The China-Africa Development Fund (CADFund) is a Chinese equity investment fund established in 2006 by the China Development Bank (CDB). The primary objective of the CADFund is to promote investment and economic cooperation between China and African countries. By encouraging Chinese enterprises to invest in Africa and facilitating their projects, the CADFund aims to strengthen Sino-African ties and contribute to economic growth and development in African countries.
The CADFund initially started with a commitment of $1 billion from the Chinese government, with plans to increase the fund size to $5 billion over time. The fund focuses on investments in various sectors that are critical to Africa's development, such as infrastructure, agriculture, manufacturing, energy, and natural resources. The fund also seeks to promote Chinese investments in sectors like finance, tourism, and real estate.
The CADFund operates through a two-pronged approach:
- Direct investments: The CADFund directly invests in projects that align with its investment priorities and objectives. This involves taking equity stakes in various businesses and projects, with the aim of providing capital and expertise to support their growth and development.
- Co-investments: The CADFund works alongside Chinese enterprises to co-invest in African projects, providing financial support and guidance to help these companies navigate the complexities of investing in Africa.
The CADFund has played a significant role in facilitating Chinese investment in Africa. As of 2021, it has invested in over 100 projects across more than 30 African countries, totaling more than $6 billion in committed investments. These investments have helped create thousands of jobs, boost local economies, and improve the overall quality of life for people living in African countries.
By fostering greater investment and economic cooperation between China and Africa, the CADFund aims to create a mutually beneficial partnership that can help drive sustainable economic growth and development in both regions. The fund is an important component of China's broader engagement with Africa, which includes various other initiatives such as the Forum on China-Africa Cooperation (FOCAC) and the Belt and Road Initiative (BRI).