African Development Foundation

THE AFRICAN DEVELOPMENT Foundation (ADF) is an independent federal agency and a nonprofit corporation created by the U.S. Congress in 1980. The foundation supports community-based, self-help initiatives that are designed to alleviate poverty and promote sustainable development in Africa.

As part of U.S. foreign assistance efforts, the ADF seeks to promote greater economic prosperity and political stability on the African continent. Toward these ends, ADF works to strengthen the bonds of friendship and understanding between the people of Africa and the United States; support self-help activities at the local level calculated to expand opportunities for community development; stimulate capacity-building and assist with effective and increasing participation of Africans in the development process on the continent; and encourage the establishment and growth of development institutions that are indigenous to African countries capable of responding to the requirements of the poor in those countries.

The foundation began field operations in 1984; its efforts complement larger bilateral aid programs by approaching development projects from the ground up. [Page 12]This method of funding innovative models of participatory development provides incentives for local entrepreneurs to craft profitable schemes. Through the provision of small ($50,000 to $250,000) grants, loans, and loan guarantees to African entities, ADF seeks to support projects that are indigenous in origin and that have the potential to be replicated on a larger scale by the private sector, other development agencies, and African governments.

In conjunction with nongovernmental organizations that serve as national partner organizations, ADF provides funds directly to African community-based groups, registered cooperatives, economic interest groups, producer associations, community development associations, and registered limited liability companies in order to stabilize economic opportunity, security, and sustained productivity in local communities.

ADF supports African expertise and knowledge-building capacities by ensuring that project activities are locally conceived and implemented and local African experts provide technical assistance. Unmediated assistance to carefully screened clients provides a catalyst for development for micro- and small enterprises, producer groups, and marginalized communities. The assistance is intended to encourage an entrepreneurial spirit and alleviate poverty. The larger goal is to enable long-term development and modernization of African communities by promoting strategic trade and investment opportunities for small and medium-scale enterprises.

Under its trade and investment program, ADF provides African businesses with access to technology, working capital, market information, and technical and managerial assistance. ADF has initiatives in nine African countries to help small businesses tap regional and overseas markets. The African Development Foundation enters into strategic partnerships with public-and private-sector entities to enhance trade linkages. All ADF projects are fully monitored and regularly undergo participatory evaluations supported by African experts to help ensure the success and longevity of projects. ADF fosters the development of indigenous partner organizations that are wholly African led and designed to become self-sustaining national development resources.

ADF requires that successful clients participate in the Community Reinvestment Grant program whereby profitable grant recipients reinvest a portion of their profits into community development projects within their country. This payback approach creates a multiplier effect and generates renewable pools of capital used for grassroots-level development projects. The foundation has developed a model of venture philanthropy that combines the rigor of investment banking with the values of conventional development. Before a project is funded it is evaluated for profitability, socioeconomic impact, and sustainability with potential for replication or scaling up. The African Development Foundation has funded over 1,300 activities in 34 African nations.

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