Afreximbank commits $100m to support export, businesses in Africa

Mathew Dadiya, Abuja

African Export-Import Bank (Afreximbank) has committed a total sum of $100 million to support export, and develop African businesses. The operationalization of the newly-created Fund for Export Development in Africa (FEDA) moved into high gear with the holding of the pre-incorporation meeting of the Board of Directors in Cairo, which led to the injection of $100 million into the fund by the African Export-Import Bank (Afreximbank). FEDA, a wholly-owned development-oriented subsidiary of the Afreximbank, has been set up to implement the Bank’s Equity Investment Programme by providing seed capital to companies in Afreximbank’s key focus sectors, including agri-business; manufacturing; consumer and retail; financial services; technology; travel and tourism; transport and logistics; and industrial parks. It will invest across all market segments but will have its greatest focus on small and medium-sized enterprises. The Director, Global Communications and Marketing, Obi Emekekwue on Sunday, stated that the long-term objective of FEDA is the provision of equity capital and related financial, non-financial and support services to operators in Africa’s tradable and support sectors, with emphasis on activities that support intra-African trade and value-added exports. Addressing the pre-incorporation meeting, Prof. Benedict Oramah, Chairman of the Board of Directors of FEDA and President of Afreximbank, said that the fund would expand Afreximbank’s offerings to include vital equity investments that would boost intra-African trade. FEDA has been set up to implement the Bank’s Equity Investment Programme by providing seed capital to companies in Afreximbank’s key focus sectors, including agri-business; manufacturing; consumer and retail; financial services; technology; travel and tourism; transport and logistics; and industrial parks. It will invest across all market segments but will have its greatest focus on small and medium-sized enterprises. The long-term objective of FEDA is the provision of equity capital and related financial, non-financial and support services to operators in Africa’s tradable and support sectors, with emphasis on activities that support intra-African trade and value-added exports. The Fund, which has been set up with an initial $100-million commitment, will also seek to leverage on the role Afreximbank has played in mobilising trade finance into Africa to also mobilise foreign direct investment (FDI) into the continent. Also, speaking at the meeting, Chief Executive Officer (CEO) of FEDA, said that a feasibility study conducted for Afreximbank had identified a funding gap which was inhibiting intra-African trade. FEDA had, therefore, been set up to provide equity and to leverage FDI to help close that gap. He announced that FEDA would start investment activities in 2019, with a target to invest $10 million during the year. It was also targeting to raise $450 million in FDI during the period.