China-Africa Development Fund (CADFund)
What Is the China-Africa Development Fund?
The China-Africa Development Fund (CADFund), laid out in June 2007, is the main Chinese equity investment fund that spotlights on investments in Africa. The CADFund energizes and upholds Chinese ventures to invest in Africa. It is worked by the China Development Bank.
Grasping the CADFund
The China-Africa Development Fund was one of eight measures announced by Chinese President Hu Jintao at the Beijing Summit of the Forum on China-Africa Cooperation in November 2006. It was initiated on June 26, 2007. The investments inside the fund are amassed in industries and fields that assist with advancing Africa's economic development, like agriculture, manufacturing, infrastructure, and resources. The CADFund has turned into the primary platform for Chinese investment in Africa.
Objectives of the CADFund
The CADFund plans to assist with addressing the difficulties that Africa faces in its course of development and to make positive economic and social results. Through its investments, the CADFund centers around reinforcing Africa's development and upgrading its seriousness in the global economic environment. It gives capital financing to companies to invest in Africa, value-added services and aid in settling issues in the landmass, and connections Chinese companies and partners with African ventures.
Principles of the Fund
The CADFund invests in Chinese firms that have economic and trade activities in Africa as well as Chinese firms that have invested in African organizations and ventures. The core values of the fund remember the promotion of investment for Africa, abidance by market regulations and representation of mutual benefits. The fund invests through equity investments, semi equity investments, (for example, preference shares and convertible bonds) and fund investments.
Chinese firms must fit certain criteria to apply. These incorporate a strong credit record, both an unmistakable equity and management structure, strong shareholder relations, a transparent balance sheet and a reasonable strategy for Africa alongside a team that has African experience.
The CADFund gives priority to a number of industries that are central to the development of African countries:
- Agriculture and manufacturing
- Infrastructure and related industries, for example, electric power, energy facilities, transportation and urban water supply
- Natural resources like oil, gas and minerals
- Industrial parks