Afreximbank boosts African businesses with $15m bankability project facility

The African Export-Import Bank (Afreximbank) has launched a $15 million project preparation facility aimed at increasing the availability of viable well-prepared projects in Africa and at making such projects bankable and attractive to investors.

The Afreximbank Project Preparation Facility (APPF), launched in Johannesburg, South Africa on the sidelines of the Africa Investment Forum, would provide technical and financial support to early stage companies in the preparation

and development of projects from conceptual stage to bankability stage and the point at which such projects can attract interest from equity investors and debt financiers.

Afreximbank had set up the APPF with an initial seed capital investment of up to $15 million.

The Director of Communications and Marketing, Mr. Obi Emekekwue, stated on Wednesday that the Afreximbank President, Prof. Benedict Oramah, said that the facility would support transactions that sought to implement logistical platforms that supported export growth and diversification, or facilitated the assimilation of African commodities into global value chains.

This, Prof. Oramah said, will increase the volume and flow of tradeable goods and services along Africa’s trade corridors.

According to Oramah, the facility supports the Afreximbank’s mandate and strategy which seeks to promote intra-African trade, and industrialisation and export development activities in the continent.

Also speaking, Tshepo Mahloele, Chief Executive Officer of Harith General Partners, a leading pan-African infrastructure developer, lauded the APPF as “a bold step in the right direction to assist Africa to unleash its full potential through de-risking of investments early on in the project preparation cycle”.

Mr. Mahloele, who noted that the project preparation step was often overlooked in the pursuit of quick returns, said that Harith had ensured efficient and professional preparation of infrastructure projects.

According to him, Africa has long been at the mercy of poor planning, leading to infrastructure project backlogs that has limited GDP growth by at least 2 per cent per annum.

“Afreximbank’s intervention will complement ongoing project preparation initiatives and culminate in shortening the project preparation cycle, thereby fast-tracking Africa economic development”, he said.

Zitto Alfayo, Manager, Project Finance, said that the APPF would be operated on full cost recovery basis and would be primarily open to African governments, public-private partnerships and private corporates.

The specific sectors of intervention were activities related to development of logistical platforms, such as industrial parks, value added projects supporting manufacturing and services exports, tradeable services, ICT and trade enabling infrastructure encompassing energy, transport and logistics sectors.

Also participating in the launch ceremony from Afreximbank were Kofi Adomakoh, Director, Project Finance; Vitalis Ekene, Special Assistant to the President on Banking and Special Initiatives; and Ayo Mubarak of the Project Finance and Export Development Department.

The African Export-Import Bank (Afreximbank) is the foremost pan-African multilateral financial institution devoted to financing and promoting intra- and extra-African trade. The Bank was established in October 1993 by African governments, African private and institutional investors, and non-African investors.

Its two basic constitutive documents are the Establishment Agreement, which gives it the status of an international organisation, and the Charter, which governs its corporate structure and operations.

Since 1994, it has approved about $60 billion in credit facilities for African businesses, including about $8.5 billion in 2017.

Afreximbank had total assets of $11.9 billion as at 31 December 2017 and is rated BBB+ (GCR), Baa1 (Moody’s), and BBB- (Fitch).