By Temitope Ponle
The Board of Directors of the African Development Bank (AfDB) Group has approved a 50-million-dollar Risk Participation Agreement (RPA) for Natixis, a French Bank.
This is contained in a statement by Fahd Belbachir, Senior Communications and External Relations Officer for North Africa, AfDB.
The agreement would enable Natixis to support African banks and their small and medium-sized enterprise (SME) clients to undertake more regional and international trade.
Also, the agreement was expected to help achieve a cumulative trade volume of 430 million dollars over the next three years.
Mohamed El Azizi, Director-General, AfDB, North Africa said the bank was strengthening the relationship among the different stakeholders in the African banking system.
“With this new operation, we are strengthening the trusting relationship between the various players in the African banking system in order to accelerate the development of trade.
“This is another step toward the realisation of the African Continental Free Trade Area which will unleash the full growth potential of the continent and create new opportunities and jobs.”
Also, Stefan Nalletamby, Director, AfDB’s Financial Sector Development Department said the bank’s ambition was to help more local banks and their SMEs expanded to new African countries.
“This new operation, the second of its kind with Natixis, and with broader geographic coverage, will help catalyse greater intra-African trade flows over the next three years.
“The ambition is to help more local banks and their SME clients to expand into new African countries, particularly those with low incomes
“The aim is to facilitate their access to financing and help them unleash their potential. This is in the service of greater regional integration.”
According to the statement, the risk-sharing agreement is intended to meet the growing demand from African markets for trade finance in vital economic sectors such as agribusiness, energy, manufacturing, health, and services.
It would also help diversify production, creating jobs and additional tax revenues for several African countries.
Furthermore, the agreement would support African commercial banks and SMEs to ensure stable access to trade finance.
Also, RPA aligned with the AfDB’s High five strategic priorities. (NAN)
