Business
BRITISH International Investment (BII), a UK’s Development Finance Institution (DFI) has announced a 60 million dollars trade finance facility for Access Bank and five of its other Pan-African subsidiaries.
The bank’ s Spokesman, Mr Abdul Imoyo, said this in a statement on Tuesday in Lagos.
Imoyo said BII, also an impact investor partnership with Access Bank, would strengthen import and export capabilities amongst local businesses and plug the foreign currency supply gap.
He explained that the programme supports Access Bank’s strategy to enable continental trade and deepen BII’s commitment to bolstering financing environments in fragile economies.
“BII estimates the loan programme will stimulate African trade volumes by 90 million dollars.
“The agreement reinforces BII’s ongoing relationship with Nigeria’s largest commercial bank by assets.
“It facilitates the provision of systemic liquidity during a period characterised by a challenging macroeconomic environment,” he said.
He said higher inflation and rising cost of capital had placed downward pressure on currency performance, both domestically and in the programme’s target markets.
Imoyo listed the programme target market to include: the Democratic Republic of Congo(DRC), Mozambique, Rwanda, Sierra Leone, and Zambia.
According to him, intervention at this critical juncture underlines the key role of BII, and development finance institutions in general, in extending countercyclical support to build economic resilience.
“Between 80 per cent and 90 per cent of world trade is estimated to rely on the availability of trade credit, according to the World Trade Organisation.
“Prior to the COVID-19 pandemic, that financing gap stood at 82 billion dollars in Africa, and it is increasing.
“Recognising the positive ripple effects of robust trade flows on economies and livelihoods, Access bank is aiming to provide 15 per cent of trade finance across Africa, by growing the trade books of its subsidiaries,” he said.
According to him, currency instability in Nigeria can hinder the wider proliferation of dollar denominated trade loans across African markets.
Imoyo noted that this also constrains countries’ ability to capitalise on opportunities opening up under the African Continental Free Trade Agreement.
He said: “by specifically targeting import dependent economies, many of which will mark the first engagement with BII’s Trade programme.
“The improved availability of US dollar denominated trade loans will ensure availability of key commodities and manufacturing inputs for the production and export of goods.
Imoyo stated that the key outcome will be improving livelihoods and preserving jobs for the employees of importers and exporters with limited access to foreign exchange trade loans.
The spokesman said, with the loans channelled into companies in construction, manufacturing and FMCG, the programme would directly contribute to the UN Sustainable Development Goals eight and nine.
Imoyo stated that the facility would improve inclusion, which qualifies under the ‘2X Challenge’, aimed at strengthening female participation and leadership in business.
Imoyo said the bank would ensure that the allocation of loans was designed deliberately to advance its gender commitments.
“In addition, the facility will contribute to BII’s BOLD programme, dedicated to enhancing the availability of finance at more affordable rates to black, African-owned businesses,” he said.
In his remark, Mr Seyi Kumapayi, Executive Director, African Subsidiaries, Access Bank, said that the bank was on a purposeful mission to scale intra-African trade and position the continent as a viable market for global trade.
Kumapayi expressed delight on the tremendous potential that the trade finance facility with the BII affords the bank across its pan-African subsidiaries.
He noted that the strategic collaboration, not only strengthens the bank’s import and export capabilities but also expands its resources to support local industries, especially women-owned businesses, to drive economic growth.
“By stimulating trade volumes, we will be playing a key role in fostering long-term economic resilience for the continent, while increasing attractiveness for increased foreign investments,” Kumapayi said.
Commenting, Mr Admir Imami, Director/ Head, Trade and Supply Chain Finance at BII, said Access Bank had been a long-standing partner of BII.
Imami stated that the companies new partnership was a significant step closer to narrowing the trade finance gap in Africa, particularly in countries such as the DRC and Rwanda.
He said, “Access to finance in fragile states is hugely constrained. Often these countries are buffeted by macroeconomic events far beyond their control.
“BII and Access Bank share a conviction that building the resilience of these businesses by ensuring affordable access to foreign exchange is vital to keep intra-African trade moving and support the growth of inclusive economies.
Mr Benson Adenuga, BII’s Head of Office and Coverage Director for Nigeria, said BII’s latest commitment to Access Bank reiterated its assurance to the leading multinational institution and to Nigeria.
Adenuga noted that the partneship comes at a time when Nigeria’s fragile economic situation needs additional funding, particularly from counter cyclical investors like development finance institutions.
“Our funding will help bolster the economy and ensure the availability of staple goods, medicines and food across Africa,”he said.
Access Bank plc, is a leading full-service commercial bank operating through a network of more than 700 branches and service outlets, spanning in three continents, 20 countries and serving over 60 million customers.
British International Investment is an investment partner to businesses in Africa, Asia and the Caribbean.
Itinvests to support the UK Government’s Clean Green Initiative and to create productive, sustainable and inclusive economies in our markets.(NAN)
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October 3, 2023 @ 20:44 GMT|
Tags: Abdul Imoyo
