Kuwait's Emir Sheikh Sabah al-Ahmad Al-Sabah kicked off the third Africa-Arab summit Tuesday by pledging $1 billion (740 million euros) in low-interest loans and the same amount in investments to African states.
The two-day summit in Kuwait is exploring ways to promote economic ties between the Arab world, which includes wealthy Gulf states, and investment-thirsty Africa.
"I ordered officials of the Kuwait Fund for Arab Economic Development to provide soft loans worth $1 billion to Africa over the next five years," Sheikh Sabah announced.
The emir added that Kuwait, in cooperation with the World Bank and other international institutions, had decided "to provide investments and investment guarantees worth $1 billion" over the coming years focused on infrastructure projects.
The Kuwait Fund is the oil-rich Gulf state's investment and aid arm in African, Asian and Arab countries. It has already provided billions of dollars in low-interest loans for development and infrastructure projects.
Thirty-four heads of state, seven vice presidents and three heads of government are attending the summit, which brings together 71 countries and organisations.
The meeting is the first of its kind since 2010, when leaders met in Libya prior to the Arab Spring uprisings that toppled longterm dictatorships in the region.
The leaders are expected to approve measures and resolutions adopted by foreign ministers on Sunday aimed at boosting economic cooperation between countries in the two regions.
In his opening speech, Sheikh Sabah called for a focus on projects to achieve "food security" in Arab and African countries.
African leaders who address the meeting said an economic partnership between Africa and the Arab world would benefit everyone.
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"It is a win-win partnership for the two sides," said Gabon President Ali Bongo Ondimba. He called for increased cooperation between the private sectors and for the formation of an African-Arab business council.
Ethiopian Prime Minister Hailemariam Desalegn, who is also co-chairperson of summit, said that focused investments by sovereign wealth funds can lead to a "green revolution" in Africa "which is capable of meeting Arab food demands".
Kuwait's Foreign Minister Sheikh Sabah Khaled Al-Sabah said the summit would discuss a proposal by the Africa-Arab Economic Forum to create an Arab-African common market for a combined population of around 1.2 billion people.
The leaders will also look at how to accelerate investment flows into Africa, which is facing an acute investment gap.
According to the World Bank, Africa needs around $30 billion a year just to develop its energy sector.
The International Monetary Fund says African economic growth was a solid 5.0 percent in 2012 despite the world economic crisis. Growth is forecast to ease slightly at 4.8 percent this year and rebound to 5.1 percent in 2014.
In addition, Africa has 12 percent of global oil reserves and 42 percent of its gold deposits. The discovery of large quantities of natural gas off Africa's east coasts has added to the continent's economic potential.
On the other hand, the energy-rich Gulf Cooperation Council states have accumulated surpluses of $2.0 trillion thanks to persistently high oil prices. A majority of the assets are invested in the United States and Europe.
The summit held in Libya three years ago adopted an Africa-Arab Partnership Strategy and a 2011-2016 Joint Action Plan to increase investment, trade and other economic projects.
But implementation has been slow, in part because of the turmoil unleashed by the 2011 Arab Spring, which saw the leaders of Tunisia, Libya, Egypt and Yemen toppled by mass protests and the outbreak of civil war in Syria.