The African Export-Import Bank (Afreximbank) has entered into an agreement with the Export Development Bank of Egypt (EBE) to provide it with a $500m scheme in order to support Egyptian exports to and investments in African countries, according to an Afreximbank press release.
The Export Credit Support Scheme (ECSS), signed on the sidelines of the Africa 2017 Forum taking place in Sharm El-Sheikh, is a combination of programmes, products, and services offered by Afreximbank to protect against the risk of non-payment of loans or advances granted to exporters to meet short or medium-term export contracts.
Moreover, the agreement’s beneficiaries must be Egypt-based exporters, and the products must be of Egyptian origin while the importers must be African and located in one of Afreximbank’s member countries.
The ECSS would assist Egyptian exporters develop their industries and boost their exports into other African countries, thereby enabling the exporters to compete on near-equal footing with exporters from more developed economies, said Benedict Oramah, president of Afreximbank.
He added that the agreement will boost industrialisation and intra-African trade, in line with Egypt’s development objectives and would further deepen Afreximbank’s relationship with Egypt and the Egyptian financial sector.
On the other hand, Mervat Soltan, chairperson of EBE said that her institution has a long experience in promoting trade links between Egyptian businesses and their African counterparts, adding that it would bring that experience to implementing the new scheme.
Furthermore, the scheme will provide support for the Export Credit Guarantee Company of Egypt, in which the EBE holds majority ownership, to partially cover and share transaction risk. It will also provide assistance to Egyptian export promotion councils and business associations to undertake export promotion activities for Egyptian products and commodities in African countries.
The scheme would also assist in providing market information and advisory services to Egyptian exporters and support the organisation of intra-African trade fairs and exhibitions, as well as provide networking opportunities and twinning services through the facilitation of contract awards by African governments to large Egyptian exporters and support of partnerships among “actors” in intra-African trade.