OPEC Fund for International Development (OFID) PDF Print E-mail

Background Information

The Opec Fund was one of most important outcome of the First OPEC (Organization of the Petroleum Exporting Countries) Heads of State Summit in Algiers, Algeria in 1975, when the Finance Ministers of Member Countries proposed the creation of a new multilateral financial facility to channel OPEC aid to developing countries. The Fund,  was originally intended to be a temporary facility, started operations in August 1976 with an initial endowment of $800 million and within little over a year its resources had doubled. By the end of 1977 it had extended 71 loans to 58 developing countries as well as channelling donations from its Member Countries to other development institutions including the IMF Trust Fund and the International Fund for Agricultural Development (IFAD). The OPEC Fund became a fully fledged, permanent international development agency in May 1980. The OPEC Fund for International Development (OFID) aims to foster social and economic progress in the developing world through the provision of concessional financing for developing countries by becoming a platform for ‘South-South’ solidarity. he methods of funding include public sector loans  for development projects and programs, balance of payments support and debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative;  trade financing; support to private enterprises ; grants for technical assistance, food aid, research and humanitarian relief work; and contributing to the resources of other development organizations whose activities benefit developing countries. By data, Today, 121 countries from the developing world - Africa, Asia, Latin America, the Caribbean, the Middle East and Europe - have benefited from OFID's assistance. OPEP Fund has also supported multilateral initiatives including projects of IFAD – International Fund for Agricultural Development and the Common Fund for Commodities (CFC). Key sector priorities of OPEC Fund are infrastructure, energy, agriculture, education, water supply and sewerage and health among others. 

 

Examples of Key Projects of OFID


Health Health OFID has supported through grants or loan a large number of projects on the health sector, especially in HIV/AIDS among other diseases. In Zambia, Zambia, where 73% of the 11.7 million population lives below the national poverty line, the fund enabled the country to open its first ever Cancer Disease Hospital (CDH).
Education A OFID co-financed project in Ghana, aims at enhancing the quality of teaching and learning and strengthening school management in Ghana’s southern region, an area particularly underserved. Thirty six-unit primary school blocks equipped with hygienic sanitation facilities will be constructed, together with accompanying teachers’ accommodation. In order to conserve scarce water resources, each facility will be fitted with rainwater harvesting and storage units. In addition to being wellstocked with furniture and learning materials, the schools will contain a computer room and library. Capacity-building measures will include the provision of Information and Communications Technology training at 38 teacher training colleges. In all, around 8,280 pupils and 180 teachers are expected to benefit from the project.
Water Supply and Sanitation A project financed by OPEC Fund is aiming at the improvement of Malawi. The country has only around 65% of Malawians with access to water supply and sanitation systems, a situation largely responsible for the country’s poor health indicators. Although coverage in urban centres is somewhat higher, aging water supply networks are unable to keep pace with the demand. Small towns and rural communities are also underserved and residents must spend an enormous amount of time fetching water. Two of the country’s largest cities, Blantyre and Lilongwe, experience frequent service interruptions and institutional weaknesses. The project will address these shortfalls by rehabilitating a water processing plant, expanding water distribution systems and replacing and repairing worn equipment in the two cities.
Agriculture In Burundi, for example, the OPEC Fund is supporting a project of Transitional Post Conflict Reconstruction in the sector of agriculture. The multi-faceted project will target around 1.2 million vulnerable individuals in the provinces of Rural Bujumbura, Bururi and Ruyigi, with the aims to boost food security and empower the rural poor, especially women. Activities will range from improving local governance and carrying out awareness-raising campaigns among citizens regarding their legal rights, to improving technical support systems to farmers and supporting environmental conservation schemes. OFID’s loan will specifically co-finance the rehabilitation and development of new farmland, repair of rural roads and construction and renovation of water distribution. In Egypt, the government has planned the building 50 grain silos in 21 of the country’s.
Infrastructure and Energy Infrastructure and EnergyIn Sierra Leone OFID is co-financing the repair of the deteriorated Kenema– Pendembu earth road. The road will be upgraded with asphalt concrete paving and drainage structures built to prevent flooding. In addition, two bridges will be built; one 116 metres long structure to span the Moa River and one 225 m in length to cross the Mahoi River. In Swaziland, similar project have been recently approved to improve the transport conditions of the Sicunusa–Nhlangano Road in the southwest is part of the main network of Swaziland providing an important connection between agricultural areas and urban centres in the country.

 

Source: OPEC Fund for International Development 

Homepages: http://www.ofid.org