The G20 launched the new Compact with Africa (CwA) in 2017, the flagship Africa programme of Germany’s G20 presidency, with the aim of enhancing private sector finance, especially in area of infrastructure (albeit not exclusively) in support of African countries’ development objectives.
It is a voluntary programme supported by the International Monetary Fund (IMF), the African Development Bank (AfDB) and the World Bank and rests on the principle of mutual commitment (both the African countries and the international partners) to improve the investment climate while promoting foreign direct investment into participating African countries. It brings together reform-minded African countries, international organisations and bilateral partners from the G20 and beyond to coordinate country-specific reform agendas, support respective policy measures and advertise investment opportunities to private investors. The CwA seeks to promote country reforms in three pillars namely: macroeconomic, business and financing frameworks. Moreover, it is anchored in the African Union’s Agenda 2063 and in each of the country’s aspirations under the 2030 development agenda – emphasising country ownership.
Since its launch in 2017, the CwA has sparked great interest in Africa, with twelve African countries joining the initiative: Benin, Burkina Faso, Côte d’Ivoire, Egypt, Ethiopia, Ghana, Guinea, Morocco, Rwanda, Senegal, Togo and Tunisia. The latest CwA meeting held in August 2021 in Berlin focused on Africa’s recovery from the COVID-19 pandemic, with heads of state emphasising the need to tackle vaccine inequity and increase private sector development on the continent.
The institutional setup of the CwA comprises of representatives of all stakeholders regularly meeting in Compact Teams that have been established in each Compact Country. These representatives coordinate measures on the ground and serve as focal points for investors; they are at the heart of implementing the Compacts.
The Africa Advisory Group (AAG), also created in 2017 under the German presidency, is responsible for leading the CwA, with the aim of improving the environment for private investment in African countries and fostering growth and sustainable development. It is co-chaired by Germany and South Africa, and comprises some G20 members, the African Compact Countries, the World Bank, the African Development Bank, the International Monetary Fund and other stakeholders such as the EU Commission and the OECD. The AAG meets twice a year to monitor progresses made by Compact countries and publishes reports on the progress, future ambitions and measurable targets of each Compact country. The reports of the AAG are supplemented by independent reviews conducted by the African Centre for Economic Transformation (ACET), a T20 African Standing Group member.
The African Advisory Group (AAG) of the G20 finance track coordinates and monitors the initative, publishing reports on the progress, future ambitions and measurable targets of each Compact country. The reports of the AAG are supplemented by independent reviews conducted by the African Centre for Economic Transformation (ACET), a T20 African Standing Group member.
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Visit the Compact with Africa site to find out more.