The African Development Bank (AfDB) and Japan have announced a $3bn private sector development initiative to boost growth and reduce poverty in Africa.

The resources, to be provided under the third phase of the Enhanced Private Sector Assistance for Africa (EPSA) initiative, will focus on, among other things, infrastructure - transport and energy.

Japan will target to provide $ 1.5bn over three years through the Japan International Cooperation Agency (JICA), whereas the AfDB expects to finance at least an equal amount.

In addition, Japan is ready to provide an additional special allocation of $300m for co-financing with the AfDB to help African countries access the best low emitting clean coal technologies available.

"African economies must diversify by industrializing very fast. For this to happen, we need to solve the energy crisis," said AfDB Group President, Akinwumi Adesina, speaking at the Sixth Tokyo International Conference on African Development (TICAD VI).

The Bank's New Deal on Energy for Africa seeks to solve Africa's huge energy deficit by 2025.

Adesina pointed out the critical role of research and development (R&D) in boosting growth, and urged African leaders to invest in the sector as in the case of Asia in order to realize increased development.

"Research and development is at the core of what Asia has done. Africa spends only 0.1% of its GDP on R&D; this is so small compared to Japan which spends 3.7% of its GDP on R&D. We cannot succeed without R&D," he stressed.

Political will was cited as a key ingredient for ensuring formulation of the right policies for development.

According to President Paul Kagame of Rwanda, "the basis of development for any society is going to be good politics. This will give way to the right policies that can blend into global instruments to forge one development path."

Some of the policies, especially around economic integration, are necessary to move the continent from one that exports raw materials into one that adds value to its products, noted Ellen Johnson Sirleaf, the President of Liberia.

Such policies, she asserted, will encourage inter-country trade, which is currently too low in Africa.

Sub-Saharan African countries have the lowest trade among themselves compared with other regions.

Statistics from the AfDB indicate that intra-African trade accounts for 11% ($110bn) of the value of total African trade.

Additionally, policies targeting youth employment emerged as crucial, particularly those enhancing digital technology.

The AfDB has established the Jobs for Youth in Africa (JfYA) Strategy, aimed at creating direct and indirect employment in several sectors including ICT.

The JfYA will see the Bank invest $5bn over the next ten years and create 25 million new jobs.

These investments are expected to create opportunities for 50 million young people.

Japan, for its part, reiterated commitment to supporting African institutions to advance technology in Africa.

Taku Otsuka, Japan’s State Minister of Finance, pointed out that “Japan would lay out concrete and tangible measures to support Africa”.

“We look forward to continued close collaboration with the AfDB so as to further accelerate the development of the African private sector, by delivering resilient and high-quality infrastructure and strengthening the health system,” he added.