UK’s Development Finance Institution, CDC Group, announces US$50m trade finance facility with Ecobank for Covid-19
Provides systemic liquidity and supports vital supply chains across Africa’s markets; Sustains and increases access to goods and services during the pandemic; Bolsters economic opportunities and inclusive growth, in markets such as Togo, Burkina Faso and Chad.
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 centre 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 realise 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.”