The CDC Group, the UK’s Development Finance Institution and impact investor has announced a US$50 million trade finance facility for Ecobank International (EBI SA), the Paris based member of the Ecobank Group. This marks CDC’s first partnership with EBISA with the commitment aimed at providing systemic liquidity to underserved markets and crucial trade finance support to local banks and businesses across Africa.
The Covid-19 crisis has had a significant adverse effect on trade flows, business operations and jobs in Africa’s markets. This CDC facility will support the continent’s economic recovery and is expected to generate between US$70 – $140 million in additional trade annually. The investment will enhance the import of essential goods, commodities and capital equipment, while also helping to expand access to goods and services in general.
EBI SA, the international subsidiary of Togo-based Ecobank Group, is an ideal partner to boost CDC’s impact across Africa and help strengthen financial support for local banks and the businesses that they serve. With the Ecobank Group’s extensive footprint and operations across 33 countries on the continent, the facility will broaden economic opportunities and inclusive growth, particularly in markets such as Togo, Burkina Faso and Chad.
The trade finance risk-sharing facility will meet the liquidity needs of local African banks at a crucial time especially with the economic impact of the pandemic. By committing capital to address these shortfalls, CDC is taking on additional risk and providing further credit support and trade finance lines to local banks, thus protecting commerce across the continent. The facility contributes to the UN Sustainable Development Goals Zero Hunger (SDG 2) and Decent Work and Economic Growth (SDG 8).
Admir Imami, Director, Head of Trade & Supply Chain Finance, CDC Group, said: “Our partnership with Ecobank presents an opportunity for CDC to provide trade support where it is most needed. Keeping trade flowing across the continent is a key objective in CDC’s Covid-19 response, and we are thrilled that our patient capital can support businesses that are at the center of economic activities in our markets. We remain committed to playing our part in closing the trade finance gap in Africa, by helping to facilitate business and job growth, and building resilience for the long term.”
Akin Dada, Ecobank Group Executive Corporate and Investment Banking, said: “Our partnership with CDC to enhance finance and capacity comes at a crucial time in Africa’s history with much-needed recovery from the challenges of Covid-19 and the immense trade and investment opportunities being created by the African Continental Free Trade Area. We welcome the opportunity to work with development finance institutions such as CDC to help realize Africa’s potentials and sustainably drive its economic development.”
Jean Erwin NIZET, Ag. Managing Director at EBI SA, said: “This partnership with CDC will allow EBI SA to provide further support for African trade. In this challenging Covid-19 environment, this represents an important step in increasing Ecobank’s trade capacity and better serve its clients in Africa. This will ensure that Ecobank continues to contribute to the creation of value and sustainable growth across the continent.”
CDC Group is the UK’s impact investor with over 70 years of experience of successfully supporting the sustainable, long-term growth of businesses in South Asia and Africa. The company is a leading player in the fight against climate change and has committed more than $1bn of climate finance over the last four years. It is also a founding member of the 2X challenge which has raised $10bn to empower women’s economic development. The company has investments in over 1000 businesses in emerging economies and total assets of $9.3bn. In 2020, CDC committed over of $1.5bn to businesses in Africa and Asia and aims to invest up to $1.75bn in 2021 – with a focus on driving inclusive growth, job creation and supporting economic recovery from COVID-19. It is funded by the UK government and is a champion of the UN’s Sustainable Development Goals. All proceeds from CDC’s investments are reinvested to improve the lives of millions of people in Africa and South Asia.
Ecobank Transnational Incorporated (‘ETI’) is the parent company of the Ecobank Group, the leading independent pan-African banking group. It employs over 14,000 people and serves about 29 million customers in the consumer, commercial and corporate banking sectors across 33 African countries. The Group has a banking license in France and representative offices in Addis Ababa, Ethiopia; Johannesburg, South Africa; Beijing, China; London, the UK and Dubai, United Arab Emirates. Ecobank International (EBI SA) is a banking subsidiary of ETI established in 2008 to capture cross-border flows between sub-Saharan Africa and the rest of the world, build a stronger relationship with international financial institutions and corporate customers and centralized Group affiliates with EUR and USD denominated deposits and FX hedging needs. ETI is listed on the Nigerian Stock Exchange in Lagos, the Ghana Stock Exchange in Accra, and the Bourse Régionale des Valeurs Mobilières in Abidjan.
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