African Export and Import Bank (Afreximbank) has disclosed plans to double its financing for intra-African trade to $40 billion on a revolving basis by 2026, up from $20 billion in 2021.
At the Nigeria Intra African Trade Fair (IATF) 2023 High Level Business Road Show in Lagos, yesterday, Executive Vice President, Intra-African Trade Bank, Kanayo Awani, said Afreximbank was working with the AfCFTA Secretariat to put in place the AfCFTA Adjustment Fund to facilitate and provide support through financing, technical assistance, grant and compensation to state parties and private enterprises to effectively participate in the AfCFTA.
She said AfCFTA has been signed by 54 of the 55 AU member states and ratified by 47 African State parties.
According to her, the board of Afreximbank has approved $ 1 billion to support the funding of the initiative and another $10 million grant to facilitate the establishment and operationalisation of the adjustment fund.
Awoni stated that although AfCFTA is expected to serve as the bedrock for deeper economic integration and economic emancipation it would pave the way for increased investment in productive sectors, enhance trade linkages between African member states and drive the structural transformation of the continent.
However, she noted that its success requires not just a legal framework for liberalising trade but a deliberate action to connect African markets, exchange information and facilitate the movement of goods and payments for such goods.
She added that innovative financial instruments that would also help reduce reliance on primary commodities and develop industrial and technological capacity that will drive sustainable development are also imperative.
To further facilitate intra-African trade, Awani said the bank has created an African Trade Facilitation Programme (AFTRAF) and established partnerships with around 500 of Africa’s 600 commercial banks, the single largest network globally to help forge stronger partnerships with African commercial banks to help finance intra-African trade.
With this, Awoni said the bank has concluded plans to grant about $8 billion in Letters of Credit (LCs) confirmation lines to these banks.
