy and Rural Electrification.

Project FinancingContributors to the financing of the project (Phase 1) are: Abu Dhabi Fund: 6.107 million dollars (representing 85.01% of the total cost of 7.184 million dollars), the Government: 0.718 (9.99%) and the Operator “Access”: 0.359 million dollars (5%).

Contributors to Phase 2 are: BADEA: 10 million dollars (representing 69.81% of the total cost of 14.326 million dollars), Abu Dhabi Fund: 2.893 million dollars (20.19%) and the Government: 1.433 million dollars (10%).



Upgrading of Gbarnga – Salayea Road

Sector: Infrastructure and Environment

Republic of Liberia


Grace period

Repayment period

Loanduration

Date of approval




Project Objectives The project falls in the context of the Government’s program for development of the road network, and the improvement of land transport which plays a central role in the support of economic growth and poverty alleviation.The project aims at improving, widening and rehabilitating one of the main roads that were built during the previous decades and never maintained. It will contribute in reducing the time and cost of transport and facilitate access to social and administrative centers to travelers.

Project DescriptionThe project is located in the North-East of the country and links Gbarnga and Salayea towns. Its components include civil engineering works for the rehabilitation and development of the existing gravel road into an asphalt one, with a length of 81 kilometers and a width of 7.5 meters and two shoulders of 1.5 meters each, in addition to consultancy services, land acquisition and support of the Project Implementation Unit.

Project FinancingBADEA’s contribution: 12 million dollars (representing 12.62% of the total cost), OFID: 20 million dollars (21.03%), Saudi Fund: 20 million dollars (21.03%), Kuwait Fund: 15.5 million dollars (16.30%), Abu Dhabi Fund: 15 million dollars (15.77%) and the Government: 12.60 million dollars (13.25%).

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Annual Report

Upgrading of Gilgil - Machinery Road


Republic of Kenya


Grace period

Repayment period

Loanduration

Date of approval




Project Objectives The project aims at contributing to develop, expand and integrate the national road network, and linking the central and eastern parts of Niandarwa and Naivasha provinces with the rest of the country and with the capital Nairobi. The project contributes to the improvement of the traffic effectiveness, reducing the time and cost of transport and vehicles’ operations, in order to facilitate transport of agricultural products from the project area to other parts of the country and access to services, in addition to contribute to supporting the economic and social development.

Project DescriptionThe project comprises civil engineering works to develop the existing gravel road into an asphalt one, with a length of 22.7 kilometers and a width of 6.5 meters as well as two shoulders of 1.5 meters each. The project includes also the provision of consultancy services.

Project FinancingBADEA’s contribution: 11 million dollars (representing 73.33% of the total cost), and the Government: 4 million dollars (26.67% of the total cost).



Construction of Geology Department and Administration Buildings for the Faculty of Science in the University of Eduardo Mondlane

Sector: Social (Education)

Republic of Mozambique


Grace period

Repayment period

Loanduration

Date of approval




Project Objectives The project falls in the context of the Government’s plan to develop and expand the basic infrastructure for higher education in the country, including the expansion of buildings of Eduardo Mondlane University in Maputo. This will assist in increasing the intake in the Geology Department, improve teaching and training and create an atmosphere conducing to learning.

Project DescriptionThe project is located inside the campus of Eduardo Mondlane University, close to the Faculty of Science which BADEA helped in its expanding and equipping. The project comprises the construction of two buildings for the Geology Department with a total area of about 4062 square meters, an administrative building for the Faculty of Science with an area of about 2454 square meters and landscaping of a total area of 5000 square meters. The project also includes procurement of furniture, laboratory and office equipment, as well as consultancy services.

Project FinancingBADEA’s contribution: 10 million dollars (representing 90% of the total cost) and the Government: 1.11 million dollars (representing 10% of the total cost).

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Annual Report

Upgrading of Luwero - Butalangu Road


Republic of Uganda


Grace period

Repayment period

Loanduration

Date of approval



1%10 years30 years40 years3/3/201611.5024.65

Project Objectives The project aims at linking the central-eastern regions of Luwero and Naksaki with the capital Kampala and the other parts of the country, as well as improving the effectiveness of traffic and road safety, ensuring secure access of people to social services centers and reducing the time and cost of travel and vehicles operation.

Project DescriptionThe project is located in the central-eastern region of the country and it links Luwero and Butalangu towns.

The project comprises of civil engineering works that include developing the road to an asphalt one, with a length of 92 kilometers, a width of 7 meters and two shoulders each of 1.5 meters wide outside the residential areas, and 2 meters inside these areas. It also comprises the consultancy services, land acquisition and support to the Project Implementation Unit.

Project FinancingBADEA’s contribution: 11.50 million dollars (representing 46.65% of the total cost), OFID: 11.50 million dollars (46.65%) and the Government: 1.65 million dollars (6.70%).



Upgrading of Hamusit - Estie Road


Federal Democratic Republic of Ethiopia


Grace period

Repayment period

Loan duration

Date of approval




Project Objectives The project aims at contribution to the development, expansion and integration of the national road network, and linking the Amhara Region with the capital Addis Ababa, as well as improving traffic efficiency, reducing transport time and cost of vehicles’ operation, thus facilitating transport of agricultural products from the project area to other regions of the country, ensuring access of the population to the centers of social services and supporting the economic and social development.

Project DescriptionThe project is situated in the North-West of the country in Dira and East Estie districts in the Amhara Region, at about 595 kilometers to the North-West of the capital Addis Ababa.

The project components include civil engineering works to upgrade the existing gravel road to an asphalt road of a total length of 76.8 kilometers, a width of 7 meters and two shoulders of 1.5 meters each, in addition to consultancy services and land acquisition.

Project FinancingBADEA’s contribution: 15 million dollars (representing 34.10% of the total cost), OFID: 20 million dollars (45.45%) and the Government: 9 million dollars (20.45%).

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Annual Report

Rehabilitation and Expansion of “Mnazi Mmoja Hospital” in Zanzibar


United Republic of Tanzania


Grace period

Repayment period

Loanduration

Date of approval



1%10 years20 years30 years3/6/201610.5043.20

Project Objectives The project aims at expanding, developing and improving the level of treatment services in “Mnazi Mmoja” Reference Hospital, and provide them to patients who come to the hospital or are referred to it from other hospitals in Unjuja and Pemba Islands, whose numbers are increasing every year. It also aims at providing health services that are not available in Zanzibar with a view to reducing the cost incurred by the patients’ travel abroad or going to private hospitals in the mainland.

Project DescriptionThe hospital is situated in the middle of Stone Town on the west coast of Unjuja Island, and is composed of three units in different locations: the main hospital (Mnazi Mmoja), the Psychiatric Unit (Kidungo Shikundo) and the Obstetrics/Gynecology Unit (Moyemblado).The project comprises rehabilitation of the existing buildings and facilities in the three units, construction of new buildings in a total area of 8481 square meters and the addition of 304 new beds, in addition to procurement and installation of electrical and mechanical equipment, provision of medical and non-medical equipment and furniture, consultancy services and support of the Project Implementation Unit and auditing its accounts.

Project FinancingBADEA’s contribution: 10.50 million dollars (representing 24.31% of the total cost), the Saudi Fund: 15 million dollars (34.72%), the Kuwait Fund: 14 million dollars (32.41%) and the Government: 3.7 million dollars (8.56%).



Construction and Equipping of the National Specialized Hospital


Kingdom of Swaziland


Grace period

Repayment period

Loan duration

Date of approval




Project Objectives The project aims at providing comprehensive and advanced specialized medical care services to respond to the demand for such services in the Kingdom, as well as reducing the cases referred to treatment outside the country.

The project is accorded priority in the Second National Health Sector Strategy (2014 – 2018) which aims at providing comprehensive health coverage for all the population of Swaziland.

Project DescriptionThe project comprises of the constructing and equipping of a new specialized hospital in a plot of a total area of 29.5 thousand square meters, in two stories of a total area of 60 thousand square meters. It comprises the hospital buildings, an outpatient unit, residence for 20 physicians and nurses, in addition to buildings for other services.

The project further comprises the provision of furniture, medical equipment, the preparation of a study on the management and operation of the hospital, in addition to provision of consultancy services and supporting of the Project Implementation Unit.

Project FinancingBADEA’s contribution: 10 million dollars (representing 19.61% of the total cost), the Saudi Fund: 10 million dollars (19.61%), the Kuwait Fund: 15 million dollars (29.41%), OFID: 14 million dollars (27.45%) and the Government: 2 million dollars (3.92%).

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Annual Report

Rural Development in Some Areas


Republic of Guinea


Grace period

Repayment period

Loan duration

Date of approval




Project ObjectivesThe project aims at increasing agricultural productivity and improving its quality, contributing to support vegetable and fruit markets, improving producers’ income, promoting agricultural exports and exploitation of the natural resources, in addition to poverty alleviation in rural areas.

Project DescriptionThe project is situated in four areas: Kindia in Maritime Guinea Region, Mamu in Central Guinea Region, Faranah and Kankan in Upper Guinea Region, where agriculture is the main economic activity of the population of these regions.

The project comprises of: reclamation of 1015 hectares of irrigated land, constructing of 350 kilometers of rural gravel roads, and provision of drinking water, through digging 400 pipe wells and 43 water supply micro systems. The project also comprises supporting agricultural production, through provision of inputs to produce vegetables in an area of 925 hectares, establishing nurseries for fruit trees to be planted in an area of 780 hectares, extension services, awareness raising and training activities as well as supporting the Project Implementation Unit and auditing its accounts.

Project FinancingBADEA’s contribution: 20 million dollars (representing 45.45% of the total cost), OFID: 20 million dollars (45.45%) and the Government: 4 million dollars (9.1%).



Kwala – Nara – Mauritania Borders Road / First Phase: Kwala -Nara


Republic of Mali


Grace period

Repayment period

Loan duration

Date of approval




Project Objectives The project aims at improving the road network and contributing to enhancing trade exchanges between the Republic of Mali and the Islamic Republic of Mauritania, reducing transport time and cost and improving road safety, in order to develop transport between the two capitals, Bamako and Nouakchott, and market products in the main cities of West Africa.

Project DescriptionThe project is situated in Kolikoro in North-West of the Second Region of Mali and has an economic impact and coverage to Kai and Bamako regions and Nima region in Mauritania, and traverses four main cities and 20 large villages.The First Phase of the project comprises construction and asphalting Kwala- Nara road which is 188.3 kilometers long, with a width of 7 meters, two shoulders of 1.5 meters and two pavements of 2 meters wide each inside towns. It comprises also consultancy services, support of the Project Implementation Unit and audit of its accounts, as well as organizing a workshop to start implementation and be acquainted with the donors procedures.

Project FinancingBADEA’s contribution: 10 million dollars (representing 7.59% of the total cost), Islamic Development Bank: 92.26 million dollars (70.01%), the Saudi Fund: 15 million dollars (11.38%), OFID: 10.40 million dollars (7.89%) and the Government: 4.12 million dollars (3.13%).

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Annual Report

Construction of Wahigoya – Djibo Road


Burkina Faso


Grace period

Repayment period

Loan duration

Date of approval




Project Objectives This project falls within the overall policy of the Government to end the country’s internal and external isolation (as Burkina Faso is landlocked), to ensure the fluidity of traffic around the year and contribute to intensification and growth of trade exchanges between the project area and other parts of the country, on the one hand, and between the different provinces of the country and neighboring countries (Mali and Niger), on the other. It aims also at reducing transport time and cost and contributing to alleviation of poverty.

Project DescriptionThe project is situated in the North and Sahel regions of Burkina Faso, 200 kilometers north of the capital Ouagadougou, and is a sector of the National Highway (23) which links Burkina Faso and Niamey, capital of Niger. It comprises constructing of a 115 kilometers long road, with a width of 7 meters and two shoulders of 1.5 meters each, as well as preparing 5 kilometers of internal roads in Djibo city, in addition to consultancy services, support of the Project Implementation Unit and audit of its accounts.

Project FinancingBADEA’s contribution: 19 million dollars (representing 23.24% of the total cost), the Kuwait Fund: 23.80 million dollars (29.11%), the Saudi Fund: 15 million dollars (18.35%), OFID: 15 million dollars (18.35%) and the Government: 8.96 million dollars (10.95%).



Construction of Filingue – Tahoua Road / Section: Inkarkadan - Tahoua


Republic of Niger


Grace period

Repayment period

Loanduration

Date of approval




Project Objectives This project falls within the overall policy of the Government to end the country’s internal and external isolation as Niger is landlocked.

The project aims at developing the transport sector, upgrading of the national regional road network that links Niger to other neighboring countries and contributing to strengthening trade exchanges between the countries of North Africa and the Sub-Saharan African countries (Mali, Niger, Burkina Faso, Chad and Nigeria). It also aims at contributing to the economic and social development of its area and to poverty alleviation.

Project DescriptionThe project is situated in Dosso and Tahoua Provinces North-East of the capital Niamey and it is an important part of the Regional Highway (16) which represents a sector of the main road network (Ouagadougou - Niamey - Dosso - Tahoua) of the Economic Community of West African States (ECOWAS).

The sector Inkarkadan – Tahoua of the project comprises constructing of a 52 kilometers long road with a width of 7 meters and two shoulders of 1.75 meters outside the residential areas and 2.75 meters inside them, in addition to preparation of 3 kilometers of internal roads in Tahoua town. It also comprises consultancy services, the accompanying works, support of the Project Implementation Unit and audit of its accounts.

Project FinancingBADEA’s contribution: 20 million dollars (representing 45.12% of the total cost), the Kuwait Fund: 20.40 million dollars (46.02%) and the Government: 3.93 million dollars (8.86%).

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Annual Report

(B) Private Sector Projects and Foreign Trade Operations

Loan of Credit to the Development Bank of Rwanda

Sector: Private

Republic of Rwanda

Project Objectives:

The loan of credit aims to provide financial resources on the medium term, enabling the Bank to contribute in funding the development projects expected to be implemented during the period 2016 – 2020. The Bank already launched implementation of its operational strategy (2015 – 2019) which aims at supporting the developmental efforts of Rwanda, focusing on energy, housing, education and agriculture sectors. Developing these critical sectors is expected to liberate the economic production energies, increase income, create employment opportunities, as well as raising growth rates of economic and human development.

Project Financing:

The loan of credit provided by BADEA to the Development Bank of Rwanda is 15 million dollars.

Date of Approval: 03 June, 2016

Loan of Credit to the SONIBANK

Sector: Private

Republic of Niger

Project Objectives:

The loan of credit aims at providing financial resources at the medium term, enabling the Bank to contribute to funding of development projects, expected to be implemented in the country in the period 2016 – 2020, most of which are private sector projects.

The loan will provide capital resources needed by the country. Financing investment expenditures and working capital will enable investors to expand and develop the existing productive capacities.

Project Financing:

The loan of credit provided by BADEA to the SONIBANK is 5 million dollars.


Loan of Credit to the Eastern and Southern African Trade and Development Bank (PTA Bank)

Sector: Private

Regional

Project Objectives:

The loan of credit aims at funding the private sector operations through the Bank, for the 14 countries of COMESA eligible for BADEA’s assistance which are: Burundi, Democratic Congo, Eritrea, Kenya, Malawi, Mauritius, Rwanda, Seychelles, Tanzania, Uganda, Zambia, Zimbabwe, Ethiopia and Madagascar.

The loan responds to the need of these countries for additional capital resources that contribute to activating the real economy, with a substantial impact in supporting their economic situations.

Project Financing:

The loan of credit provided by BADEA to the PTA Bank is 15 million dollars.


Loan of Credit to Central African States Development Bank (BDEAC)

Sector: Private

Regional

Project Objectives: The loan of credit aims at contributing in financing the private sector in the countries of the Economic and Monetary Community of Central Africa States (Cameroon, Central African Republic, Congo, Gabon, Chad and Equatorial Guinea), through The Economic Development Bank of the Central African States, by providing suitable funding for projects in the different economic sectors in these countries, particularly in agriculture, agro-based industry, fisheries and industry. This will contribute to the achievement of sustainable development, create job opportunities, improve living conditions and alleviate poverty.

Project Financing:

The loan of credit provided by BADEA to the BDEAC is 15 million dollars.




Line of Credit to the SONIBANK

Sector: Foreign Trade

Republic of Niger

Project Objectives:

The line of credit aims at promoting the Arab exports to Niger, through providing the necessary financing for the import operations of Arab goods, to achieve a regular supply to all economic sectors, thus contributing to the achievement of sustainable development and improvement of the living conditions of the population.

The line of credit will contribute to enabling Niger importers to provide essential goods for production and consumption from Arab countries, particularly the neighboring ones, such as Morocco, Algeria, Tunisia and Mauritania, as well as providing working capital for some investment projects which will, in turn, help in expanding productive capacities and creation of supply chains between the Arab countries and Niger.

Project Financing:

The line of credit provided by BADEA to the SONIBANK is 5 million dollars.


Line of Credit to the East African Development Bank (EADB)


Regional

Project Objectives:

The line of credit aims at providing external financial resources to the East African Economic Community which comprises: Kenya, Uganda, Tanzania, Rwanda and Burundi, to enable them to finance their needs in the fields of production and consumption of goods originating in Arab countries.

These countries suffer from foreign currency shortages needed for importing goods of external origin. It is therefore important that they be supported at this stage of development, through providing credit to finance their needs. The goods to be imported will have a pronounced impact in increasing production and creating employment opportunities.

Project Financing:

The line of credit provided by BADEA to the EADB is 15 million dollars.

Date of Approval: 03 June 2016

Loan of Credit to the TIB Development Bank

Sector: Private

United Republic of Tanzania

Project Objectives:

The loan of credit aims at funding private sector operations, through re-loaning of its resources by TIB Bank to recipients in Tanzania, in order to achieve the objectives of the Bank as set in its strategy for the period 2016 – 2020. The loan of credit will make available capital funds needed by the country in addition to other resources from its deposits. Financing of investment expenditures and fixed operating capital will enable investors to expand and develop the existing productive capacities.

Project Financing:

The loan of credit provided by BADEA to the TIB Development Bank is 10 million dollars.

Date of Approval: 28 September, 2016

Loan of Credit to the Uganda Development Bank Limited (UDBL)

Sector: Private

Republic of Uganda

Project Objectives:

The loan of credit aims at funding private sector operations, through re-loaning its resources from the UDBL to recipients in Uganda, with a view to achieve the objectives of the Bank that are linked to the implementaion of the developmental strategy of the country.

The resources of the loan will finance 15 subsidiary projects.

Project Financing:

The loan of credit provided by BADEA to the UDBL is 6 million dollars.


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Annual Report

Line of Credit to the Cotton Development Company


Republic of Cameroon

Project Objectives:

The line of credit aims at the purchase of fertilizers for the Cotton Development Company in Cameroon, in order to contribute to the provision of fertilizers to cotton growers in the north and northern-most areas of the country, who number about 240 thousand farmers, 29 thousand of them are women, to whom cotton is the most important source of income.

It also aims at securing fertilizers at affordable prices to farmers, in addition to poverty alleviation. The line of credit will also ease pressure on the treasury of the Company.

Project Financing:

The line of credit provided by BADEA to the Republic of Cameroon is 25 million dollars.


Line of Credit to the Government of Niger


Republic of Niger

Project Objectives:

The line of credit aims at funding the importation of agricultural and animal production inputs from Arab countries to Niger, within BADEA’s Program to finance trade between the Arab and African regions, in order to promote cooperation and integration between them.

The line of credit will contribute in securing regular supply for priority sectors in the national development, such as agricultural development and animal resources which will reflect positively on the achievement of sustainable development and improvement of living conditions.

Project Financing:

The line of credit provided by BADEA to the Republic of Niger is 25 million dollars.


Line of Credit to the Uganda Development Bank Limited


Republic of Uganda

Project Objectives:

The line of credit aims at financing Arab exports operations to Uganda, through re-loaning its resources through Uganda Development Bank Ltd (UDBL) to recipients in Uganda, in order to achieve the goals of the Bank which are linked to the implementation of the country’s development strategy.

Eight subsidiary commercial operations will be financed from the resources provided by the line of credit.

Project Financing:

The line of credit provided by BADEA to the UDBL is 10 million dollars.


Line of Credit to AMEN Bank


Regional

Project Objectives:

The line of credit aims at financing Tunisian exports (with at least 30% Arab origin) to non-Arab African countries, in order to contribute to the improvement and development of trade relations between the Arab and African regions and support of cooperation and integration between them.

The line of credit will contribute to enabling the African importers to regularly supply their markets, particularly with essential goods such as: medicines, fertilizers, food and petroleum, processed products in priority sectors such as: health, agriculture, food security and energy.

Project Financing:

The line of credit provided by BADEA to the AMEN Bank is 20 million dollars.




Loan of Credit to the Liberian Bank for Development and Investment (LBDI)

Sector: Private

Republic of Liberia

Project Objectives:

The loan of credit aims at financing private sector operations, through re-loaning its resources through LBDI to recipients in Liberia, in order to achieve the goals of the Bank that are linked to the implementation of the country’s development strategy.

LDBI has submitted a list of projects to be financed from the resources of the loan of credit.

Project Financing:

The loan of credit provided by BADEA to the LBDI is 5 million dollars.

Date of Approval: 14 December, 2016

The Second Loan of Credit to the Bank of Investment and Development of ECOWAS

Sector: Private

Regional

Project Objectives: The loan of credit aims at contributing to the development of the private sector in the 15 member states of ECOWAS, through building the financing capacity of the Bank, thus facilitating access of private sector institutions to sources of finance.

It contributes to financing projects and investments of the private sector, providing working capital for many of its activities and attracting new financial resources, as well as contributing to development of income generating projects and strengthening the productive base. This will have a positive impact on the growth of GDP and food security of those countries.

Project Financing:

The loan of credit provided by BADEA to the Bank of Investment and Development of ECOWAS is 15 million dollars.


Line of Credit to the Government of Chad


Republic of Chad

Project Objectives:

The line of credit aims at financing the importation of agricultural and animal production inputs from Arab countries to Chad, within the context of BADEA’s Program for financing trade between Arab and African countries, leading to securing the regular supply to priority sectors in national development, such as agriculture and animal resources sectors, and helping to achieve sustainable development of the country, improve living conditions of the populations and alleviate poverty.

Project Financing:

The line of credit provided by BADEA to the Republic of Chad is 25 million dollars.


Line of Credit to the Government of the Gambia


Republic of the Gambia

Project Objectives:

The line of credit aims at financing of importation of petroleum products from Arab countries to Gambia, in order to achieve the sustainable operation of various sectors, particularly electricity, as the Gambia National Company for Water and Electricity is the main beneficiary of the imports financed by the resources of this line of credit.

This will largely help in stabilizing electricity supply which, in turn, supports main sectors that depend on electricity, in increasing their operational efficiency such as: tourism, agriculture and agro-industry, reflecting positively on the achievement of economic development and improvement of living conditions.

Project Financing:

The line of credit provided by BADEA to the Republic of the Gambia is 20 million dollars.


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Annual Report

Line of Credit to the Liberia Bank forDevelopment and Investment (LBDI)


Republic of Liberia

Project objectives:

The line of credit aims at financing of Arab exports operations to the Republic of Liberia, through re-loaning its resources by LBDI to beneficiaries in the country, in order to achieve the Bank’s goals linked to the implementation of the country’s development strategy.

Project financing:

The line of credit provided by BADEA to the Liberia Bank for Development and Investment is 10 million dollars.

Date of Approval: 14 December 2016

Linr of Credit to the Investment and Development Bank of ECOWAS


Regional

Project objectives:

The line of credit aims at promoting of Arab exports to African countries eligible for BADEA’s assistance, in which the ECOWAS Investment and Development Bank operates, through the provision of appropriate financing of imports operations of Arab goods, to secure regular supply for priority sectors such as energy, industry, agricultural development and health, leading to the achievement of sustainable development, improvement of living conditions and poverty alleviation.

Project financing:

The line of credit provided by BADEA to the Investment and Development Bank of ECOWAS is 45 million dollars.

Date of Approval: 14 December 2016



(C) Technical Assistance Operations

An Arab Expert to the Ministry of Economy, Planning and International Cooperation

Central African Republic

Objective of the Assistance:

The assistance aims at supporting the General Directorate of Economic Programming in the Ministry, through the provision of the services of an Arab expert in engineering specialized in project management, for a period of two years.

The TORs of the expert include: contributing to the preparation of feasibility studies of projects, sectoral studies, supervising studies conducted by external sources, as well as preparation of tender documents, evaluation of offers and according of contracts, supervision of projects financed by BADEA and other Arab institutions, training the staff of the technical agencies in the field of implementing and managing projects and preparing application forms for project and technical assistance financing.

BADEA’s Financing: Non-refundable grant of 320 thousand dollars

Date of Approval: 03 March, 2016

Support to the National

Investment Promotion Agency

Republic of Gabon


The assistance aims at providing institutional support to the National Investment Promotion Agency, to enable it to implement the programs included in the national strategy “Gabon: an Emerging Country by 2025”, through training of 25 staff members of the Agency, under the supervision of the Tunisian Technical Cooperation Agency, with a view to developing and strengthening their technical and scientific capacities on the modern approaches in attracting investments, promotion and marketing as well as developing the public/private sectors partnership.

Support comprises also organization of visits to relevant institutions and learning from similar experiences in the fields of development of investments and business institutions incubators.



Preparation of Master Plan forthe Transportation Sector in “Antananarivo”

Republic of Madagascar

Objective of the Assistance:The Master Plan study aims at identifying strategies of developing and expanding Antananarivo district, to keep pace with the increasing population growth, improving the transport services for travelers and goods, improving the living conditions of the citizens and creating new employment opportunities. The study comprises a comprehensive review of the previous studies about the transport sector, studying the current and future status of land management, studying the prospects of transport between the various parts of the district and its surroundings by 2040, preparing a master plan for transport and its constituent programs and projects, together with conducting financial and economic analyses and preparing a study on the management and operation of the developed transport facilities.



Support to the ArabElectronic Portal (Phase 3)

Regional

Objective of the Assistance:The assistance falls within the objectives of BADEA aiming to creat complementarity between the efforts of Arab and African employers in the field of exchange of economic and social data. The Electronic Portal project aims at bridging the gaps in the field of knowledge management in the Arab World, so as to be a window into development building, through knowledge management and resources sharing and meeting the needs of governments and the private sector, international investors, the civil society and academics in development knowledge. The United Nations Development Program is implementing the project which incorporates manufacturing and operation, under the supervision of OFID. The total cost is 3 million dollars to be borne by the members of the Arab Coordination Group.



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Annual Report

Support to the 18th Conference for the Micro Credit Summit

Regional

Objective of the Assistance:The assistance aims at contributing to the financing of the Conference organized by the Arab Gulf Program for United Nations Development (AGFUND) in United Arab Emirates in March 2016. The Conference reviewed the national strategies for financial inclusiveness and partnership to build bridges towards it, the digital revolution and financial inclusiveness, innovations resulting from practical experience, health and microfinance, innovative agricultural solutions to meet the needs of small farmers, support of women and the opportunities and challenges of Islamic microfinance. The assistance covered the participation of 40 delegates from the Least Developed Countries in Africa, eligible for BADEA’s assistance.


Date of Approval: 03 March 2016

Road Show on the Private Sector Investment Conference in

the Great Lakes Region

Regional

Objective of the Assistance:The assistance aims at financing the promotion campaign for the Conference, in cooperation with the Federation of GCC Chambers. It falls within BADEA’s objectives aiming at encouraging the contribution of Arab private sector in investments in African countries eligible for its aid. The program of the campaign comprised providing information about the countries of the Great Lakes region, explanation of the objectives of the conference and a presentation of the investment climate and the available opportunities. 60 Arab businessmen and investors from the member states of the GCC participated in the campaign, that was launched in Dubai, United Arab Emirates.



Support to the African Program for Fighting River Blindness

Regional


The Program that was launched in 1995 in Ouagadougou, Burkina Faso, aims at eradicating the cause of chronic suffering to 15 million people in Africa. The assistance aims at contributing to the transitional phase of the Program during 2016, to continue realizing the goal of eradication of river blindness in affected African countries by 2025 and strengthening the health systems in these countries. BADEA’s contribution is for funding training sessions for African professionals involved in the eradication of the black fly that causes the disease, in addition to treatment of patients. BADEA already contributed 900 thousand dollars to support this Program. The Program is implemented by the World Health organization (WHO), in cooperation with the World Bank and the ministries of health in the affected countries.



An Arab Expert to support the African Campaign to Fight Tsetse Fly

Regional


To support the African Campaign to eradicate the Tsetse Fly, through financing the services of an Arab expert, for two years, specialized in the field of information management and application of Geographical Information System. The TORs of the expert include: training of communication officers in the national “BATIK” offices in six countries: Togo, Cameroon, Cote d’Ivoire, Tanzania, Mozambique and South Sudan, in the field of GIS and information management, establishing a data base in the “BATIK” coordination office in the African Union Commission and in the other offices in the six countries and designing an electronic network between them, formulating special procedures for data collection, treatment, storage, retrieval and control.

The assistance also includes provision of equipment necessary for establishing the data base.


Date of Approval: 03 March 2016



Participation in the Program for Fighting Blindness (Transitional Phase)

Regional


The assistance is provided in the context of the Alliance to Combat Blindness Program, which was launched in 2009 and aims to finance the campaign of surgeries and training of technicians in the field of eye diseases in: Benin, Burkina Faso, Cameroon, Chad, Guinea, Mali and Niger. These countries are targeted due to the large number of persons who lost their eyesight as a result of cataracts and the shortage in eye doctors and the necessary equipment for treatment.

The Islamic Development Bank is entrusted with supervising the implementation of the Program, in cooperation with the National Program to Combat Blindness of the ministries of health in the recipient countries and with the NGOs active in this field.



Training Course in Preparation, Analyzingand Evaluation of Agricultural Projects

Regional


The assistance aims at funding a training session for two weeks for 20 trainees from English-speaking African countries, with a view to enhance their scientific and technical knowledge in the field of preparation, analysis and evaluation of agricultural projects.

The session comprises a briefing on agricultural projects, their components, stages of preparation and evaluation, technical and marketing studies, how to calculate the financial and economic returns, the use by the project of available local resources and its contribution in developing modern technical approaches and in social development.

The implementation of the training session is entrusted to the Arab Organization for Agricultural Development.



Feasibility Study for the Establishment of Regional Airline for the Sahel Group

Regional


The assistance aims at assisting the Sahel Group (Burkina Faso, Mali, Mauritania, Niger and Chad), through financing preparation of a feasibility study for establishing a regional airline, that serves these countries and supports their economic activities.

The TORs of the study comprise of: studying the market of air transport in the concerned countries, the status of air transport and the projected demand, proposing options for the concept and research in the economics, systems and laws of air transport, study the prices of different services, preparation of the structure of the transport fleet, estimate of the operational costs and preparation of implementation plan, in partnership with the private sector, as well as the study of the financing options.



Forum for the Promotion of Arab Exportsto Some African Countries

Regional


The assistance aims at promoting Arab non-petroleum exports to Sub-Saharan African countries, in order to facilitate the penetration of this type of exports into their markets.

The Forum was held in Algiers in May 2016 and was attended by importers interested in goods produced in Algeria from: Senegal, Mali, Niger, Burkina Faso, Cote d’Ivoire, Gambia, Cameroon and Chad. Representatives of African chambers of trade and Algerian delegates representing companies exporting the non-petroleum goods participated in the Forum, in addition to delegates from Algerian Banking and government institutions involved in foreign trade. The grant funded the participation of 96 African delegates in the Forum.



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Study on the Effectiveness ofTechnical Assistance Operations

BADEA


The assistance aims at the preparation of a study to evaluate the effectiveness of the existing technical assistance operations financed by BADEA, such as the technical and economic feasibility studies for development projects and the institutional support operations that include: financing of training sessions for Africans, provision of the services of Arab experts to African countries, financing of organizing Arab and African businessmen forums and weeks, financing of holding joint Arab-African trade fairs, as well as providing equipment for different institutions in recipient countries. The study also aims at proposing new types of technical assistance operations through external sources.



Guide to Support the Partnership between Arab and African Regions

Regional


The assistance aims at financing the preparation of a manual to monitor the data and information on economic and financial relations between Arab and African countries and analyze the investment obstacles, opportunities and risks in Africa, through the description of the capacities of the member states and regional economic communities in formulating and implementing foreign trade policies and programs, creating a suitable environment for investment promotion and strengthening the economic partnerships between the Arab and African regions.



Preparation of a Soil Fertility Map for Belier and Boro Regions

Republic of Cote D’Ivoire


The assistance falls within the context of BADEA’s objectives aiming at contributing to increase productivity of the agricultural sector in African countries and achieving food security. The grant contributes to preparation of a model map of soil fertility, along the Geographical Information System, in Belier and Boro Regions in Cote d’Ivoire. It comprises: field studies, analysis of soil samples in laboratories, training staff entrusted with collecting samples and providing logistical means. It comprises also: preparation of fertilizing criteria for annual agricultural crops that have no available data, as well as disseminating the study results to all actors in the agricultural sector and fertilizer manufacturers and distributors. The Islamic Development Bank is supervising the implementation of the preparation of the map, in cooperation with the Government of Cote d’Ivoire.



Financing of a Forum for Attracting Arab Investments to Mozambique

Republic of Mozambique


The assistance aims at holding a forum to attract the Arab capital to Mozambique, to be used in investment opportunities and contribute to achieving the economic and social development of this country, as well as supporting trade exchanges between Arab and African regions.

BADEA financed the forum in cooperation with the Exports Promotion Center of the Ministry of Finance of Mozambique. The Forum was attended by Arab investors and representatives of the financing institutions and the public sector in the country.





Feasibility Study for Water Supply Project in Some Rural Areas

Republic of Niger


The proposed project aims at providing drinking water to the population of the project area up to 2040 and improving their health and living conditions.

The feasibility study comprises of: collection and analysis of the demographic, social, economic and environmental data related to the project area, analysis of the data related to existing facilities and systems of water supply, estimate of the future needs for water, preparation of the necessary studies of the availability, uses and quality of water sources, studying of the permanent solutions for securing water production up to 2040, in addition to preparing financial and economic studies of the project and its social and environmental impacts.



An Arab Expert to support the Public Utilities Authority

Republic of Seychelles

Objective of the Assistance:The assistance aims at providing the services of an Arab expert in the field of management and marketing, for two years, with a view to support the Customer Service Department of the Public Utilities Authority in Seychelles. The expert’s TORs include: review of policies and procedures followed by the Department and proposing the necessary recommendations for their improvement in order to develop the customer services, suggesting a special system for receiving and documenting of customer reports and complaints, applying the best practices to ensure the correctness of data provided to the customer, evaluating the staff and training them to improve their performance, in addition to training one of the staff of the Department to replace the expert after the expiry of his contract.BADEA’s Financing: Non-refundable grant of 320 thousand dollarsDate of Approval: 03 June, 2016

Study on the JointArab-African Trade Fairs

Regional


BADEA supports the organization of joint Arab-African trade fairs, throug covering the cost of renting space for the African Least Developed Countries’ pavilions, the cost of travel of two exhibitors from each LDC, as well as of transporting their exhibits. BADEA always has its own pavilion in these trade fairs and organizes a workshop to provide economic and trade data to Arab and African countries

The study aims at evaluating the results of the 7 fairs held up to now, conducting an analytical study of the practical aspects of these fairs and how successful were they in building direct relations between businessmen in the two regions, as well as identifying the administrative and organizational obstacles faced and how to overcome them, to ensure improvement of performance in the future.



Support to the Conference and Fair ofArab-African Businesswomen

Regional


The assistance aims at raising awareness of BADEA as one of the financing institutions that support the role of African women in the society and promot the industrial products of businesswomen with a view to strengthening the involvement of women in economic and investment activities.

BADEA supported the convening of the Conference and the Fair, held in Cairo in November 2016. The important themes of the Conference included: development of women initiatives in entrepreneurship and small and medium-sized industrial enterprises, economic empowerment through building the capacities of Arab and African women, demonstrating some success stories and broadening the horizons of cooperation between Arab and African businesswomen, through the establishment of a strong partnership and a coordinating mechanism.



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Financing the International Conference on Climate Change

Regional


Climate change has become a critically important environmental issue of complex dimensions and interrelations. The main reason behind the phenomenon of climate change is attributed to human activities exploiting the available resources leading to environmental imbalances. The International Conference on Climate Change aims at adopting mechanisms to implement and activate previous conventions, through signing agreements for concrete projects in the field of sustainable development, intensifying debate on important issues such as energy, agriculture and water and mobilization of donors, the private sector and civil society organizations.

Contribution of BADEA is to cover the cost of participation of 60 delegates from the African countries, including travel, subsistence and participation fees.



Study for Evaluation ofArab-African Partnership (2011 - 2016)

Regional


The study was requested by the AU Commission, with a view to determining areas of success and challenges that confront the Arab-African Partnership during the period 2011 – 2016. It is to be prepared by two specialized experts and comprises of: a general outlook of the current Arab-African relations in political, economic, cultural and social fields, an analysis of the available potentialities and the points of strength and weakness, the level of implementation of the strategy, highlighting the successes and challenges encountered in implementation and presenting statistics on trade and investment relations between the two regions and proposing measures to improve them. The study is to be submitted for adoption to a meeting organized in cooperation between the AU, LAS and BADEA.



Training Program for Enhancing Capabilities in the Private Sector Development

Regional

Objective of the Assistance:The training aims at strengthening the capacities of senior staff in English, French and Portuguese speaking African countries, in mastering the formulation of strategies and policies that bolster the private sector, in order to effectively enlist it in the process of economic and social development. The program is to be implemented in two phases, the first phase (for the benefit of 65 officials) comprises of: preparatory of seminars discussing challenges and shortcomings of the African private sector and presentation of best policies and practices. The second phase (for the benefit of 50 officials) comprises of: training of trainers to enable them to train the staff of other African countries, as well as preparation and design of an electronic portal for the training content on the Internet. The training program’s implementation is supervised by the United Nations Institute for Training and Research (UNITAR).



Financing of Arab-African Trade Partnership Program

Regional

Objective of the Assistance:The assistance falls within the context of strengthening and activation of trade between Arab and African regions and enabling trade to play a leading role in energizing the African economy. The Program aims at the promotion of trade exchange between the two regions, through the dissemination of data on trade opportunities and the rules governing them, provision of facilities to businessmen necessary for export of products and the facilitation of cooperation between the business communities, to utilize the available potential in strengthening of trade and investment. The Program will be implemented over 3 years at a cost of 3 million dollars, starting in the first year by implementing preliminary activities that include workshops, training, exhibitions, forums and preparation of studies on logistical platforms. The International Islamic Foundation for Trade Financing is entrusted with the implementation of the Program.





An Arab Expert to support the Ministry of Planning and Inernational Cooperation

Republic of Guinea

Objective of the Assistance:To support the General Directorate for Public Investments of the Ministry of Planning and International Cooperation of Guinea, through provision of services of an Arab expert specialized in the field of agricultural economy and rural development, for two years.

The TORs of expert include: development of relationship between the General Directorate and the offices of strategies in ministries and technical agencies entrusted with the follow up of projects in the agriculture sector, preparation of the TORs of sectoral studies undertaken by the Directorate, mobilization of external financing, contribution in preparation of regional development plans, updating the master plans for rural development projects, contribution to developing a system for building data bases for programming and follow up of these projects and contribution in training of the staff of the Directorate.


Date of Approval: 28 September,2016

Organization of the African Forumon Investment and Business

Regional


Financing the African Forum on Investment and Business falls under the efforts of BADEA in promoting Arab investments in African countries eligible for its aid, and in strengthening Arab-African cooperation. The Forum aims at building economic partnership with actors in African countries, through establishing permanent partnerships, providing a forum for dialogue with African decision makers and creating a suitable base for active partners to discuss investment opportunities.

The Forum was held in Algeria in December, 2016, attended by 80 investors and African businessmen and supervised by the Algerian “CEOs Forum”.



Support to the InternationalConference on the “Quinoa” Crop

Regional


To contribute to sponsoring the International Conference on Quinoa, which aims at enabling participants to understand the importance of Quinoa production. Quinoa is an important product valued as one of the richest protein and minerals sources and for its adaptability to harsh climatic conditions, thus contributing to food security, particularly in rural areas.

BADEA’s contribution covered the cost of participation of 12 professionals from agricultural research institutions and universities involved in agricultural development in: Ethiopia, Mali, Gambia, Burkina Faso, Rwanda and Seychelles, 2 from each country. The Conference was organized by the International Centre for Saline Agriculture in cooperation with FAO, in Dubai in December 2016.



Training Course in the Field ofArtificial Insemination of Cows

Regional


To enhance the technical and scientific capacities of African cadres working in the field of animal resources, through knowledge of ways and techniques of bovine artificial insemination and organization and implementation of artificial insemination campaigns.

The session include: an introduction to bovine artificial insemination and the effects of nutrition on it, the use of hormones to prepare cows for insemination with practical applications, and field visits to some relevant laboratories, institutes and farms. Participants were 20 trainees from French-speaking African countries and the session was organized by the Arab Organization for Agricultural Development in Algeria.



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Arab-African Forum to Support the Partnership and Economic Integration

Regional

Objective of the Assistance:To support partnership and economic integration between Arab and African countries, through promoting Arab exports to African countries eligible for BADEA’s assistance, as well as promotion of Tunisian exports to these countries.

BADEA’s contribution covering the cost of the participation of 70 importers from the African countries attending the forum, in which 250 participants including ministers, trade officials, importers and representatives of commerce chambers in the two regions attended, in addition to the concerned Tunisians institutions and companies. The Forum was organized by the Tunisian Exports Promotion Center, in coordination with other authorities of the country.



Contribution to the Celebration of the 50th Anniversary of the UNIDO

Regional

Objective of the Assistance:To contribute to financing of the events organized on the margin of the celebrations of the 50th Anniversary of Establishment of the United Nation for Industrial Development Organization (UNIDO) in Vienna, in November 2016.

BADEA contributed in financing of two main events: “African Industrialization Day”, which aims at confronting the challenges related to the development of industry in Africa, and “Economic Empowerment of Women”, which aims at raising awareness in African countries about the importance of involving women in the development process, taking into account gender equality.



Support to the Arab-African Economic Forum

Regional


To support the Arab-African economic Forum, held on the margin of the Fourth Arab-African summit in Equatorial Guinea in November 2016.

The Forum, which revolves around Arab-African cooperation in the field of transport, aims at studying ways to develop Arab-African partnership and cooperation between the private sector in the two regions, as a leading sector in comprehensive development, with a view to increase trade exchanges, investments and market penetration.


Date of Approval: 28 September, 2016.

An Arab Expert to Support the Programof Teaching Arabic Language

Republic of Chad


To secure the services of an Arab expert for two years in the field of teaching Arabic language to non-speakers, in order to contribute to the activation and enhancement of the “Pedagogy Center” of the Arab League Educational, Cultural and Scientific Organization (ALECSO) in Chad. The TORs of the expert include: development of programs of the Center in the field of training of Arabic Language teachers, proposing programs for teaching Arabic to senior officials and review of the form and content of the school curricula prepared by the Center, training the teachers of the Center in order to upgrade their academic and professional capacities, preparation of educational newsletters and research, supervision of the cultural and scientific activities, in addition to preparation of regular reports on the performance of the Center, to be submitted to the concerned authorities.





Institutional Support to the Ministry of Planning

Republic of Niger

Objective of the Assistance:To enable the Ministry of Planning of Niger to keep pace with the requirements of development in the country, through preparation of a master plan for economic and social development in the period 2017 – 2021.

This task comprises a preliminary phase that includes adopting policies for the institutional aspects, preparation of a promotion plan for the master plan and a national workshop to formulate its main themes, a phase of a “situation analysis’ to study the economic, social and environmental conditions of each sector and to mobilize the external resources. This is to be followed by a phase for “formulating the guiding principles” that includes identifying the vision, objectives and sectoral programs of development, and lastly, a phase of preparation of a prioritized work plan, on the basis of the sectoral programs and the available resources.



An Arab Expert to Support the Ministry of Finance in Zanzibar

Republic of Tanzania


To support the National Planning Commission of the Ministry of Finance and Planning in Zanzibar, through providing the services of an Arab expert, specializing in development projects management, particularly in the sectors of rural development and infrastructure, for two years.

The expert’s TORs include: support in preparation of plans to develop and implement projects in these two sectors, contribution in the choice and evaluation of effective projects with priority in national development strategies, follow up of projects financed by BADEA and other Arab development financing institutions, follow up of foreign loans, grants and assistance as well as training of the Commission’s staff.



Arab Consultants and Experts in Short Missions

Regional


The technical assistance aims at the provision of the services of an Arab consultant, for a short period of 10 days, in order to activate two loans of credit that were approved by BADEA, for the benefit of the Republics of The Gambia and Benin.

BADEA Financing: Non-refundable grant of 14.70 thousand dollars

Date of Approval:: July, 2016

Support to the Participation of FGCCCin the Private Investments Conference

in the Great Lakes Region

Regional


To support the participation of businessmen and investors in the countries of the Gulf Cooperation Council in the Private Investments Conference in the Great Lakes Region which was held in Kinshasa, Democratic Congo, in February 2016, out of conviction by BADEA in the importance of involving the Arab private sector in developing the economies of African countries eligible of its assistance.

The objectives of the Conference include: getting acquainted with the successful investments in the Great Lakes Region as well as investment potential, strengthening of communication between the participants, with a view to invest in new projects and improvement of the investment climate.


Date of Approval by the DG: February, 2016

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Financing an Event on the Sidelines ofthe Conference of African Finance Ministers

Regional


To finance an event on the margin of the Conference of African Finance Ministers, held in Addis Ababa, during the period 31 March – 5 April 2016.

This support falls within the context of strengthening cooperation with the UN Economic Commission for Africa (ECA), and to utilize the Ministerial Conference to explain the outlook and programs of BADEA during its Five-Year Plan 2015 – 2019. Ministers of finance and senior officials attended the event which included a briefing about BADEA’s Five-Year Plans and its Private Sector Support Program, in addition to the signature of several agreements within BADEA’s operations.

BADEA Financing: Non-refundable grant of 15 thousand dollars

Date of Approval by the DG: February 2016

Workshop on the Prospects of Agricultural Investment Opportunities in Africa

Regional


To finance a workshop on “the Prospects of Agricultural Investment in Africa”, which was held at BADEA’s Headquarters in Khartoum in February 2016, in cooperation with the Islamic Corporation for the Development of the Private Sector (ICD) and the Islamic Development Bank Group of Business Forum (THIQAH).

The main objectives of the Workshop include: demonstrating the investment opportunities in Africa, the possible strategic partnerships and deliberating on finding solutions to the main issues and challenges facing the agricultural sector.

The workshop also reviewed the agricultural potential in Africa which represents a major attraction for many important investment projects.


Date of Approval the DG: February 2016

Support to the 4th Forum for the Development of Enterprises in West Africa

Regional


To contribute in financing the 4th Forum for the Development of General Enterprises in West Africa” which was organized by the Commerce and Industry Chamber of Burkina Faso, in Ouagadougou in March 2016.

The Forum aims at building partnerships between African contractors and their counterparts in other countries in certain sectors such as medical and pharmaceutical activities, agriculture, food industries, traditional industries, public works, energy, environment, textile industry, communications and tourism. 400 contractors attended the forum, 260 of which were Africans.


Date of Approval by the DG: March, 2016

An Introductory Meeting on BADEA’s Programs for Financing Private Sector and Foreign Trade

Hashemite Kingdom of Jordan


To introduce and demonstrate the financing programs of BADEA in both public and private sectors, financing of Arab exports to Sub-Saharan African countries and encouraging Arab investments in African countries, in order to inform Jordanian businessmen and enable them to utilize the opportunities of investments in these countries, as well as the participation of Jordanian contractors and consultancy firms in implementing African public and private sector projects co-financed by BADEA.

The meeting was held in Amman, the Jordanian capital, in April 2016.


Date of Approval by the DG: April, 2016



Support to the Meeting of the Arab-African Youth Council

Regional


The assistance aims at supporting the meeting of the Arab-African Youth Council, on the margin of the 4th Arab-African Summit in Equatorial Guinea in November 2016, under the theme “the Role of Youth in Developing a Joint Arab-African Strategy”.

It aims also at encouraging both parties to exert additional joint efforts, embrace the cultural diversity in the two regions, protect the youth through projects that harness their energies and aspirations, and support the exchange of experiences and expertise as well as develop their capacities.

It is worth noting that the Executive Committee of the Arab-African Youth Council comprises nine countries eligible for BADEA assistance.


Date of Approval by the DG: September, 2016

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PART THREE

Financial Resources

Financial Position as of 31/12/2016

Total net assets of BADEA at the end of 2016 amounted to 4,427.7 million dollars, compared to 4,203.9 million dollars at the end of 2015. The increase of 223.8 million dollars represents the net income for the year 2016 amounting to 123.6 million dollars, plus installments paid by some member countries in BADEA’s capital increase amounting to 101.7 million dollars, in accordance with the Resolution No (4) of the Board of Governors in its Thirty Eight Meeting (Dubai - April 2013), less the grant amounting to 1.5 million dollars which has been allocated, in accordance with the Resolution No (2 ) of the Board of Governors in its Forty-First Meeting (Manama: April - 2016).

CapitalThe balance of the capital as of 31 December 2016 amounted to 3,797.7 million dollars, compared to 3,696.0 million dollars in 31 December 2015, an increase of 101.7 million dollars being installments paid by some member countries in BADEA’s capital increase, in accordance with the Resolution No (4) of the Board of Governors of the year 2013, which stipulated the increase of BADEA’s capital by 1400 million dollars - corresponding to 50% of BADEA’s capital amounting to 2800 million dollars (at that time), effective from January 2014, out of which 700 million dollars to be transferred from the General Reserve and the remaining 700 million dollars as a cash increase from member countries, to be paid in five equal annual installments with first payment due in April 2014.

General ReserveThe balance of the general reserve at the end of 2016 stood at 506.3 million dollars, compared to 492.5 million dollars in 2015, an increase of 13.8 million dollars which represents the net income for the year 2016 amounting to 15.3 million dollars, less the grant allocated by the Board of Governors amounting to 1.5 million dollars.

Special ReserveThe balance of the special reserve at the end of December 2016 amounted to 1.8 million dollars, compared to 0.2 million dollars in 2015, an increase of 1.6 million dollars.

RevenuesBADEA’s total revenues for the year 2016 amounted to 151.4 million dollars, compared to 29.7 million dollars in 2015, an increase of 121.7 million dollars.It is worth noting that BADEA’s liquid resources are invested in short term bank deposits and fixed income and equity portfolios, in accordance with a conservative investment policy, guidelines and specific rules which take into consideration the liquidity requirements, the diversification of investment instruments, with the preservation of capital and achievement of highest possible returns. The most positive results of this policy is to maintain BADEA’s assets and to achieve revenue in the aggregate exceeds what BADEA can realize if the investments were exclusively limited to either short term



deposits or fixed income portfolios or equity portfolios, as a decline in revenue resulting from one of the investment instruments is offset by increased revenue in the other investment instruments.The details of revenue for 2016 and 2015 are as follows

2016 2015 Difference($ Million) ($ Million) ($ Million)

Investment Income 132.6 13.0 119.6

Interest on Loans 18.0 15.9 2.1

Interest on Trade Finance 0.4 - 0.4

Others 0.4 0.8 (0.4)

Total 151.4 29.7 121.7

It is noted from the above figures that investment portfolios revenue in the year 2016 increased by 119.6 million dollars compared to its level in 2015, interest on loans increased by 2.1 million dollars, while revenue from trade finance amounted to 0.4 million dollars.

The objective reasons for the increase of investment income in 2016, can be illustrated through the analysis of its components, as contained in the table below which indicates that the revenue generated from both fixed income portfolios and equity portfolios increased by 37.8 million dollars and 78.8 million dollars respectively, in addition to revenues from Sukuk amounting to 3 million dollars attained during the year, which resulted in higher revenues from the investment of BADEA’s liquid resources during 2016, by about 119.6 million dollars and by 98.3%.

2016 2015 Difference($ Million) ($ Million) ($ Million)

Revenue from Time Deposits and Call Accounts 0.3 0.4 (0.1)Revenue from Fixed Income Portfolios 46.1 8.3 37.8Revenue from Equity Portfolios 82.8 4.0 78.8Revenue from Sukuk 3.0 - 3.0Revenue from Securities Lending 0.4 0.3 0.1

Total 132.6 13.0 119.6

The increase in investment portfolios’ revenue was due to the improved performance of global financial markets during 2016, as a result of the continuing of Quantitative Easing policies of Central Banks, the positive indicators of the United States economy and the improvement of oil prices in the last quarter of 2016. In addition to the widening of economic policies of the new United States administration, compared to 2015 which witnessed decline in the international financial markets, that negatively impacted by the economic and financial events, most importantly the decline of oil prices and fears of slowing of global economic growth, in addition to the Chinese Central Bank’s decision to depreciate its currency.

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The details of investment portfolios’ revenue during the year 2016, compared to 2015 are as follows:

Portfolio Investment Revenues2016 2015 Difference

($ Million) ($ Million) ($ Million)

Fixed Income:Interest on Bonds 37.9 38.2 (0.3)Interest on Time Deposits and Call Accounts 0.1 - 0.1Trading (Loss)Income 14.6 (21.6) 36.2Currency differences and derivatives valuation (2.4) (5.5) 3.1Portfolio Management and Custody fees (4.1) (2.8) (1.3)Total 46.1 8.3 37.8Equities: Dividends 27.4 23.6 3.8Interest on Call Accounts - - -Trading Income 57.6 (14.8) 72.4Currency differences and derivatives valuation (0.1) (2.7) 2.6Portfolio Management and Custody fees (2.1) (2.1) -Total 82.8 4.0 78.8SukukSukuk Profit Margin 1.3 - 1.3Currency differences and derivatives valuation 1.7 - 1.7Total 3.0 - 3.0Securities Lending 0.4 0.3 0.1Total 132.3 12.6 119.7

ExpensesTotal expenses during the year 2016 amounted to 26.1 million dollars, compared to 21.0 million dollars during 2015. Total expenses during 2016 included 17.7 million dollars as administrative expenditure and 8.4 million dollars as grants for technical assistance, compared to 14.9 million dollars and 6.1 million dollars during 2015, respectively.

Net IncomeNet income for the year 2016 amounted to 123.6 million dollars, compared to 15.4 million dollars for the year 2015, thereby increasing by 108.2 million dollars and by 702.6%, due to the increase of the market value of the equity and fixed income portfolios, as a result of improved performance of global financial market during 2016, compared to 2015.

Financial CommitmentsBADEA’s total financial commitments in favor of beneficiary countries during the year 2016 amounted to 306 million dollars, of which 210 million dollars were allocated to finance public sector projects, 86 million dollars to finance private sector projects and 10 million dollars to technical assistance, compared to a total commitments of 260 million dollars during 2015, of which 200 million dollars were allocated to finance public sector projects and 50 million dollars to private sector projects and



(1) Includes grant withdrawals deducted from income, totalling 112.7 million dollars at the end of 2016 and 104.3 million dollars at the end of 2015.

(2) Includes grant withdrawals deducted from income, totalling 104.3 million dollars at the end of 2015.

10 million dollars to technical assistance. The total cumulative net commitments at the end of 2016 amounted to 4,549.3 million dollars, of which 4,408.5 million dollars were allocated for loans and 140.8 million dollars for technical assistance, compared to 4,269.7 million dollars at end of 2015, of which 4,138.1 million dollars for loans, and 131.6 million dollars for technical assistance.

The total commitments for Arab exports financing in 2016 amounted to 200 million dollars, compared to 150 million dollars in 2015.The liquidity ratio (i.e. the ratio of liquid assets to disbursable commitments including financing of Arab exports) at the end of 2016 stood at about 196.2%, compared to 197.5% at the end of 2015. This means that BADEA’s liquid assets represent approximately double the amount of disbursable commitments, which reflects BADEA’s sound financial position and its ability to meet its financial obligations.

Disbursement and RepaymentProject loans disbursement during the year 2016 amounted to 121.3 million dollars, compared to 139.6 million dollars during 2015, thereby decreasing by 18.3 million dollars and by 13.1%. Technical assistance grants disbursement during the year 2016 amounted to 8.4 million dollars, compared to 6.1 million dollars during 2015 corresponding to an increase of 2.3 million dollars and by 37.7%. The Arab exports loans disbursement in 2016 amounted to 20 million dollars.Total cumulative loan disbursement at the end of 2016 amounted to 2,916.3 million dollars, compared to 2,795.0 million dollars at the end of 2015. With the addition of technical assistance grants and Arab exports loans, the total cumulative disbursement at the end of 2016 amounted to 3,049.1(1) million dollars, compared to 2,899.3 (2) million dollars at the end of 2015. Thus, the percentage of cumulative disbursement to net cumulative commitments at the end of 2016 is equal to 67% compared to 68% at the end of 2015, and after adding Arab exports financing it equals to 62% in 2016 compared to 66% in 2015.

5Graph

5Graph

4Graph

3Graph

2Graph

1Graph

Urgent Aid: 12.635 (0.30%)

Social sector: 427.564 (10.19%)

Industry: 51.529 (1.23%)


Energy: 172.664 (4.12%)





Num

ber o

f Tra

inee

s

0

1000

2000

3000

4000

5000

18020162015201420132012201120101975-2009

806309

567

3355

335

4186

454

2016 - 1974

2005 - 1974

1995 - 1974

1985 - 1974

4,335.007

2,314.066 1,567.890

1,239.783 907,690

772.619 576.362

3,029.063

6,122.145

3,465.180

4,549.3

4.500

.000

4.000

.000

3.500

.000

3.000

.000

2.500

.000

2.000

.000

1.500

.000

1.000

.000

500.0

00

000.0

00

3,049.1

506.3

3,797.7

4,509.042

1,666.080

771.960

1,801.8801,584.090

0.000

1,000.000

2,000.000

3,000.000

4,000.000

5,000.000

6,000.000

7,000.000





Million $

94,946 Million $55,62%

75.767Million $44,38%


Operations% 64.56


Operations% 35.44

Million $




BADEAAfrican


World bankGroup

EuropeanUnion


and OFID

IndustrialCountries

.


local entities


General Reserve

Disbursements

Paid-Up Capital


Million $

Million $

Million $

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With regard to repayment, the total installments on loans paid during 2016 amounted to 47.8 million dollars, against 53.4 million dollars during 2015, a decrease of 5.6 million dollars, whereas, the income from interest and fees during 2016 amounted to 18 million dollars compared to 15.9 million dollars during 2015, an increase of 2.1 million dollars. The total amount of interest and charges received from loans during 2016 amounted to 16.9 million dollars, compared to 18.1 million dollars during 2015, a decrease of 1.2 million dollars. While the total amount of interest and charges from Arab exports loans in 2016 amounted to 0.2 million dollars.

Total repayment of loans, including interest and fees amounted to 64.9 million dollars during 2016, compared to 71.5 million dollars during 2015, a decrease of 6.6 million dollars. This decrease is due to the accumulated arrears of some countries due to their difficult financial conditions, and thus the cumulative repayment of principal loans installments at the end 2016 amounted to 1,404.9 million dollars compared to 1,357.1 million dollars at end of 2015; whereas, total cumulative interests and administrative fees collected by BADEA amounted to 548.2 million dollars at end of 2016, compared to 531.1 million dollars at the end of 2015.

ConclusionIt is clear from the foregoing, that BADEA continued its policy of maintaining a sound financial position, through which its net assets at the end of 2016 compared to 2015 increased by an amount of 223.8 million dollars, as a result of the increase of its various revenues, in addition to the receipt of installments in the capital increase from some member countries, while continuing to control administrative spending, in accordance with the policy of rationalizing expenditure followed by BADEA, without prejudice to fulfilling its objectives and programs.

It is worth noting that the net revenue has increased from 15.4 million dollars in 2015 to 123.6 million dollars in 2016, due to the improvement in the market value of securities portfolios, as a result of the strong performance of global financial markets during 2016 as compared to 2015.



ARAB BANK FOR ECONOMIC DEVELOPMENTIN AFRICA

FINANCIAL STATEMENTS31 DECEMBER 2016

With AUDITOR’S REPORT

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STATEMENT OF FINANCIAL POSITION

As at 31 December 2016

(Expressed in thousands of United States Dollars)

Notes 2016 2015ASSETSCash in hand and at banks 17 1,406 1,157Investments 4 2,896,795 2,770,986Contribution in AFREXIM Bank 5 4,000 4,000Contribution in AIECGC 6 24,220 22,490Trade finance 7 20,000 - Accrued interest on trade finance 8 167 - Loan balances 9 1,511,441 1,438,001Net accrued interest on loans 10 14,429 13,560Other assets 11 2,600 17,946Net fixed assets 12 15,672 970

────────── ──────────

Total 4,490,730 4,269,110────────── ──────────

LIABILITIES Other liabilities 50,846 56,468Provision for end of service benefits 13 10,324 8,528

────────── ──────────

61,170 64,996Special reserve provision 3(d), 9(c) 1,794 167

────────── ──────────

Total 62,964 65,163────────── ──────────

Net assets 4,427,766 4,203,947══════════ ══════════

MEMBERS’ COUNTRIES EQUITYSubscribed and paid up capital 14 3,797,761 3,696,018General reserve 15 506,391 492,548Net income for the year 123,614 15,381

────────── ──────────

Total members’ countries equity 4,427,766 4,203,947══════════ ══════════

The attached notes 1 to 23 form an integral part of these financial statements



STATEMENT OF INCOME AND EXPENDITURE

for the year ended 31 December 2016


Notes 2016 2015

INCOMENet income from investments 16 132,599 13,044

Income from loans 18,016 15,893

Income from trade finance 402 -

Others 377 752────────── ──────────

Total Income 151,394 29,689────────── ──────────

EXPENDITUREBoard of Governors 217 205

Board of Directors 1,276 1,111

Salaries and employee benefits 12,192 10,623

Travel and services 2,386 1,941

Utilities 973 816

Depreciation 12 522 157────────── ──────────

17,566 14,853

Other expenditure 145 45

Grants disbursed to beneficiary countries 8,442 6,140────────── ──────────

Total expenditure 26,153 21,038────────── ──────────

Net income before special reserve provision 125,241 8,651

(Charge) reversal of special reserve provision 9 (c) (1,627) 6,730────────── ──────────

Net income for the year 123,614 15,381

══════════ ══════════

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STATEMENT OF CHANGES IN MEMBERS’ COUNTRIES EQUITY



Subscribedand paid-up General Net income

Notes capital Reserve for the year Total

Balance as at 31 December 20143,575,405 322,260 189,209 4,086,874

Paid by member countries14 120,613 - - 120,613

Transfer to general reserve15 - 189,209 (209,189) -

Appropriations- (18,921) - (18,921)

Net income for 2015- - 15,381 15,381

────────── ────────── ────────── ──────────

Balance as at 31 December 20153,696,018 492,548 15,381 4,203,947

══════════ ══════════ ══════════ ══════════

Paid by member countries14 101,743 - - 101,743

Transfer to general reserve15 - 15,381 (15,381) -

Appropriations- (1,538) - (1,538)

Net income for 2016- - 123,614 123,614

────────── ────────── ────────── ──────────

Balance as at 31 December 2016 3,797,761 506,391 123,614 4,427,766

══════════ ══════════ ══════════ ══════════



STATEMENT OF CASH FLOWS



Notes 2016 2015

Cash flows from operating activities:

Net income for the year 123,614 15,381Adjustments to reconcile net income with net cash used in operating activities:Depreciation 12 522 157Charge (reversal) of special reserve provision 9 (c) 1,627 (6,730)Unrealized (gains) losses from investments fair value valuation 16 (44,518) 72,809

Net change in operating assets:Investments (64,921) (111,710)Trade finance (20,000) - Accrued interest on trade finance (167) - Net movement in Loans (73,440) (86,249)Net accrued interest on loans (869) 2,171Net other assets 15,346 (3,825)

Net change in operating liabilities:Other liabilities, net of appropriation (7,160) (14,675)Net provision for end of service benefits 1,796 9

────────── ──────────

Net cash used in operating activities (68,170) (132,662)────────── ──────────

Cash flows from investing activities:Contribution in AIECGC (1,730) (1,730)Net purchase of fixed assets 12 (15,224) (783)

────────── ──────────

Net cash used in investing activities (16,954) (2,513)────────── ──────────

Cash flows from financing activities:Paid for capital increase by member countries 14 101,743 120,613

────────── ──────────

Net cash from financing activities 101,743 120,613────────── ──────────

Net increase (decrease) in cash and cash equivalents 16,619 (14,562)Cash and cash equivalents as at the beginning of the year 140,110 154,672

────────── ──────────

Cash and cash equivalents as at the end of the year 17 156,729 140,110══════════ ══════════

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NOTES TO THE FINANCIAL STATEMENTS

As at 31 December 2016

1- ESTABLISHMENT AND OBJECTIVES

Arab Bank for Economic Development in Africa (“BADEA”) was established in accordance with the resolution of the Sixth Arab Summit Conference held on 28 November 1973 following the recommendations of the Economic Council of the League of Arab States. BADEA was established with a capital of USD 231 million and was subsequently increased in accordance with resolutions issued by the Board of Governors until it reached USD 3,798 million as at 31 December 2016 (2015: USD 3,696 million).

BADEA is an independent international financial institution domiciled in Khartoum, Sudan. It has international legal status, enjoys full legal personality and full autonomy in administrative and financial areas. BADEA is governed by the articles of its Establishment Agreement (the “Establishment Agreement”) and by the principles of International Law. BADEA is located at the following address:

Arab Bank for Economic Development in Africa (BADEA) P. O. Box 2640 Khartoum 11111 Republic of Sudan

BADEA aims at consolidating economic, financial and technical cooperation between African countries and the Arab world. In order to achieve its objectives, BADEA undertakes the following functions:

1. Participation in the financing of economic development in Africa.2. Encouragement the participation of Arab capital in African development.3. Contribution in providing the technical assistance necessary for development in Africa.

2- BASIS OF PREPARATION

(a) Statement of complianceThe accompanied financial statements have been prepared in accordance with the Establishment Agreement, as well as the internal regulations of BADEA.

(b) Basis of measurementThe financial statements have been prepared on the historical cost basis except for investments held for trading and all financial derivatives’ contracts that are measured at fair value.

(c) Functional and presentation currencyThe currency used in BADEA’s operation and preparation of the financial statements is the United States Dollar (“USD”). The financial statements are expressed in USD and are rounded off to the nearest thousands.



(d) Use of estimates

The preparation of financial statements approved by the Bank requires the use of estimates and assumptions that may affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the reporting date, in addition to the amounts of income and expenditure for the year then ended. Such estimates are continually reviewed, based on past experience and other factors.

The significant items in which these estimates are used comprise the following:

i. Special reserve provision

BADEA’s method for determining the special reserve provision is described in the “loans and special reserve provision” (Note 3 (d)) “Loans and Special Reserve Provision” and further explained under credit risk (Note 20(b)).

ii. Fair value of untraded financial instruments

The financial instruments untraded in active markets and their fair value can’t be reliably measured are carried at cost less any impairment provision.

3- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Settlement date

All regular purchase and sale transactions of financial assets are recognized on the settlement date. Those are purchase and sale transactions of financial assets that require delivery of assets within the time frame generally established by regulation or convention in the market place.

(b) Financial assets

BADEA’s financial assets include the following:

i. Fixed income securities and equity investments

All investments in fixed income securities and equity are classified as investments held for trading; and are initially recognized at the fair value of the consideration given.

Such investments are revaluated at fair value that is the quoted market prices at the date of the statement of financial position. Changes in the fair value are recognized in the statement of income and expenditure.

ii. Securities – Sukuk

Financial assets include securities – sukuk, which are acquired to be held for indefinite period of time, and can be sold in response to needs for liquidity or in response to changes in the market conditions. Sukuk are stated at cost less provision for impairment, if any.

iii. Available-for-sale investments

Financial assets whose fair value cannot be reliably measured are classified as available-for-sale investments and are carried at cost less provision of impairment, if any.

Contributions in African Export & Import Bank (“AFREXIM Bank”) and Arab Investment& Export Credit Guarantee Corporation (“AIECGC) are classified as investments available for sale.

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iv. Loan balances

Financial assets of fixed or determined payments that are not traded in active market are classified as loans presented at amounts disbursed after deduction of repaid amounts.

(c) Loans and special reserve provision

All loans granted by BADEA are recognized as assets when disbursed in cash, and are recorded at that value of amounts disbursed.

Interest on loans overdue for 180 days is excluded from the Bank’s income.

The special reserve is calculated in accordance with the Board of Governors’ Resolution No.1 for 1989 for covering overdue loans; as a deduction from the annually recognized income (such provision is named as “Special reserve provision” for presentation purposes of the financial statements). The annually amount allocated for that provision should be equal to the sum of (a) half of the unpaid installments of principal loans overdue at the end of the financial year, and for a period of more than one year and less than two years; and (b) all installments of principal of loans overdue at the end of the financial year and for two years or more.

BADEA believes that the separate presentation of the loans and special reserve in the statement of financial position is complying with the nature of its operations.

Loans under renegotiated repayment arrangements, or installment rescheduling as well as loans under the Initiative of Highly Indebted Poor Countries (HIPC). Under the new arrangements, such loans are classified as performing loans, and treated as new loans.

(d) Impairment of financial assets

An assessment is made at each date of statement of financial position to determine whether there is objective evidence that a financial asset or a group of financial assets may be impaired. If such evidence exists, the estimated recoverable amount and any impairment loss for changes in its carrying amount is determined for that asset.

(e) Revenue recognition

Revenue from interest on bank deposits, fixed income securities, sukuk and loans is recognized on an accrual basis.

(f) Dividend

Dividend income is recognized when it is declared.

(g) Grants

Cost of study, preparation, and technical assistance of the projects are classified as grants and charged to expenditure when disbursed.

(h)Fixed assets

Fixed assets are stated at cost net of accumulated depreciation. The cost of fixed assets is depreciated using the straight-line method over the estimated useful lives of the assets.



The estimated useful lives for the current and comparative year are as follows:

1. Buildings 30 years

2. Fixtures and equipment 5 years

3. Vehicles 5 years

(i) Provisions

Provisions are recognized when the Bank has an obligation, legal or constructive, arising from a past event and the costs to settle the obligation are probable.

(j) Derivative financial instruments and hedging

Derivative financial instruments, including forward contracts and futures, are initially measured at cost; and are subsequently re-measured at fair value. Fair values are generally determined by reference to quoted market prices, discounted cash flow models and pricing models as appropriate. Any changes in the fair values of derivatives that are held for trading purposes are directly included in the statement of income and expenditure.

(k) Foreign currency translation

Transactions denominated in currencies other than United States Dollars are translated into United States Dollars at the exchange rates prevailing at the transaction date. Monetary assets and liabilities denominated in foreign currencies are translated into United States Dollars at exchange rates prevailing at the date of the statement of financial position. Exchange adjustments are charged or credited to the statement of income and expenditure.

(l) Employees’ end of service benefits

End of service benefits for the Director General are computed in accordance with Article No. 6 of the Resolution of the Ministerial Committee selected to review the salaries and benefits of the Presidents and Directors General of Arab Financial Institutions. End of service benefits for employees are calculated in accordance with Article No. (131/) of BADEA’s Employees Regulations as amended by the Board of Directors’ resolutions.

(m) Cash and cash equivalents

For the purpose of preparation of the statement of cash flows, cash and cash equivalents comprise cash on hand and with banks; call accounts and time deposits maturing within three months or less from the date of acquisition.

4- INVESTMENTS

These consist of investments in securities’ portfolios managed by portfolio managers and held for trading, sukuk portfolio, term deposits, and call accounts, as at 31 December

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(USD 000)

2016 2015

Fixed income securities (Note 20) 1,451,823 1,486,720

Equity securities (listed) (Note 20) 1,208,273 1,139,292

Sukuk securities (Note 20) 45,441 -

Fair value of derivative instruments, net (Note 19) 25,124 (4,735)

Accrued interest on deposits and securities (Note 17) 10,811 10,756

────────── ──────────

2,741,472 2,632,033

Term deposits and call accounts 155,323 138,953

────────── ──────────

Investments 2,896,795 2,770,986

══════════ ══════════

Term deposits and call accounts as at 31 December are summarized as follows:

(USD 000)

Managed by

BADEA Portfolio Managers Total

2016 2015 2016 2015 2016 2015

Term deposits 80,957 27,322 - - 80,957 27,322

Call accounts 11,055 39,859 63,311 71,772 74,366 111,631

────────── ────────── ────────── ────────── ────────── ──────────

Total 92,012 67,181 63,311 71,772 155,323 138,953

══════════ ══════════ ══════════ ══════════ ══════════ ══════════

5- CONTRIBUTION IN AFRICAN EXPORT AND IMPORT BANK (“AFREXIMBANK”)

In its 19th annual meeting for 1994, the Board of Governors has approved Resolution No. 4 that BADEA would subscribe by USD 10 million, representing approximately 1.3% of the authorized capital of AFREXIM Bank, of which USD 4 million were paid during 1995 (see Note 22(d)).



6- CONTRIBUTION IN ARAB INVESTMENT & EXPORT CREDIT GUARANTEE CORPORATION (“AIECGC”)

In accordance with Resolution No. 6 of The Board of Governors in its 27th annual meeting for 2002, it was approved that BADEA subscribes USD 17.300 million, representing approximately 9.2% of the authorized capital of AIECGC. BADEA paid the amount in full. The Board of Governors also approved in its 39th annual meeting in accordance with Resolution No.3 of 2014 to increase the contribution of BADEA in the AIECGC’s capital with an amount of USD 8.650 million payable in equal annual installments over five years starting from 2013. Till 2016, BADEA paid four installments; and therefore, BADEA’s contribution in the authorized capital of AIECGC as at 31 December 2016 amounted USD 24.220 million (2015: USD 22.490 million) (Note 22(d)).

7- TRADE FINANCE

The total trade finance amounted to USD 20 million as at 31 December 2016 (2015: Nil) represents part of credit facility granted to AFREXIM of USD 50 million for the purpose of financing Arab exports to African countries.

8- ACCRUED INTEREST ON TRADE FINANCE

Accrued interest on trade finance amounted to USD 167 thousand as at 31 December 2016 (2015: Nil)

9- LOAN BALANCES AND SPECIAL RESERVE PROVISION

a) Loan balances

The details of the loan balances as at 31 December are as follows:

(USD 000)2016 2015

Project loans

SAAFA Loans

Total TotalPublic sector

Private Sector

Approved loans 4,058,206 136,000 214,244 4,408,450 4,138,073Less: Unsigned loans (69,000) (94,000) - (163,000) (67,000)

────────── ──────── ──────── ──────── ──────────

Total signed loans 3,989,206 42,000 214,244 4,245,450 4,071,073Less: ineffective loans (200,400) (15,000) - (215,400) (147,000)

──────── ──────── ──────── ──────── ──────────

Total effective loans 3,788,806 27,000 214,244 4,030,050 3,924,073Less: Undisbursed loans (1,103,964) (9,753) - (1,113,717) (1,128,990)

──────── ──────── ──────── ──────── ────────

Total disbursements from loans 2,684,842 17,247 214,244 2,916,333 2,795,083Less: Loan installments repaid (1,218,346) - (186,546) (1,404,892) (1,357,082)

──────── ──────── ──────── ──────── ────────

Balance outstanding as at 31 December 1,466,496 17,247 27,698 1,511,441 1,438,001══════════ ══════════ ══════════ ══════════ ══════════

SAAFA (the “Fund”) loans represent amounts granted by the Fund to non-Arab African countries prior to the merging of its loans in BADEA’s capital in 1977.

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The movement of the loan balances during the two years ended 31 December, is as follows:

(USD 000)Project loans Total

Public Sector

Private Sector

SAAFA loans 2016 2015

Balance as at 1 January 1,409,116 - 28,885 1,438,001 1,351,752Disbursements during the year 104,003 17,247 - 121,250 139,621Repayments during the year (46,623) - (1,187) (47,810) (53,372)

────────── ────────── ────────── ────────── ──────────

Balance as at 31 December 1,466,496 17,247 27,698 1,511,441 1,438,001══════════ ══════════ ══════════ ══════════ ══════════

b.) The Board of Directors approved BADEA’s participation in the International Monetary Fund (IMF) and World Bank Debt Initiative for Highly Indebted Poor Countries (“HIPC”). The Board of Directors shall address provision of loans individually in light of negotiations with the concerned beneficiary country. BADEA shall participate in such initiative through repayment arrangements of arrears; rescheduling of installments, and/or reduction of interest rates on due installments. Total rescheduled loan under the HIPC arrangements as at 31 December 2016 amounted USD 426.690 million, with an increase of USD 31.502 million compared to the end December 2015 (USD 395.188 million).

c.) Special reserve provision

Details of movement in the special reserve provision as at 31 December are as follows:

(USD 000)2016 2015

Balance as at 1 January 167 6,897Charged during the year 1,627 167Reversal during the year - (6,897)

────────── ──────────

Balance as at 31 December 1,794 167══════════ ══════════

10- NET ACCRUED INTEREST ON LOANS

Net accrued interest on loans as at 31 December, is detailed as follows:(USD 000)

2016 2015Public Sector

Private Sector Total Total

Accrued interest on loans 76,770 269 77,039 76,277

Less: Excluded interest (62,610) - (62,610) (62,717)──────── ──────── ──────── ────────

Net accrued interest on loans 14,160 269 14,429 13,560═══════ ═══════ ═══════ ═══════



11- OTHER ASSETS

Net other assets as at 31 December are summarized as follows:

(USD 000)2016 2015

Rehabilitation and extension of BADEA’s headquarters project (22 (c)) - 14,954

Unrecovered VAT on project 1,517 1,668Others 1,083 1,324

────────── ──────────

Net other assets 2,600 17,946══════════ ══════════

12- NET FIXED ASSETS

The movement of fixed assets at 31 December are as follows:

(USD 000)

BuildingsFurniture & equipment Vehicles Total

CostAs at 1 January 2016 7,615 1,924 261 9,800Additions during the year 15,027 128 69 15,224Disposals during the year - (13) (41) (54)

────────── ────────── ────────── ──────────

As at 31 December 2016 22,642 2,039 289 24,970────────── ────────── ────────── ──────────

Accumulated depreciationAs at 1 January 2016 7,592 1,033 205 8,830Charge for the year 252 245 25 522Disposals during the year - (13) (41) (54)

────────── ────────── ────────── ──────────

As at 31 December 2016 7,844 1,265 189 9,298────────── ────────── ────────── ──────────

Net book valueAs at 31 December 2016 14,798 774 100 15,672

══════════ ══════════ ══════════ ══════════

As at 31 December 2015 23 891 56 970══════════ ══════════ ══════════ ══════════

The lease of land on which the building is constructed was renewed for a 30-year period starting as of 1 January 2017.

13- PROVISION FOR END OF SERVICE BENEFITS

The balance of end of service benefits is invested in a separate bank interest bearing term deposit account managed by BADEA.

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14- SUBSCRIBED AND PAID-UP CAPITAL

The contribution of each member country in BADEA’s capital as at 31 December is presented as follows:

(USD 000)

2016 2015CountryHashemite Kingdom of Jordan 7,991 7,706State of United Arab Emirates 428,095 428,095Kingdom of Bahrain 7,991 7,706Republic of Tunisia 33,214 32,031People’s Democratic Republic of Algeria 159,822 154,114Kingdom of Saudi Arabia 958,933 924,686Republic of Sudan 7,991 7,706Arab Republic of Syria 4,757 4,757Republic of Iraq 559,378 539,400Sultanate of Oman 46,231 44,521State of Palestine 7,991 7,706State of Qatar 319,645 308,229State of Kuwait 586,015 565,086Republic of Lebanon 26,637 23,783State of Libya 570,794 570,794Arab Republic of Egypt 7,991 7,706Kingdom of Morocco 58,602 56,508Islamic Republic of Mauritania 5,683 5,484

────────── ──────────

Total 3,797,761 3,696,018══════════ ══════════

On 2 April 2013, the Board of Governors of BADEA issued their resolution no. 4 of 2013 to increase BADEA’s capital by USD 1,400 million – equivalent to 50% of the capital amounting to USD 2,800 million, effective at January 2014, out of which USD 700 million to be transferred from the general reserve. The remaining amount of USD 700 million shall be paid in cash by Member Countries in 5 equal annual installments starting on April 2014. As at 31 December 2016, the paid-up capital amounted to USD 3,797.761 million (2015: USD 3,696.018 million), increased by USD 101.743 million compared to the end of December 2015. This was paid by certain Member Countries against their share in the capital increase.

15- GENERAL RESERVE

In accordance with Article 36 of the Establishment Agreement, and based on recommendation of the Board of Directors; the Board of Governors shall annually determine the portion of net income that should be transferred to the general reserve, to the shareholders’ capital, or any other transfers in line with the objectives of BADEA. In application to Resolution No. 1 (2) of 2016 of the Board of Governors dated 6th April 2016, an amount of USD 15.381 million (2015: USD 189.209 million) was transferred to General Reserve.



16- NET INCOME FROM INVESTMENTS

Net income from securities’ portfolio for the two years ended 31 December comprises the following:

(USD 000)2016 2015

Interest from fixed income securities 38,288 38,602Dividend from equity securities 27,352 23,682Margin profit on sukuk 1,259 - Currency exchange differences and derivatives valuation (800) (8,262)Net trading income 72,199 (36,465)Management fees- Portfolio managers and custodians (6,176) (4,967)Income from term deposits and call accounts 477 454

────────── ──────────

Net income from investments 132,599 13,044══════════ ══════════

Net trading income for the year ended at 31 December 2016 includes unrealized gain of approximately USD 44.5 million against unrealized losses for the year ended 31 December 2015 of approximately USD 72.8 million, resulting from evaluating investment at the current value at the year-end; as follows:

(USD 000)2016 2015

Unrealized gain (loss) on valuation of equity securities 56,924 (34,394)Unrealized loss on valuation of fixed income securities (12,406) (38,415)

────────── ──────────

44,518 (72,809)══════════ ══════════

Interest income from term deposits and call accounts for the two years ended 31 December, is as follows:

(USD 000)Managed by

BADEA Portfolio Managers Total2016 2015 2016 2015 2016 2015

Term deposits 278 406 128 - 406 406Call accounts 55 19 16 29 71 48

────────── ────────── ────────── ────────── ────────── ──────────

Total 333 425 144 29 477 454══════════ ══════════ ══════════ ══════════ ══════════ ══════════

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17- CASH AND CASH EQUIVALENTS

For the purposes of the statement of cash flows, cash and cash equivalents as at 31 December are composed of the following:

(USD 000)2016 2015

Cash on hand and with banks 1,406 1,157Term deposits and call accounts (maturing within 3 months of contract date) (Note 4) 155,323 138,953

────────── ──────────

156,729 140,110══════════ ══════════

18- FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

Fair value is the price that would be received to sell an asset or paid to transfer a liability in a current transaction between knowledgeable and willing parties in an arm length transaction conducted with other parties. Then, differences between the carrying value and fair value is generated.

The fair values of financial instruments in the statement of financial position, except for loans, trade financing operations, contribution to AIECGC and the AFREXIM Bank, are not significantly different from the carrying values included in the financial statements. BADEA does not currently sell its loans nor does believe that there is a comparable market for these products. Accordingly, it is impractical to determine reliable fair value of these loans.

19- DERIVATIVES

BADEA’s investment guidelines in securities’ portfolios allows utilization of forward and future derivative instruments. Forward and future contracts are contractual agreements to buy or sell certain currency, commodity or financial instrument against specified price at certain date in the future. Forward contracts are customized contracts and traded in the over-the-counter market. While future contracts are traded in standardized amounts on regulated markets. Changes in the value of future contracts are paid on a daily basis.

The table below summarizes the positive and negative fair values of derivative financial instruments, and analysis of the nominal amounts for the remaining maturity term. The nominal amounts, which provide an indication of the volumes of the transactions outstanding at the year end, do not necessarily reflect the amounts of the related future cash flows. Thus, such nominal values don’t reflect BADEA’s exposure to credit risk, that is generally limited to the positive fair value of the derivatives, nor to market risk.



(USD 000)Nominal amounts by term to maturity

Positive fair value

Negative fair value

Total nominal amount

Within 3 months

312- months 15- years Over 5

years2016Forward contracts 29,533 4,409 2,006,089 1,942,508 2,845 35,278 25,458

Futures - - 42,919 42,919 - - - ────────── ────────── ────────── ────────── ────────── ────────── ──────────

29,533 4,409 2,049,008 1,985,427 2,845 35,278 25,458══════════ ══════════ ══════════ ══════════ ══════════ ══════════ ══════════

2015Forward contracts 10,060 14,795 1,847,977 1,847,977 - - -

Futures - - 31,197 31,197 - - - ────────── ────────── ────────── ────────── ────────── ────────── ──────────

10,060 14,795 1,879,174 1,879,174 - - - ══════════ ══════════ ══════════ ══════════ ══════════ ══════════ ══════════

20- RISK MANAGEMENT

The investment policy adopted by BADEA as developed by its Board of Directors, considers BADEA a specialized development institution, whose investment objective is to preserve capital and increase resources without exposing of its assets to significant risks. Therefore, the nature of BADEA necessitates the adoption of a conservative investment policy that mitigates investment risk, in the same manner as adopted by similar development financial institutions. Therefore, BADEA’s investment policy based on a combination of investment in short-term bank deposits, sukuk and securities portfolios, and changing the proportions of resources employed in each of deposits, sukuk and portfolios in the light of the prevailing and expected developments in the financial markets.

a) Custodial risk

BADEA has entrusted the task of safekeeping of its investment portfolio components to a major custodian bank. The custodian safeguards the components of the portfolio, maintains separate accounts for each sub-portfolio, and settles the investment transactions entered into by the portfolio managers.

b) Credit risk

Credit risk is defined as the inability of a counter-party to pay amounts in full when due.

In respect of deposits and investment portfolio held for trading and available for sale; credit risk is managed by establishing certain limits for credit and investment guidelines by the Board based on the credit ratings; financial adequacy of the counter-party, the country or the currency. BADEA’s Management and the Investment Committee, established by the Board of Governors, monitor such limits and guidelines regularly.

2 0 1 6

w w w . b a d e a . o r g 93

Annual Report

The details of concentration of BADEA investments in fixed income securities and sukuk as at 31 December are as follows:

1) According to the sector distribution:

(USD 000)2016 2015

Amount % Amount %

Government 914,101 61% 1,047,845 71%Corporate 363,887 24% 291,745 20%Government authorities 139,193 9% 95,290 6%International institutions 80,083 6% 51,840 3%

────────── ────────── ────────── ──────────

Total 1,497,264 100% 1,486,720 100%══════════ ══════════ ══════════ ══════════

2) According to the geographical distribution:

(USD 000)2016 2015

Amount % Amount %

United States and Canada 780,684 52% 846,813 57%Europe 447,658 30% 420,096 28%Japan 91,333 6% 68,523 5%South East Asia 64,379 4% 72,435 5%Other 113,210 8% 78,853 5%

────────── ────────── ────────── ──────────

Total 1,497,264 100% 1,486,720 100%══════════ ══════════ ══════════ ══════════

3) According to the credit rating in accordance with Standard and Poor’s Agency rating:

(USD 000)2016 2015

Amount % Amount %

AAA 431,952 29% 291,396 19%AA 698,879 47% 917,004 62%A 170,099 11% 128,440 9%BBB 143,160 11% 137,786 9%Other 53,174 3% 12,094 1%

────────── ────────── ────────── ──────────

Total 1,497,264 100% 1,486,720 100%══════════ ══════════ ══════════ ══════════



The following table illustrates the concentration of BADEA investment in securities – equity securities as at 31 December.

1) According to the sector distribution:

(USD 000)2016 2015

Amount % Amount %

Consumable commodities 307,112 25% 254,158 22%Energy 69,166 6% 77,369 7%Financial institutions 235,144 19% 247,747 22%Healthcare 177,162 15% 176,888 15%Industrial 126,467 10% 125,918 11%Information technology 159,216 13% 163,324 14%Production of raw materials 58,969 5% 33,924 3%Telecommunication services 54,834 5% 40,236 4%Public utilities 20,203 2% 19,728 2%

────────── ────────── ────────── ──────────

Total 1,208,273 100% 1,139,292 100%══════════ ══════════ ══════════ ══════════

2) According to the geographical distribution:

(USD 000)2016 2015

Amount % Amount %

United States and Canada 699,491 58% 684,915 60%Europe 365,265 30% 330,130 29%Japan 88,306 7% 84,007 7% South East Asia 46,733 4% 32,762 3%Other 8,478 1% 7,478 1%

────────── ────────── ────────── ──────────

Total 1,208,273 100% 1,139,292 100%══════════ ══════════ ══════════ ══════════

BADEA’s lending program aims at supporting development programs in non-Arab African countries. Loan approvals are subject to a study by BADEA. The borrowing program of BADEA includes provision of loans to or guaranteed by governments. The outstanding loans are considered as sovereign debts. BADEA monitors regular payments of loan installments by the borrowing country, and new loans are suspended for countries that fall in arrears. Periodic reports are also developed on the repayment position of all loans. The borrowing program includes also financing the private sector, and Arab exports to African non-Arab countries.

2 0 1 6

w w w . b a d e a . o r g 95

Annual ReportTh

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2 0 1 6

w w w . b a d e a . o r g 97

Annual Report

BADEA monitors the repayments of its due loans from the borrowing countries and assesses the position of recoverability in accordance with Board of Governors Resolution No. 1 for the year 1989. The following schedule illustrates commitment of countries in repayment of dues as at 31 December 2016:

(USD 000)

Description Number of countries

Project loans

SAFAA loans Total Special

reserve

(a) Performing Countries with regular repayments*Without arrears 13 542,286 - 542,286 - Arrears less than one year 11 542,279 3,134 545,413 -

────── ────── ────── ────── ──────Sub-total 24 1,084,565 3,134 1,087,699 -

(b) Countries with arrangements for settlement of arrears with regular repayments

Without arrears 8 266,756 11,205 277,961 - Arrears for one year and less 3 63,266 1,529 64,795 -

────── ────── ────── ────── ──────Sub-total 11 330,022 12,734 342,756 -

(c) Countries with arrangements for settlement of arrears but not performingArrears for one year and less - - - - - Arrears for more than one year and less than two years 4 40,625 11,830 52,455 1,382Arrears for two years and more 1 9,015 - 9,015 266

────── ────── ────── ────── ──────Sub-total 5 49,640 11,830 61,470 1,648

(d) Countries with no arrangementsfor settlement of arrears and not performing Arrears for one year and less - - - - - Arrears for more than one year and less than two years 3 19,516 - 19,516 146

────── ────── ────── ────── ──────Sub-total 3 19,516 - 19,516 146

────── ────── ────── ────── ──────Grand total 2016 43 1,483,743 27,698 1,511,441 1,794

════════ ════════ ════════ ════════ ════════

*includes an amount of USD 17.247 million relating to loans granted to private sector as at 31 December 2016 (2015: Nil)



The following schedule illustrates regular repayment of dues by countries as at 31 December 2015:

(USD 000)

Description Number of countries

Project loans

SAFAA loans

Total2015

Special reserve

Provision

(a) Performing Countries with regular repaymentsWithout arrears 6 237,773 - 237,773 - Arrears less than one year 22 848,194 3,689 851,883 -

────── ────── ────── ────── ──────Sub-total 28 1,085,967 3,689 1,089,656 -

(b) Countries with arrangements for settlement of arrears with regular repayments

Without arrears 8 206,597 13,366 219,963 - Arrears for less than one year 6 98,798 11,830 110,628 -

────── ────── ────── ────── ──────Sub-total 14 305,395 25,196 330,591 -

(c) Countries with arrangements for settlement of arrears but not performing

Arrears for one year and less - - - - - Arrears for more than one year and less than two years - - - - - Arrears for two years and more 1 17,754 - 17,754 167

────── ────── ────── ────── ──────Sub-total 1 17,754 - 17,754 167

(d) Countries with no repayment arrangements and not performing Arrears for one year and less - - - - - Arrears for more than one year and less than two years - - - - - Arrears for two years and more - - - - -

────── ────── ────── ────── ──────Sub-total - - - - - Grand total 2015 43 1,409,116 28,885 1,438,001 167

════════ ════════ ════════ ════════ ════════

c) Liquidity risk

Liquidity risk is the risk that BADEA may be unable to meet its funding requirements primarily for loan commitments. BADEA maintains adequate funding to meet such obligations when they become due.

2 0 1 6

w w w . b a d e a . o r g 99

Annual Report

d) Interest rate risk

Interest rate risk is the risk that the financial position and cash flows of BADEA may be affected by future fluctuations in interest rates. Favourable fluctuations may lead to increase in the interest income, while unexpected movements may decrease this income.

In respect of deposits, sukuk and fixed income securities, BADEA’s main objective is to ensure safety and liquidity of assets. Subject to these factors, BADEA seeks the highest possible return. Performance is monitored regularly and adjustments are made to the portfolios in the light of market developments.

In respect of loans and foreign trade financing, interest rate is determined independently of market forces by the Board of Directors and at levels consistent with BADEA’s strategic orientation within the framework of its development objective.

e) Foreign exchange risk

Foreign exchange risk is defined as the potential fluctuations in the exchange rates and its effects on BADEA’s financial position and cash flows. BADEA has developed certain limits and controls on foreign exchange; as well as their percentage composition, which are monitored regularly by BADEA. BADEA uses the US Dollar in its lending operations and transactions with banks. In respect of the investment portfolios held for trading, transactions of other limited currencies are allowed. Nevertheless, the US Dollar represents the functional currency against which at least 65% of the total portfolio held for trading including derivatives should be maintained.

The following analysis illustrates assets and liabilities by currency as at 31 December:

(USD 000)Currencies

USD Euro GBP Others Total % of USD2016Total assets 3,365,756 392,157 188,601 544,216 4,490,730 75%

═════════ ═════════ ═════════ ═════════ ═════════ ═════════

Total liabilities 61,170 - - - 61,170 100%═════════ ═════════ ═════════ ═════════ ═════════ ═════════

2015Total assets 3,246,063 405,629 223,446 393,972 4,269,110 76%

═════════ ═════════ ═════════ ═════════ ═════════ ═════════

Total liabilities 64,996 - - - 64,996 100%═════════ ═════════ ═════════ ═════════ ═════════ ═════════

21- TAXATION IMMUNITY

In accordance with Article 40 of its Establishment Agreement, BADEA shall be exempted from all taxes and charges in the member countries. BADEA is also exempted from any restrictions as well as custom duties on importing materials necessary for its operations. This may not be applicable to any dues payable for actual services rendered to the Bank. BADEA is also released and declared from any responsibility related to collection or payment of any tax or duty.

w w w . b a d e a . o r g100


22- FINANCING PLEDGES AND OTHER COMMITMENTS

a) Loans and grants commitments

All loans and grants are governed by agreements and memorandums of understanding with sovereign beneficiary countries. Total of these commitments does not necessarily reflect prospective financial needs; as many of these commitments are ineffective due to non-signature or revocation of the related agreements or memorandum of understanding; or incomplete endorsement procedures. Details of these commitments as at 31 December are as follows:

(USD 000)2016 2015

Public Sector

Private Sector Total

Unsigned loans (Note 20) 69,000 94,000 163,000 67,000Ineffective Loans (Note 20) 200,400 15,000 215,400 147,000Un-disbursed loan (Note 20) 1,103,964 9,753 1,113,717 1,128,990Un-disbursed grants 28,071 - 28,071 27,357

────────── ────────── ────────── ──────────

Total 1,401,435 118,753 1,520,188 1,370,347══════════ ══════════ ══════════ ══════════

b) Trade Finance Program

A provision of USD 200 million was allocated to the Arab trade finance program with African non-Arab countries for the year 2016 (2015: USD 150 million) of which total commitments amounted to USD 150 million (2015: USD 100 million), and unsigned agreements amounted to USD 200 million (2015: USD 50 million).

c) Capital Commitments

Capital commitments relating to the project of rehabilitation and extension of BADEA’S headquarters building as of 31 December 2016 amounted to Nil (2015: USD 1.035 million) (see Note 11).

d) Other commitments

BADEA is committed to settle the following amounts as at 31 December 2016 (see Notes 5 & 6) :

- The residual amount of BADEA’s contribution in AFREXIM’s capital with an amount of USD 6.000 million (2015: USD 6.000 million). This amount should be paid on demand of shareholders.

- The residual amount of BADEA’s contribution in the capital increase of AIECGC with an amount of USD 1.730 million (2015: USD 3.460 million).

23- BOARD OF DIRECTORS APPROVAL

On 8 March 2017, the Board of Directors recommended to issue and present these financial statements to the Board of Governors for final approval.

2 0 1 6

w w w . b a d e a . o r g 101

Annual Report

General Conclusion of the Repport

1- Pursuant to its functions mentioned in its Establishing Agreement, BADEA continued to strengthen and enhancing Arab - African cooperation, through contribution in financing of development projects in African countries, providing them with technical assistance, encouraging investment of Arab capital to them and increasing the volume of trade exchange with them, and this was materialized through the Five-year plans implemented by BADEA so far.

2- BADEA concluded the second year of its Seventh Five-Year plan (2015 - 2019), for which 50% increase in the capital was allocated (1400 million dollars), and therefore, bringing the capital to 4200 million dollars, which helps in further expansion in Africa.

3- 16 development projects in the public sector were approved during 2016, with total loans amounted to 210 million dollars, of which 7 projects in infrastructure sector, 4 projects in agriculture and rural development sector and 5 projects in social sector (Health and Education).

4- Within the framework of “the Private Sector Financing Program”, BADEA extended in 2016 loans of credit to eight (8) African financial institutions, at a total cost of 86 million dollars, representing 86% of the annual allocations for the year.

5- As regard financing of Arab exports to African countries component, for which an amount of 200 million dollars was allocated in 2016, ten (10) lines of credit were approved to the benefit of ten (10) African and Arab financial institutions, representing an increase of 100%, as compared to the allocations of 2015 amounted to 100 million dollars.

6- During the year, 26 development projects in different sectors were completed, with a total value of 190 million dollars benefiting 19 countries and 27 technical assistance operations were completed with a total value of 5.967 million dollars, including 4 feasibility studies and 23 institutional support operations.

7- The year 2016 witnessed several visits from BADEA’s experts to a number of regional development institutions, such as: the African Development Bank, OFID, Islamic Development Bank Group, West African Development Bank, Central African Development Bank and East African Development Bank. It also witnessed great cooperation with international financial institutions, particularly the World Bank.

9- Regarding the financial position, indicators show that BADEA has continued its policy of maintaining a sound financial position, which has resulted in an increase of its net assets which reached 4,427.7 million dollars at the end of 2016, compared to 4,203.9 million dollars at the end of 2015, due to its various income and receipt part of the instalments of BADEA’s capital increase, while continuing to control its administrative expenditure.

It is worth noting that the net income increased to 123.6 million dollars in 2016 from 15.4 million dollars in 2015. This increase is due to the improvement in the performance of the global financial markets during 2016 as compared to 2015.

w w w . b a d e a . o r g102


ANNEXES

Annex I

Evolution of BADEA’s Financing Operations (1975 – 2016)

Annex II

Details of Distribution of Net Commitments by Beneficiary Countries (1975 - 2016)

Annex III

Summary of Annual Sectoral Distribution of BADEA’s Net Commitments(1975 - 2016)

Annex IV

Details of Sub-Sectoral Distribution of BADEA’s Net Commitments (1975 - 2016)

Annex V

Subscription in BADEA’S Capital by Member States & Distribution of Votes until 31/12/2016

2 0 1 6

w w w . b a d e a . o r g 103

Annual Report

ANNEX I

Evolution of BADEA’S Financing Operations (1975 - 2016)

(Amounts in $ million)

Item 1975 - 2010 2011 2012 2013 2014 2015 2016 Total

Number of approved project loans 501 24 21 20 20 18 16 620

Number of approved credit loans 26 2 2 2 2 1 - 35

Number of Special Program operations 14 - - - - - - 14

Number of private sector operations - - - - - 4 8 12

Number of approved technical grants (1) 495 31 32 33 29 35 41 696

Number of SAAFA loans 59 - - - - - - 59

Number of signed loan agreements 497 22 24 23 17 25 12 620

Number of effective loan agreements 462 23 15 28 22 30 11 591

Technical grants deducted against income (2) 74.508 5.319 5.509 6.123 6.689 6.140 8.442 112.730

Technical grants deducted against income by the year of approval 87.478 6.052 4.577 4.628 3.596 3.020 3.379 112.730

Technical assistance and grants commitments 118.713 8.000 8.000 8.000 8.000 10.000 10.000 170.173

Cancelled grants and feasibility studies 25.688 854 418 346 424 91.000 72.000 27.893

BADEA’s commitments - public sector 3,729.883 200.000 200.000 200.000 200.000 210.000 220.000 4,959.883

BADEA’s commitments - private sector - - - - - 50.000 86.000 136.000

Cancelled commitments (3) 734.671 854 12.418 12.346 424 91 72 760.876

BADEA’s Loans 2,904.206 192.000 180.000 180.000 192.000 200.000 210.000 4,058.206

BADEA’s loans including grants and technical assistance 2,995.212 199.146 187.582 187.654 199.576 259.909 305.928 4,335.007

SAFAA loans 214.244 - - - - - - 214.244

SAFAA disbursements 214.244 - - - - - - 214.244

BADEA’s disbursements 1,934.851 131.138 117.760 129.640 127.829 139.621 121.250 2,702.089

Paid - up capital 2,800.000 - - - 775.405 120.613 101.743 3,797.761

(1) Since the beginning of the Third Five-Year Plan (1995 - 1999) it has been decided that technical assistance funds earmarked for feasibility studies are to be considered as grants, whether the study resulted in viable project or not, while up to 1994, those funds were considered as part of the loan in case BADEA has decided to contribute to the financing of the project.

(2) BADEA’s funds include the technical assistance and grants deducted against the revenue.(3) It is the value of loans and technical assistance cancelled as requested by the beneficiary countries, or remaining balances cancelled

from the project’s loan or technical assistance grant after the completion of their implementation, and deducted with reference to the year of the final approval.

w w w . b a d e a . o r g104


ANNEX II

Details of Distribution of Net Commitments by Beneficiary Countries (1975 - 2016)

($ Million) Countries 1975 - 2010 2011 2012 2013 2014 2015 2016 Total

Ethiopia 103.212 10.000 10.021 9.999 10.000 13.250 15.000 171.482Eretria 28.326 14 29 28.369Central African Republic 19.918 300 10.350 319 30.887Angola 10.146 10.146Benin 102.305 10.400 128 13 10.514.6 10.000 133.361Botswana 82.078 82.078Burkina Faso 158.195 11.500 260 12.450 20.512.1 9.400 19.000 231.317Burundi 56.141 9.983 542.1 11.600 78.266Chad 83.274 8.245 10.000 10.000 10.340 20.000 141.859Tanzania 104.549 8.250 10.000 10.338 11.909 10.855.30 155.901Togo 27.591 10.106 9.374 10.280 9.307 66.658Gabon 17.556 61 17.617Gambia 71.542 7.000 8.999 7.000 10.099 104.640Cape Verde 80.682 5.000 7.152 121 12.102 105.057Rwanda 76.016 11.000 5.300 10.333 11.206 15.000 128.855Zambia 57.679 10.000 5.400 189 10.000 83.268Zimbabwe 57.133 3.000 60.133Sao Tome & Principe 8.772 3.200 14 7.532 8.260 27.778Senegal 194.491 9.956 16.000 10.000 11.193.1 10.500 9.000 261.140Swaziland 34.440 10.000 338 10.000 54.778Sierra Leone 53.700 5.853 480 8.000 68.033Seychelles 40.086 265 6.505.5 11.000 320 58.177Ghana 137.002 8.616 8.000 153.618Guinea 143.536 75 9.500 7.438 11.662.1 450 20.320 192.981Equatorial Guinea 8.667 8.667Guinea Bissau 10.584 250 62.1 120 11.016Cameroon 94.329 10.000 300 7.602 11.300 12.000 135.531Congo Brazzaville 38.123 8.000 10.000 56.123Democratic Republic of Congo 37.500 10.002 8.900 10.062.1 66.464Cote d’Ivoire 67.077 6.000 10.000 14.860 10.137 12.493 12.350 132.917Kenya 88.052 10.000 10.000 10.000 10.320 11.000 139.372Liberia 7.011 40 10.000 12.000 29.051Lesotho 75.797 5.000 8.301 89.098Mali 155.488 4.000 400 150 20.000 180.038Madagascar 96.274 11.019 10.066 500 117.859Malawi 62.793 4.000 10.000 10.013 5.5 264 87.076Mauritius 70.395 14 35.5 70.445Mozambique 153.373 10.320 12.000 10.530 9.900 13.080 10.450 219.653Namibia 25.147 25.147Niger 75.335 9.963 5.015 165.8 405 20.720 111.604Nigeria 8.000 8.000Uganda 67.246 5.002 12.000 7.014 40 15.200 11.500 118.002Comoros 7.996 7.996Group of countries (private sector) 10.000 10.000 20.000

Private sector 50.000 86.000 136.000Regional Organizations 59 112 504 846.5 1.145 3.153.7 5.820.2Grants deducted against income 87.596 5.934 4.577 4.628 3.596 3.020 3.379 112.730

Grand Total 2,995.212 199.146 187.582 187.654 199.576 259.909 305.928 4,335.007

2 0 1 6

w w w . b a d e a . o r g 105

Annual ReportA

NN

EX

III

Sum

mar

y of

Ann

ual S

ecto

ral D

istr

ibut

ion

of B

AD

EA’S

Net

Com

mitm

ents

(197

5 - 2

016)

(A

mou

nts

in $

Mill

ion)

Year

Infr

astr

uctu

re

Agr

icul

ture

an

d R

ural

D

evel

opm

ent

Indu

stry

Ener

gyU

rgen

t Aid

Pr

ogra

m

Soci

al S

ecto

rPr

ivat

e Se

ctor

*Te

chni

cal

Ass

ista

nce

Tota

l

Am

ount

%A

mou

nt%

Am

ount

%A

mou

nt%

Am

ount

%A

mou

nt%

Am

ount

%A

mou

nt%

Am

ount

%

1975

- 20

101,

651.

214

55.1

374

1.47

924

.76

51.

529

1.72

172.

664

5.76

1

2.63

5 0.

42

188

.464

6.

2986

.221

2.88

91.0

063.

042,

995.

212

100.

00

2011

122.

600

61.5

628

.200

14.1

6

0.00

-

0.00

0.

0035

.700

17.9

35.

500

2.76

7.14

63.

5919

9.14

610

0.00

2012

77.0

0041

.05

56.6

0030

.17

0.

00-

0.

00

0.00

38.4

0020

.47

8.00

04.

267.

582

4.04

187.

582

100.

00

2013

89.5

0047

.69

45.3

0024

.14

0.

00-

0.

00

0.00

33.0

0017

.59

12.2

006.

507.

654

4.08

187.

654

100.

00

2014

110.

600

55.4

243

.500

21.8

0

0.00

-

0.00

0.

0032

.900

16.4

85.

000

2.51

7.57

63.

8019

9.57

610

0.00

2015

112.

800

43.4

035

.600

13.7

0

0.00

-

0.00

0.

0046

.600

17.9

355

.000

21.1

69.

909

3.81

259.

909

100.

00

2016

108.

500

35.4

749

.000

16.0

2

0.00

-

0.00

0.

0052

.500

17.1

686

.000

28.1

19.

928

3.25

305.

928

100.

00

Tota

l2,

272.

214

52.4

299

9.67

923

.06

51.5

291.

1917

2.66

43.

9812

.635

0.29

427.

564

9.86

257.

921

5.95

140.

801

3.25

4,33

5.00

710

0.00

*Inc

ludi

ng lo

ans

of c

redi

t.

w w w . b a d e a . o r g106


ANNEX IV

Details of Sub-Sectoral Distribution of Badea’s Net Commitments (1975 - 2015)

($ Million)

Total2016201520142013201220111975 - 2010Sector

Infrastructure Sector

1,372.49998.50060.00041.00032.00057.50075.0001,008.499Roads

30.79630.796Railways

18.24518.245River transport

158.78610.00010.000138.786Air transport

27.11727.117Telecommunications

450.20141.80039.50040.00019.50031.200278.201Water supply and drainage

122.28211.6007.50016.40086.782Dams and bridges

92.28810.00011.0008.50062.788 Public services

2,272.214108.500112.800110.60089.50077.000122.6001,651.214Sub -Total

Agriculture and Rural Development Sector

604.41049.00035.60043.50045.30056.60018.200356.210Agriculture and rural development

238.27510.000228.275 Food production

43.22143.221 Livestock and poultry

70.52470.524Fishing

23.74923.749Food industry

19.50019.500Forestry development

999.67949.00035.60043.50045.30056.60028.200741.479Sub - Total

Industry Sector

48.40748.407Building materials

3.1223.122Chemical industries

51.52951.529Sub -Total

172.664172.664Energy Sector: Electricity Production astructures

427.56452.50046.60032.90033.00038.40035.700188.464Social Sector

257.92186.00055.0005.00012.2008.0005.50086.221Private Sector*

12.63512.635Special Programme:Emergency Aid

Technical Assistance:

22,250.83,395.35.7443,133.52.5222.8931.2123.351Countries

5,820.23,153.71.145846.550411259Organizations

112.7303.3793.0203.5964.6284.5775.93487.596Grants deducted against revenues

140.8019.9289.9097.5767.6547.5827.14691.006Sub - Total

4,335.007305.928259.909199.576187.654187.582199.1462,995.212Grand Total* Including loans of credit.

2 0 1 6

w w w . b a d e a . o r g 107

Annual Report

ANNEX V

Subscription in BADEA’S Capital by Member States & Distribution of Votes until 31/12/2016

(Amounts in $ million)

Member States

Shares Voting Power

Total Paid-up Capital Number of Shares Percentage Number of

Votes Percentage

Hashemite Kingdom of Jordan 7,991,111.83 79.91 0.21 279.91 0.67

State of the United Arab Emirates 428,095,277.40 4280.95 11.27 4480.95 10.78

Kingdom of Bahrain 7,991,111.83 79.91 0.21 279.91 0.67

Republic of Tunisia 33,213,969.18 332.14 0.87 532.14 1.28

People’s Democratic Republic of Algeria 159,822,236.89 1598.22 4.21 1798.22 4.33

Kingdom of Saudi Arabia 958,933,421.41 9589.34 25.25 9789.34 23.54

Republic of Sudan 7,991,111.83 79.91 0.21 279.91 0.67

Arab Republic of Syria 4,756,614.20 47.57 0.13 247.57 0.60

Republic of Iraq 559,377,829.13 5593.78 14.73 5793.78 13.94

Sultanate of Oman 46,230,910.57 462.31 1.22 662.31 1.59

State of Palestine 7,991,111.83 79.91 0.21 279.91 0.67

State of Qatar 319,644,473.79 3196.45 8.42 3396.45 8.17

State of Kuwait 586,014,868.62 5860.15 15.43 6060.15 14.58

Lebanese Republic 26,637,039.52 266.37 0.7 466.37 1.12

State of Libya 570,793,703.20 5707.94 15.03 5907.94 14.21

Arab Republic of Egypt 7,991,111.83 79.91 0.21 279.91 0.67

Kingdom of Morocco 58,601,486.86 586.01 1.54 786.01 1.89

Islamic Republic of Mauritania 5,683,283.13 56.83 0.15 256.83 0.62

Total 3,797,760,673.05 37,977.61 100.00 41577.61 100.00

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