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ECOWAS Bank Secures $50m, €50m Trade Finance Credit From AfDB

(AFRICAN EXAMINER)- ECOWAS Bank for Investment and Development (EBID), has secured a dual-currency Trade Finance Line of Credit comprising $50 million and €50 million from the African Development Bank (AfDB) Group.

The Transaction Line of Credit as approved by the AfDB’s Board of Directors, is aimed at enhancing food security and boost agricultural value chains in the region.

An additional co-financing of $30 million for the credit line will come through the Africa Growing Together Fund (AGTF) from the People’s Bank of China (PBOC).

EBID is the financial arm of ECOWAS comprising 15 Member States. Established in 1999 as a legal entity, it operates through two windows, namely private sector operations and public sector operations.

Its member countries are Benin, Burkina Faso, Cape Verde, Côte d’Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo. It contributes to attaining the objectives of ECOWAS by supporting infrastructure and other projects to promote regional integration.

EBID will use the three-and-a-half-year facility to provide direct financing to local corporates. Part of the facility will also be channelled through select local banks for on-lending to key sectors such as agriculture, infrastructure, and transport.

The ultimate beneficiaries will be Small and Medium-sized Enterprises (SMEs), local enterprises cooperatives and farmers in the West Africa region.

AfDB’s Deputy Director General for the West Africa Region, Joseph Ribeiro said regional development finance institutions like EBID are key partners of the AfDB Group and serve markets and client segments critical to the overall development of the continent.

“They play an important role in promoting trade and regional integration. This is the Bank’s first financing support to EBID, and we look forward to an even stronger partnership in the near future”, he said.

Similarly, the Bank’s Head of Trade Finance, Lamin Drammeh also stressed the critical need for such support in the region. “We are excited to work with EBID to increase access to trade finance in the ECOWAS region with a special focus on the agriculture value chain, SMEs and women-owned businesses”, he added.

Regional institutions like EBID, according to him, complement the Bank’s efforts to bridge the trade finance gap in Africa and serve as an effective conduit for channeling much-needed funds to underserved countries and sectors.

Meanwhile, the AfDB estimates the annual trade finance gap for Africa to be around $81 billion.  Compared to multinational corporates and large local corporates, SMEs and other domestic firms have greater difficulty in accessing trade finance.

Short URL: https://www.africanexaminer.com/?p=84980

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