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Securing the ALSF mission the imperative of member contributions

Timothy Wasswa Kabugo & Charles Afeku[1]

A. Introduction

Establishment by members

Born in a time of crisis – the early 2000s wave of sovereign debt litigation against African countries – the African Legal Support Facility (ALSF or “the Facility) now stands as a bulwark against future threats. Its continued impact, however, hinges on renewed support from its members states.

Established in 2008, the ALSF emerged in direct response to a 2003 ministerial declaration by African finance ministers calling for “the rapid establishment of a legal technical assistance facility … to deal with creditor litigation” This was followed by their 2007 resolution advocating for the creation of an institution to help African countries to build expertise and capacity to negotiate fair and equitable arrangements for managing natural resources and extractive industries.[2]

Accordingly, the Treaty establishing the ALSF provided for a facility to support African countries in defending against creditor litigation and in strengthening legal capacity to negotiate sovereign investment and commercial transactions. The Treaty has since been signed by 49 African countries. To date, the ALSF has provided more than USD 140 million in legal support to 53 African countries across strategic economic sectors – particularly natural resources, energy, infrastructure, and sovereign finance.

State of member support

Although African countries acknowledge the Facility’s critical role – in promoting fair and transparent transactions, safeguarding national assets, enhancing economic resilience, and fostering sustainable investments – their financial contributions to the very institution they championed have not kept pace. Several factors account for this, including competing fiscal priorities, inadequate resources, resource management challenges, limited awareness or visibility of impact of legal interventions, internal institutional disconnect between ministries of finance and beneficiary ministries or agencies, and in some cases, the perception that the Facility’s services are guaranteed regardless of contribution status.

However, the continent now risks losing the modest but important gains achieved in legal capacity over the past decade – gains that have improved countries’ legal competitiveness and reduced the asymmetry in negotiating power between African states and international investors or creditors.

In this article, we critically assess the continuing relevance of the ALSF and propose ways African countries and their development partners can ensure the Facility is adequately financed to more effectively support Africa’s development goals.

B. ALSF’s Proven Impact and Value

The ALSF provides legal and technical assistance across key development sectors including energy, infrastructure, natural resources, and sovereign finance. Its services cover legal and transaction advisory, due diligence, negotiation and procurement support, risks and contract management, dispute resolution, and creditor litigation. These are delivered through in-house legal and technical experts, as well as panels of competitively selected global and African law firms and advisors.

Beyond providing high quality legal services, the ALSF brings added value by aligning its support with national development priorities, maintaining neutrality in project structuring, integrating sustainability imperatives, and purposely building local capacity. Its country-led, demand-driven approach ensures that legal interventions are not only technically sound but also responsive to broader policy, governance, and institutional objectives. Often, the ALSF’s work triggers regulatory reforms and informs national or regional capacity-building efforts.

Examples of ALSF’s impact include:

Clean Energy – Namibia

In Namibia, the ALSF’s legal external experts provided transaction structuring, legal due diligence, and negotiation support for the country’s USD 10 billion green hydrogen deal. ALSF helped ensure that the legal framework governing the transaction reflected Namibia’s development priorities and safeguard its long-term interests. By integrating ESG standards and ensuring contract transparency, the ALSF helped position Namibia as a pioneer in the global green economy, with the deal expected to produce over 2 million tons of green ammonia annually.

Sovereign Finance – Somalia

In Somalia, the ALSF’s sovereign debt advisory enabled the government to navigate the legal, financial, and procedural complexities of restructuring its debt obligations. Through targeted legal and negotiation support, the country secured the cancellation of USD 1.4 billion in Paris Club debt — nearly 67% of its obligations. This landmark achievement facilitated Somalia’s entry into the HIPC Decision Point, unlocking access to future debt relief and catalysing a more sustainable fiscal trajectory. The ALSF’s efforts extended beyond legal advice: it provided institutional support and helped build negotiation capacity within government.

Infrastructure – Somalia

In the renegotiation of the Mogadishu Port Concession, the ALSF supported the Somali government with legal and economic advisory, contract review, and negotiation strategy. The revised agreement introduced more balanced and transparent terms, enhancing government revenue collection and strengthening regulatory oversight. The outcome is a projected increase in revenues from a key national asset generating over USD 30 million annually, and greater public trust in public-private infrastructure arrangements.

Natural Resources – Guinea

In Guinea, the ALSF’s dispute resolution and arbitration support was decisive in defending the country’s interests in a high-stakes case concerning the Simandou iron ore blocks. By deploying top-tier legal counsel, coordinating technical expertise, and protecting national sovereignty, the ALSF achieved the dismissal of claims exceeding USD 2 billion. This preserved national control over one of Africa’s most strategic mining assets and reinforced Guinea’s sovereignty in managing its natural wealth. The case also informed improvements in the country’s mining legal framework and dispute preparedness.

Across these diverse interventions, the ALSF’s support has been instrumental – not only in delivering legal outcomes but also in driving policy transformation, boosting investor confidence, and advancing economic sovereignty. These outcomes are intentionally designed to contribute directly to continental development aspirations and plans, including the African Union’s Agenda 2063.

C .Why the ALSF Remains Essential

Addressing persistent challenges

Despite its support for numerous high-impact projects since its establishment, African countries continue to face formidable challenges in securing fair, transparent, and development-oriented financial and commercial arrangements. These include:

Unbalanced and opaque contracts in sectors such as energy, infrastructure, and natural resources.
Mounting debt burdens and increasingly complex restructuring processes.
Predatory lending practices and aggressive creditor litigation by vulture funds.
Emerging legal risks related to climate finance, ESG compliance, and shifting global regulatory frameworks.
Digitalisation and data governance, which presents both opportunities and legal vulnerabilities for governments.
Heightened geopolitical competition for African resources and markets, requiring governments to respond swiftly and strategically to preserve national interests and developmental gains.

At the same time, demand for ALSF support continues to rise. The Facility’s expanding project pipeline reflects not only an increase in the volume of requests but also their growing complexity and strategic significance.

Note: Dip in 2020-2021 due to COVID-19 pandemic disruptions.

Unlocking transformative opportunities

The ALSF has only begun to address the continent’s vast and evolving needs. Many government initiatives remain stalled – not for lack of vision, but due to inadequate legal and technical capacity to structure, negotiate, and execute them.

For example, according to UNECA (2025), the implementation of the African Continental Free Trade Area (AfCFTA demands over USD 400 billion in infrastructure and logistics asset investment in the transport sector alone. Similarly, the International Energy Agency’s Global Critical Minerals Outlook 2025 projects that Africa could attract about 10% of the USD 180 – 220 billion in global critical minerals investment expected between 2022 and 2030.

With strengthened legal capacity – including appropriate legal frameworks, improved governance, and risk mitigation strategies – many of these investments could be unlocked. The result would not only be more bankable and inclusive projects but also positive spillover effects across sectors, helping to accelerate Africa’s progress towards sustainable development.

D .The Financial Challenge

As African countries increasingly rely on the ALSF, the Facility’s underlying financial fragility becomes more pronounced. The ALSF Treaty requires only voluntary contributions from members, as well as allocations from the net income of the African Development Bank. Over the past 15 years, the Facility has raised approximately USD 210 million, with more than 90% of these resources coming from the African Development Bank Group and a small group of bilateral donors. In contrast, RMCs have contributed only USD 760,000, despite being the primary beneficiaries of the Facility’s support.

While this donor-reliant model was effective in the Facility’s early years, it is no longer sustainable. Shifting global priorities and growing signs of donor fatigue have placed the ALSF’s financial stability at risk – just as demand for its services is surging and the complexity of requests is deepening. Underfunding threatens to unravel a vital support mechanism at a time when Africa countries need it most.

The ALSF’s current Medium-Term Strategy (MTS) 2023–2027 projects a budget of USD 106 million – an amount equivalent to the total resources utilised by the Facility during its first 12 years of operations (2010 – 2022). While this level of ambition has been justified by the increasing demand and continuing importance of the Facility’s work, its ability to respond effectively depends on securing adequate and predictable funding – ideally in advance of requests – to enable proactive planning, timely support, and scalable impact.

E .Recommendations for Financial Sustainability

The solution to the ALSF’s financial challenge lies in diversifying and expanding its funding base, including the introduction of member contributions and enhancement of co-financing and performance-based financing models – as detailed below.

1.Member contributions

The ALSF currently has 62 members, comprising RMCs, non-regional member states, the African Development Bank, and other international organisations. Introducing a member contribution framework would establish a predictable base of funding to maintain the Facility’s core operations more sustainably and enable more purposeful and strategic resource mobilisation in support of RMCs’ legal and technical assistance needs.

Accordingly, the ALSF members could adopt a mandatory contribution model based on the following structure and conditions:

Tiered contributions based on type of membership:
- RMCs (with differentiation for transition vs. non-transition economies or AfDB borrowing classifications)
- Non-regional members
- Development Finance Institutions (DFIs)
- Other international organisations
GDP-based thresholds for RMCs and non-regional members
Capital base considerations for DFIs
Symbolic or exempt status for non-DFI international organisations

Such a structure recognises the varying capacities of members, while also acknowledging that all members – including DFIs and non-regional members – benefit materially from the ALSF’s contributions to improved legal governance and investment climates in Africa.

Assuming an MTS resource mobilisation target of USD 20 million per annum, membership contributions could be targeted to cover one-fifth of this requirement. This would set a baseline of USD 4 million per year from ALSF members – enough to provide a stable financial foundation for core operations, while maintaining flexibility to mobilise the remainder through donor funding, co-financing, and performance-based models.

2.Co-financing arrangements

The ALSF already implements co-financing arrangements in selected transactions. However, this model could be further strengthened by clearly defining the types of projects eligible for co-financing and by establishing pre-arranged commitments with RMCs ahead of project preparation or implementation. Such an approach would not only stretch ALSF resources but also foster greater alignment with national development priorities and strengthen collaboration with development partners.

To determine when RMC co-financing should apply, the following conditions, among others, should be assessed:

The RMC has the financial capacity to contribute to transaction or project costs;
The ALSF’s involvement de-risks a larger investment or supports transactions involving multilateral partners or DFIs;
A co-financing arrangement would reinforce national ownership and promote the sustainability of the intervention.

Developing a structured and transparent framework for co-financing would also improve predictability for member states and facilitate better planning across the ALSF’s project pipeline.

3.Performance-based fees

The ALSF already applies success fee arrangements in select commercial transactions. These mechanisms should be further enhanced and systematised – particularly for high-value transactions in the infrastructure, extractives, and sovereign finance sectors.

To promote broader uptake and consistency, transparent, objective, and pre-determined criteria for applying success fees should be established. These fees would be payable upon financial close or the achievement of clearly defined milestones.

In line with practices across the development finance sector, such fees should be:

Modest, performance-linked, and transparent;
Proportional to the size of the transaction or the value of cost savings achieved;
Reinvested, where feasible, into a revolving fund to support early-stage project preparation or advisory services for countries unable to pay upfront.

Formalising and expanding the success fee model would help the ALSF to recover a portion of its costs, incentivise efficiency, and enhance its long-term financial sustainability – all while staying true to its development mandate.

F .Conclusion

The ALSF’s influence is expansive, its impact measurable, and its mission more urgent than ever. In recognition of this, the Facility and its members convened on 26 May 2025 under the theme “Resourcing the ALSF to Empower Africa’s Sustainable Development,” to reaffirm their shared commitment to the Facility’s future.

During the Forum, members endorsed a declaration to introduce member contributions, expand co-financing avenues, and scale performance-based financing models—pivotal steps toward reinforcing the ALSF’s financial sustainability. These efforts will enable the Facility to remain a reliable and strategic partner in advancing Africa’s legal empowerment and sustainable development across Africa.

[1] The authors are the Head of Resource Mobilisation and the Manager, Front Office Division, of the ALSF, respectively. The views expressed in this article are those of the authors and do not necessarily reflect the official position of the ALSF.