Bank proud of Afreximbank’s achievements as a strategic partner in trade finance
Abidjan, Côte d’Ivoire, 16 July 2018 – The African Export-Import Bank (Afreximbank) has become a reputable and solid regional development finance institution, meeting significant financing needs in trade development and trade finance in Africa, says President of the African Development Bank, Akinwumi Adesina.
Afreximbank is one of African Development Bank’s most important non-sovereign partners. Over the years, the Bank has provided more than US$1 billion in various forms of financial support to Afreximbank, including equity, trade finance, lines of credit and guarantees.
Adesina, who spoke at a gala dinner at the 2018 Annual Meetings and 25th Anniversary of Afreximbank in Abuja, assured that the Bank will remain supportive, steadfast, and strong in its assistance for the export-import bank’s continued growth.
As a founding parent, the African Development Bank is proud of its instrumental role in laying Afreximbank’s foundations and the achievements that the institution has made as its strategic partner, particularly in trade finance in Africa.
The Bank is also collaborating with African Union Commission, Economic Commission for Africa, Regional Economic Communities, Afreximbank and other partners to ensure that African countries can offer better trade facilitation, increased trade finance, and beneficial policies to increase trade.
“Africa is in a hurry because it is hungry for economic transformation. We must move quickly from old methods of intervention in dealing with emerging challenges and taking advantage of opportunities. We must do better, more, and quicker,” the President said. “This is especially so in the trade finance space. We need to be smarter and faster in responding to growing opportunities and emerging challenges faced by majority of the continent’s small businesses.”
Adesina said the signing of Africa’s Continental Free Trade Area (AgCFTA) agreement in March 2018 by the majority of African countries will enable Africa to trade more with itself and also enhance the continent’s attractiveness as an investment destination.
African countries are showing resilience as exemplified in the share of intra-African trade, which has increased from 10% in 2000 to 16% last year.
Since the AgCFTA was signed, the African Development Bank has earmarked US$ 4.5 millionto help boost intra-African trade and create more synergies with the Bank’s High 5 priorities.
“We need to significantly expand intra-African trade. For example, the equivalent figure for Europe is close to 80%. For this to happen, Africa needs to be bolder in its approach and broaden its appeal by reducing administration and transaction costs, especially at borders, as well as overcome market segmentation and improve the overall investment climate.”
The 25th anniversary celebration witnessed a critical US$500,000 grant agreement collaboration between the African Development Bank and the Afreximbank.
The project, funded by the Fund for Private Sector Assistance (FAPA), is aimed at promoting the development of ‘factoring’ as an alternative trade finance instrument in Africa. The investment confirms the African Development Bank’s commitment to support extra- and intra-Africa trade promotion.
“If Africa is to integrate and improve the living standards of its people, we must use innovative financial solutions such as factoring and credit insurance, which offer keys to unlock the growth of small and medium-sized enterprises in Africa,” President Adesina stated.
He spoke on how finance and investments are at the very sharp end of economic transformation, pointing out that the Bank is opening another highway to African investment through the Africa Investment Forum (AIF), scheduled for 7-9 November 2018 in Johannesburg.
“The Africa Investment Forum, Africa’s investment marketplace, will provide a unique platform for investment negotiations, finance, transactions, and a marketplace for closing deals to accelerate the economic development of Africa.”