Ghana International Bank (GHIB) has secured a US$50 million trade finance facility to stimulate intra-Africa trade in sub-Saharan countries, supported by British International Investment (BII). This initiative will facilitate business support and improve trade flows while addressing the credit shortage in frontier markets. Adansi, GHIB’s CEO, emphasized the role of this partnership in leveraging deep market knowledge for impactful transactions.
The Ghana International Bank (GHIB) has secured a trade finance facility valued at US$50 million aimed at enhancing intra-Africa trade across various sub-Saharan countries. This funding package encompasses nations such as Sierra Leone, Liberia, The Gambia, Benin, the Democratic Republic of Congo, Rwanda, and Tanzania, and is backed by the British International Investment (BII), the UK’s development finance institution.
Utilizing a Master Risk Participation Agreement (MPRA), the US$50 million facility will empower GHIB to provide additional support to businesses and streamline trade flows within the specified regions. This initiative addresses the prevalent lack of credit enthusiasm for frontier markets in Africa, stemming from elevated risk perceptions and lower transaction volumes.
Dean Adansi, CEO of GHIB, noted, “At GHIB, we believe our success over the last 65 years is rooted in a deep understanding of African risk. This partnership with British International Investment represents a viable path through which we can structure partnerships that leverage this deep knowledge of risk into profitable and impactful transactions.”
The increase in trade financing is expected to facilitate local firms in importing necessary commodities and equipment essential for their growth. This collaboration taps into GHIB’s extensive network, aiming to bridge the widening trade finance gap in African markets, particularly during tumultuous economic times.
BII’s involvement will provide crucial foreign exchange liquidity, essential for importing key goods in GHIB’s operating markets. Adansi remarked, “With this deal, we are employing a structure that uses our deep knowledge and access of the market, harnessed together with the superior scale and capacity of BII,” indicating the potential for significant economic growth through enhanced trade.
BII’s country director for Ghana, Kwabena Asante-Poku, emphasized the importance of trade, stating that many African nations have encountered tough economic conditions that undermine growth. “Trade remains a key driver of growth for African economies especially in frontier markets like Sierra Leone, Liberia, and The Gambia. Enhancing the flow of trade credit and financial intermediation to these markets will ensure access to essential goods and services, driving sustainable and inclusive economic growth,” Asante-Poku stated.
In conclusion, the Ghana International Bank’s partnership with British International Investment marks a significant step toward enhancing intra-African trade by addressing the financial challenges faced by frontier markets. This $50 million trade finance facility will empower businesses in underserved regions, fostering economic growth and providing essential resources for local companies. The collaboration exemplifies a strategic approach to overcoming barriers in trade finance, thereby paving the way for greater economic opportunities across sub-Saharan Africa.
Original Source: africanreview.com
