Addis Ababa, March 28/2020(ENA)The African Development Bank (AfDB) announced that it has raised an exceptional three billion USD in a three-year bond to help alleviate the economic and social impact the COVID-19 pandemic will have on livelihoods and Africa’s economies.
The Fight COVID-19 Social Bond, with a three-year maturity, garnered interest from central banks and official institutions, bank treasuries, and asset managers including socially responsible investors, with bids exceeding 4.6 billion USD.
This is the largest social bond ever launched in international capital markets to date, and the largest US Dollar benchmark ever issued by the bank, ADB stated, adding that it will pay an interest rate of 0.75 percent.
The African Development Bank Group is moving to provide flexible responses aimed at lessening the severe economic and social impact of this pandemic on its regional member countries and Africa’s private sector.
African Development Bank Group President, Akinwumi Adesina said the bank is taking bold measures to support African countries during these critical times as it addresses the challenges resulting from the coronavirus.
” This 3 billion USD Covid-19 bond issuance is the first part of our comprehensive response that will soon be announced. This is indeed the largest social bond transaction to date in capital markets and we are here to provide significant rapid support for Africa.”
Coronavirus cases were slow to arrive in Africa, but the virus is spreading quickly and has infected nearly 3,000 people across 45 countries, placing strain on already fragile health systems.
It is estimated that the continent will require many billions of dollars to cushion the impact of the disease as many countries scrambled contingency measures, including commercial lockdowns in desperate efforts to contain it. Globally, factories have been closed and workers sent home, disrupting supply chains, trade, travel, and driving many economies toward recession.
Fight Covid-19 was allocated to central banks and official institutions (53%), bank treasuries (27%) and asset managers (20%). Final bond distribution statistics were as follows: Europe (37%), Americas (36%), Asia (17%) Africa (8%,) and Middle-East (1%).