The Japan Bank for International Cooperation (JBIC) has signed an ODA loan agreement totalling up to ¥11.5bn (US$97mn) with the African Development Bank (AfDB) to finance a private sector assistance loan under the Enhanced Private Sector Assistance (EPSA) for Africa initiative.

The loan will meet the financial needs of private sector companies registered in AfDB’s regional member countries via AfDB’s private sector assistance strategy. This is the first loan that JBIC has provided for the African private sector through AfDB.

The scheme is designed to develop medium-sized economic enterprises, operating midway between the micro-sized manufacturers and smallhold farmers engaging in local economic activities and the multinational enterprises investing in resource development.

EPSA for Africa was proposed by the Japanese government as a joint initiative with AfDB at the G8 Gleneagles Summit in 2005. Under this initiative, JBIC provides financial assistance through AfDB, as well as ODA loans, co-financed with AfDB, for projects undertaken by African governments.

In March 2006, for example, an ODA loan for up to ¥960mn was signed with the Senegalese government to finance the ‘Road Improvement and Transport Facilitation Programme on the Southbound Bamako-Dakar Corridor “