Business and Economy

African Trade Insurance Agency admits NEXI Japan as New Shareholders

Nippon Export and Investment Insurance (NEXI), a Japanese export credit agency, has joined the Pan-African Guarantee Institution and became the newest stakeholder of the African Trade Insurance Agency (ATI). Under the auspices of the Tokyo International Conference on African Development (TICAD), this equity investment strengthens the long-standing and steadily expanding partnership between Africa and Japan, with ATI and NEXI supporting Japanese commerce and Foreign Direct Investment (FDI) into Africa.

Greeting the Chief Executive Officer of NEXI ATI I warmly congratulate NEXI for becoming the newest institutional stakeholder of ATI, according to a quote from Manuel Moses. I am pleased that our strategic partnership has resulted in NEXI’s equity investment in ATI as a shareholder. ATI and NEXI have maintained a solid working relationship in recent years toward fostering trade and investment between Japan and Africa under the auspices of TICAD. We are confident that as Japan increases its foreign direct investments (FDIs) and presence in Africa, its membership in ATI will not only strengthen our organization’s ability to support trade and investment across the continent but will also draw more Japanese investors looking for business opportunities in Africa’s population of over 1.2 billion people in the single market, under the AfCFTA.

The two organizations announced the opening of a “Japan desk” in ATI’s Nairobi office to support commercial and developmental projects in Africa so that Japanese businesses can easily access the trustworthy risk mitigation solutions offered by ATI during the 2019 TICAD7 Summit held in Japan. With an active gross exposure of USD 1.1 billion in the information & communication, financial & insurance, and construction sectors in Côte d’Ivoire, Egypt, Ethiopia, and Nigeria, the “Japan desk” has pushed support for both Japanese and African industry to date.

The fact that NEXI owns shares in ATI and has a strategic presence in Africa as an investor gives Japanese financial institutions and potential investors who are looking for business prospects on the continent comfort. We are certain that this membership will significantly benefit both parties as Japan continues to increase its presence in Africa, giving ATI more ability to support critical deals and encourage economic growth throughout the continent.

Recently, the Japan Desk Initiative supported a strategic development project; a 10-year Foreign Direct Investment Risk Insurance cover was provided by ATI to Japan’s Sumitomo Corporation on its investment in a new telecommunications company in Ethiopia – Safaricom Telecommunications Ethiopia Plc (STE), where NEXI provided ATI with reinsurance support. One of the single greatest Japanese Foreign Direct Investments (FDI) in Africa, and notably Ethiopia, is the project.

A portion of Japan’s private sector has recently received insurance protection from ATI against the risk of non-payment on transactions worth USD 4.9 billion. Some of this finance has assisted African nations in refinancing their short-term, expensive foreign and domestic loans into longer-term obligations with more manageable debt servicing costs. As soon as membership is complete, ATI anticipates assisting a large number of Japanese exporters, manufacturers, merchants, and financial institutions looking for commercial possibilities and market access throughout Africa in the upcoming years.

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