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বাংলা
Dhaka Tribune

French AFD emerges as key partner for Bangladesh

  • AFD has tripled over the past five years
  • Reaching Euro 1.8 billion
  • French agency is set to celebrate its 10-year anniversary
Update : 23 Apr 2024, 11:55 PM

The French Development Agency, Agence Française de Développement (AFD), has emerged as a major development partner of Bangladesh over the past decade, financing key government projects for sustainable development.

Despite a slow start in 2012, funding from the AFD has tripled over the past five years, reaching Euro 1.8 billion.

In contrast to Western development agencies, the French AFD solely collaborates with the Bangladesh government on much-needed infrastructure projects such as health, water supply, energy, and transport.

"We trust the government," AFD country director in Bangladesh, Benoit Chassatte, told Dhaka Tribune as the French agency is set to celebrate its 10-year anniversary in Bangladesh on Thursday.

Turning Point

In September 2020, amidst the chaos of the Covid pandemic, a pivotal moment arose. With India's vaccine crisis at the beginning of 2021, the Bangladesh government's AstraZeneca deal collapsed, leaving them scrambling for alternatives.

The government was desperately seeking financial aid to procure vaccines from other sources. AFD, still relatively new and little-known in Bangladesh, where institutions like the World Bank, ADB, JICA, and AIIB dominate the aid market, stepped in with its highly concessional package to assist the government.

After intense negotiations, AFD secured a €200 million concessional loan from France.

"This marked a turning point in our relationship, paving the way for increased cooperation," the country director said.

"The initial start was a bit difficult, but that's understandable when you have a new partner entering the field. The government doesn't know who is there and what the financial conditions are. So, it takes time to get to know each other, build trust, and develop the relationship. It took time."

"This vaccine loan was signed in Paris when Prime Minister Sheikh Hasina visited and met with the French president in November 2021. That deal was concluded in less than a year, which was quite an achievement for us and for our relationship with the government," the country director added.

"It was definitely a turning point. After that, we started to have a very trustworthy relationship with the government. We listened to their needs and tried to align them with our strategy, which is very focused on climate change. We ensure that projects are climate-friendly and dedicated to addressing climate change," he said.

At the beginning of 2020, the AFD's commitment to Bangladesh was approximately Euro 500 million. Today, the total commitment stands at Euro 1.8 billion, including 135 million for the private sector.

We trust the government

France takes interest in Bangladesh as part of its effort to consolidate its presence in the Indo-Pacific. President Emmanuel Macron visited Dhaka in September last year, advocating for the idea of "strategic autonomy" and a "multi-polar world," contrary to the common perception among Bangladeshis that the US and Russia dominate the world in two camps, with China emerging as a power.

"We don't perform miracles. I realized that we (AFD) arrived at the right time, offering mostly concessional loans. Bangladesh has transitioned from needing charity for humanitarian work and financing to needing major infrastructure. You can see it everywhere, big infrastructure projects costing billions of dollars," Country Director Chassatte said.

"Our success stems not only from offering mostly concessional loans but also from fostering a reliable relationship with the government," he added.

Unlike some other development partners who prefer to bypass the government, we prioritize collaboration with governmental bodies like ADB, JICA, and the World Bank, he noted.

This approach ensures that funds are directed to the government, promoting accountability and sustainability in project implementation.

Trusting the government is paramount for long-term transformative change, he emphasized.

While NGOs play a valuable role, sustainable progress hinges on governmental involvement and commitment. By entrusting funds to the government, we empower them to mobilize local resources and engage communities.

This model not only holds the government accountable to its citizens but also ensures continuity beyond external funding cycles, the country director observed.

Future

AFD implements French policies for sustainable development and international solidarity in more than 150 countries.

In Bangladesh, 70% of the total portfolio contributes to the fight against climate change, while 60 percent of projects contribute to gender equality. Additionally, 7.5 million people are gaining access to safe drinking water, and over 5 million people are gaining access to reliable electricity.

They are co-financing the construction of a bus rapid transit (BRT) line, which will connect the north of the city to the airport. These high-capacity buses will operate on a reserved lane.

AFD is also co-financing two new drinking water treatment plants to improve the distribution of water resources.

They are also supporting the strengthening of DPDC’s Power Grid with the objective of increasing the production, transmission, and distribution capacity of Bangladesh’s power sector, among other initiatives.

They are responding to the government’s need for budget support aligned with the IMF.

For the next five years, their focus is on supporting the government in fighting against the impacts of climate change and graduating from the LDC status.

"We received a new directive from the President (Macron) to focus on the fight against adaptation. Our regional director is coming from Sri Lanka. On Wednesday, we'll have a thorough discussion with the government to determine which kind of projects they want us to finance in line with the National Adaptation Plan," the country director said.

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