NAFAD: What It Is and Why Accountability Matters

What is NAFAD?

In May 2026, during its Annual Meeting in Brazzaville,  the African Development Bank (AfDB) advanced the New African Financial Architecture for Development (NAFAD) as a framework for the inclusive and sovereign transformation of the continent. NAFAD is intended to change how capital and risk are mobilised, structured and deployed across Africa's financial ecosystem, including by making greater use of domestic savings, regional guarantee mechanisms and local capital markets.

NAFAD seeks to address Africa's $400 billion annual financing gap by tapping the continent's own resources more effectively: unlocking its substantial domestic savings, strengthening guarantee and risk-sharing systems, deepening local capital markets, and mobilising diaspora and philanthropic resources. 

The ambition is significant. And so is the accountability challenge that comes with it.

NAFAD will bring together different sources of capital, financial instruments, institutions and development actors. That may enable African countries and institutions to finance projects at greater scale and speed. But the more complex the financing architecture becomes, the more important it is to ensure that responsibility for environmental and social impacts does not become diffuse - and that communities affected by projects do not fall through the gaps between institutions, instruments or financing arrangements.

Part of the NAFAD commitment includes the "Brazzaville Appeal", a framework that commits to promoting active involvement of civil society and philanthropic organisations in development projects, bringing information closer to communities, and developing mechanisms for monitoring the impact on communities.

That last commitment matters, because monitoring impact requires accountability. If NAFAD is to deliver development that is inclusive and sustainable, communities must be able to understand how projects will affect them, participate in decisions that affect their lives, raise concerns when things go wrong, and obtain meaningful responses and remedies when harm occurs.

This raises a fundamental question for the implementation of NAFAD: As the AfDB and its partners mobilise capital at greater scale, how do we ensure that accountability, environmental and social protections, and access to remedy are built into the architecture from the start?

The Accountability Question

When new types of financing emerge with different stakeholders and structures, there is a risk that the urgency of mobilising capital can outpace the systems designed to protect people affected by the resulting investments. NAFAD's scale and ambition make this risk particularly important to address now, before the architecture is fully operationalised.

Development projects do not distribute benefits, risks and costs equally. Communities living on or around project sites can bear the consequences of land acquisition, displacement, environmental degradation, loss of livelihoods, labour abuses or other harms, while having little influence over how projects are designed or financed. Effective accountability is therefore not an administrative add-on. It is part of ensuring that development finance actually delivers development for the people it is intended to benefit.

With the system as it is, here's what we're learning from communities engaged in accountability processes across IFI-financed projects: African ownership of finance does not, by itself, guarantee accountability to affected communities. The source of capital matters, but so does the architecture through which that capital reaches projects and the rules governing those projects.

The concern, then, is not that African institutions are mobilising African capital. That is precisely the transformative potential of NAFAD. The concern is whether the policies, institutional responsibilities and accountability mechanisms surrounding that capital will be strong enough to protect communities as financing becomes larger, faster and more complex.

What can go wrong when accountability does not keep pace?

Experience from communities seeking accountability in development-financed projects points to recurring weaknesses that NAFAD should address from the outset:

• Before projects start: Meaningful consultation and information

Communities consulted too late or provided with inadequate information have little meaningful opportunity to influence project decisions. Communities that struggle to access basic information about the risks and impacts of projects including environmental assessments, resettlement plans, compensation methodologies and other information have limited understanding of how a project may affect them.

For NAFAD, this matters because faster and more complex financing should not mean less meaningful participation. If anything, greater scale makes early disclosure and meaningful consultation more important.

• When concerns arise: Accessible and effective grievance mechanisms

Communities that have access to project-level grievance mechanisms on paper sometimes still struggle to obtain an effective response in practice. Complaints can go unanswered, accountability mechanisms may lack independence, or communities may not know where responsibility lies when multiple institutions or financiers are involved.

NAFAD's use of multiple financing instruments and actors makes clarity about responsibility particularly important. A community should not have to understand the financing structure of a project in order to know where to raise a complaint.

• Getting remedies: Response, accountability and remedy

When communities do manage to raise concerns, accountability institutions often respond slowly or without sufficient transparency. Even where a complaint is acknowledged, if there is no clear pathway from raising a concern to securing corrective action or remedy, then the institution fails the communities.

An accountability system is only meaningful if it can lead to change. Communities need to know not only where to complain, but who is responsible for responding, how decisions will be made, and what happens when a project or institution has failed to comply with its commitments.

These problems are not necessarily unique to any one institution. They reflect a broader challenge in development finance: accountability processes and mechanisms can become fragmented when financing structures are complex, responsibilities are divided among institutions, or safeguards are treated as a project-level compliance issue rather than as part of the financing architecture itself.

NAFAD has an opportunity to avoid reproducing these weaknesses. The question is whether accountability will be designed alongside the new architecture, or whether it will be addressed only after projects are underway and communities have already experienced harm.

Regardless of how financing is structured or sought, communities shouldn't have to navigate the complexity of accountability or bear the burden of weak safeguards. The AfDB, as the institution leading NAFAD, should ensure that its policies and practices evolve alongside the architecture. Communities affected by NAFAD-supported projects should have meaningful environmental and social protections, accessible avenues to raise concerns, and a clear path to independent accountability and remedy.

This is particularly important because NAFAD is still being developed and operationalised. There is therefore an opportunity—and a responsibility—to establish the rules now, rather than trying to retrofit accountability after financing has already begun to flow.

Accountability Must Be Built Into NAFAD

If NAFAD is going to mobilize resources at scale, accountability needs to be part of that scaling and built into the infrastructure. The objective should not be to slow down financing. It should be to ensure that financing produces sustainable development without shifting the social and environmental costs of that development onto communities.

The AfDB can demonstrate leadership by embedding the following principles into NAFAD as it is developed and implemented:

• Commitment to Non-Regression

The AfDB cannot lower accountability and environmental and social standards in NAFAD projects just because the scale is bigger or the pace is faster. The pursuit of additional and faster financing should not come at the expense of existing environmental and social protections. NAFAD should not create a lower-standard route to financing simply because projects involve new instruments, new partners, guarantees or co-financing arrangements.

At a minimum, the safeguards applicable to AfDB-supported operations should be maintained across NAFAD-supported financing. Where NAFAD creates new forms of financing or risk-sharing, the AfDB should assess whether its existing policies adequately cover those arrangements and strengthen them where necessary.

The principle should be simple: mobilising more capital must not mean lowering the standards that protect people and the environment. NAFAD should build on existing accountability standards, not create opportunities for their erosion.

• Learn From Practice and Build Strong Policies

Study IRM cases and other African cases in different mechanisms. Understand what's working and what's failing. Ask the hard questions: why do complaints go unanswered? Why don't remedies happen? Why do communities still lack recourse?

Then ask communities, civil society, and academia what accountability looks like for them and meaningfully incorporate their proposals. 

This learning should directly inform the design and implementation of NAFAD. The AfDB should systematically examine lessons from its Independent Recourse Mechanism (IRM), project-level grievance mechanisms, and other accountability processes to identify recurring gaps and address them before NAFAD scales.

The AfDB must then strengthen its own Environmental and Social policies to cover the different forms of financing and guarantees that NAFAD will generate. 

This should include reviewing whether the Bank's Environmental and Social policies adequately cover the range of financing instruments, guarantees, intermediated financing and co-financing arrangements that NAFAD may generate. Where the Bank is involved in financing or risk-sharing, communities should not lose access to protections simply because the financing structure is different.

The Bank should also clearly define responsibilities across co-financed and jointly implemented operations. The existence of another financier or implementing institution should not create uncertainty about which safeguards apply, who is responsible for addressing harm, or where affected communities can seek accountability.

Ensure communities affected by AfDB-financed projects have access to both project-level grievance mechanisms and the AfDB Independent Recourse Mechanism (IRM). Project-level for immediate concerns..

Project-level grievance mechanisms can provide an important first avenue for resolving concerns close to where they arise. But communities must also be able to access the IRM when project-level processes fail, when there are concerns about the Bank's compliance with its own policies, or when independent accountability is otherwise necessary. The two levels should complement—not substitute for—one another.

As NAFAD develops, the AfDB should make clear how affected communities can access these mechanisms across different NAFAD instruments and financing structures.

• Strengthen the IRM to Coordinate Across Co-Financed Projects

The IRM needs resources and explicit mandate to effectively respond to the accountability challenges created by increasingly complex and co-financed operations.. From our experience with the IRM, there is already difficulty with resources and capacity in the cases they currently handle. NAFAD will require strengthening the IRM's institutional capacity before it scales.

This is not simply a question of giving the IRM more cases. If NAFAD increases the number, size or complexity of operations involving multiple financiers and institutions, the IRM will need sufficient independence, resources, expertise and institutional authority to perform its mandate effectively.

The AfDB should therefore assess and strengthen the IRM's capacity as part of NAFAD's implementation, and not after the new architecture has generated a larger volume of accountability needs. This should include ensuring that affected communities can identify whether and how the IRM can consider complaints arising from NAFAD-supported operations, including where financing is provided through guarantees, intermediaries or co-financing arrangements.

A Moment for the AfDB

NAFAD is a moment for the AfDB to lead differently and show that African-led finance doesn't have to repeat the accountability failures of what came before. 

NAFAD presents an opportunity to demonstrate that African-led development finance can be both ambitious in scale and strong in accountability. African ownership of development finance should mean more than changing where capital comes from. It should also mean building institutions and policies that ensure development serves the people most affected by it.

The AfDB should use this moment to strengthen its safeguards, clarify responsibility across financing arrangements, protect access to independent recourse, and ensure that the drive to mobilise more capital never becomes a reason to lower the standards that protect communities.

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