The African Export-Import Bank (Afreximbank) has signed a three-year $300 million revolving global credit facility agreement to provide financing to Export Trading Company (ETC) in a bid to support and promote intra-African trade.
The facility agreement, signed recently between Afreximbank and ETC, provides for the funds to be used to support ETC Group’s regional agricultural trade business and those of its subsidiaries across Africa.
The facility will, among other things, finance the sourcing, processing and transportation of soft commodities of African origin to markets and also to support procurement of key agricultural inputs, such as fertilizer, seeds and other chemicals, which would be supplied across the continent.
Afreximbank President Dr. Benedict Oramah said that deployment of the facility would address some of the key bottlenecks faced by African agricultural exporters, particularly small and medium-scale enterprises operating in agro-processing and light manufacturing sub-sectors, in effectively competing in international trade and increasing their participation in regional and global agricultural value chains.
According to him, it will also improve market access by allowing ETC to create linkages to regional and international markets by aggregating large volumes of agricultural produce that would be traded across regions.
The President described ETC Group as a catalyst for the growth of intra-African trade, noting that it was creating strong and reliable agricultural value chains across Africa by bringing agricultural produce from the farm gate to processing facilities and processed/manufactured goods to the market.
ETC Group, which was founded in Kenya in the 1960s but subsequently moved to Tanzania and now has its African regional headquarters in Mauritius, trades mainly in commodities, concentrating on fertilizer, maize, rice, oil seeds, cashew nuts, sesame seeds, pulses, wheat, cotton, coffee, and sugar. It has a footprint across 45 countries in Africa and overseas and operates an integrated agricultural value chain business model cutting across agronomy activities; sourcing at farm gate level; processing and other transformation activities; transport and logistics; and trading.
Afreximbank’s Intra-African Trade Strategy identifies facilitating the emergence and expansion of export trading companies as a quick way of accelerating the growth of intra-African trade.