President of the African Export-Import Bank (Afreximbank) Nigeria’s Professor Benedict Oramah has stated that the bank is to invest $40 billion to boost trading activities within the African continent in the next five years.
Oramah who made the disclosure at the opening ceremony of the 2nd Intra-African Trade Fair in Durban, South Africa said that the move was in line with plans to establish and consolidate its own financial institutions.
“Trade agreements have worked in more mature markets because they have institutional mechanisms that support their implementation. Africa is beginning to build its own institutions. Afreximbank is one of them. That is why the Bank is unrelenting in its support for the AfCFTA.
“For instance, we have committed to disbursing 40 billion US dollars to support intra-African trade over the next five years, building on the 20 billion US dollars disbursed in the past five years.
“We are also providing Letters of Credit Confirmation lines to African commercial banks to support cross-border trade. It is our aim to onboard 500 banks with aggregate lines of over 8 billion US Dollars.”
He also used the occasion to highlight some of the successes recorded by Afreximbank.
“The Bank has so far onboarded nearly 480 and is today the Bank with the widest messaging links with African Banks. Working with the AU and the AfCFTA Secretariat, we have created a Pan-African Payment and Settlement System (PAPSS) to facilitate cross-border payments in national currencies.
“The System, which is currently piloting in the West African Monetary Zone (WAMZ), will strengthen national currencies, integrate Africa’s payment infrastructure, and save the continent about 5 billion US dollars in transfer charges. Above all, it will return to Africa, large volumes of trade diverted away from the continent due to currency issues.
“Afreximbank is supporting the pilot in an amount of 500 million US dollars and expects to expand this to 3 billion US dollars when fully adopted across Africa. We have created a Trade Information Portal that will complement the Trade Fair in availing information about market and investment opportunities across Africa. This Artificial Intelligence-enabled System will help develop predictable supply chains and enhance connectivity among African businesses,” he said.
Professor Orama informed participants that the bank was also stimulating production in the manufacturing and agricultural sectors.
“We have created the Fund for Export Development in Africa to support manufacturing, particularly light manufacturing, and agro-processing, by facilitating access to equity finance.
“In partnership with the AU, the AfCFTA Secretariat, and other partners, we have created this 20 million US dollar biennial Intra- African Trade Fair that will help improve business to business connectivity in Africa. The Bank is also working with several African Governments to create and or expand Industrial Parks (IPs) and Special Economic Zones to address the infrastructure bottlenecks to industrialization. Projects in the aggregate amount of about 1.2 billion US dollars have been implemented or underway across ten countries,” he said.
President of the African Development Bank, Dr Akinwumi Adesina no foreign investor can succeed without doing business in Africa.
He said the Africa Continental Free Trade Area would soon become a force to be reckoned with globally.
Adesina, who addressed the gathering virtually, said, “Investors know: if you’re not in Africa, you’re not in business. They know that with over 50 countries harmonizing tariffs, rules and standards, the Africa Continental Free Trade Area will soon become the largest free trade area in the world since the establishment of the World Trade Organization.
“I wish to take this opportunity to commend AFREXIMBANK, the African Union, and the Africa Continental Free Trade Area Secretariat for organizing the 2nd edition of the Intra-Africa Trade Fair. I would also like to express my immense appreciation to the Intra-Africa Trade Fair leadership; especially President Obasanjo, Chair of the Intra-Africa Trade Fair Advisory Council, President Oramah of Afreximbank, and Secretary-General Wamkele. This is the right event at the right time.”
He noted that the trade fair holding in Durban would provide an opportunity for more integration among African countries, giving the vast potentials on the continent.
“The Intra-Africa Trade Fair brings together regional development finance institutions, multilateral development banks, policymakers, traders, and investors. Basically, Africa’s entire development, trade and investment community is here to explore policy gaps in infrastructure, trade and regional integration.
“The 2nd edition of the Intra-Africa Trade Fair offers an exceptional platform to negotiate deals and agree on the steps required to promote intra-regional trade and accelerate the operationalization of the Africa Continental Free Trade Area.
“The Africa Continental Free Trade Area will create a market of 1.3 billion people and drive a combined gross domestic product of $3.3 billion. The size of consumer and business expenditures in Africa will rise to $6.7 trillion by 2030.” Adesina said. (VON)