Board of Directors of the African Development Bank Group has approved a dual-currency Trade Finance Line of Credit for ECOWAS Bank for Investment and Development (EBID).
The approve comprise of $50 million and EUR 50 million and an additional co-financing of $30 million for the credit line which will come through the Africa Growing Together Fund (AGTF) from the People’s Bank of China (PBOC).
The ECOWAS Bank for Investment and Development will use three and half year facility to provide direct financing to local corporates.
Also, part of the facility will be channelled through selected local banks for on-lending to some key sectors like agriculture, infrastructure, and transport.
However, Small and Medium-sized Enterprises (SMEs), local enterprises cooperatives and farmers in the West Africa region will be the ultimate beneficiaries.
Deputy Director General for the West Africa Region, Joseph Ribeiro added, regional development finance institutions like EBID are key partners of the African Development Bank and serve markets and client segments critical to the overall development of the continent.
“They play an important role in promoting trade and regional integration. This is the Bank’s first financing support to EBID, and we look forward to an even stronger partnership in the near future,” he said.
Also, Bank Head of Trade Finance, Lamin Drammeh, highlighted the critical need for such support in the region. “We are excited to work with EBID to increase access to trade finance in the ECOWAS region with a special focus on the agriculture value chain, SMEs and women-owned businesses”, he said.
“Regional institutions like EBID complement the Bank’s efforts to bridge the trade finance gap in Africa and serve as an effective conduit for channeling much-needed funds to underserved countries and sectors”, he added.
The African Development Bank estimates the annual trade finance gap for Africa to be around $81 billion.