Prof. Benedict Oramah describes how Africa’s premier multilateral development institution is working in tandem with other continental organisations to rescue the continent’s SDGs and ensure that it is on the correct course for success.
For 30 years, the African Export-Import Bank (Afreximbank) has been an advocate for African solutions to Africa’s problems by creating and deploying innovative solutions to eliminate barriers to the attainment of Africa’s developmental aspirations.
Created with a mandate to promote intra-African trade, Afreximbank is working in partnership with the AU and the African Continental Free Trade Area (AfCFTA) Secretariat to reverse the commodity and market concentrations that have historically stalled Africa’s development, especially due to the commodity dependency trap.
Fundamentally, the Bank’s interventions in support of its member states are in alignment with AU’s Agenda 2063 and the United Nations Sustainable Development Goals (UN SDGs).
For instance, at the onset of the Covid-19 pandemic, in addition to about $8bn disbursed to African governments, banks, and corporates under its Pandemic Trade Impact Mitigation Facility (PATIMFA) that helped to mitigate economic and health impacts of the pandemic, the Bank supported a pooled procurement of 40m doses of the Johnson and Johnson Covid-19 vaccines through a $2bn Advanced Procurement Commitment (APC) Guarantee Facility that provided coverage to 30% of Africa’s population.
Similarly, when the Ukraine crisis broke in March 2022, exacerbating the continent’s economic challenges, Afreximbank stepped up and launched a $4bn Ukraine Crisis Adjustment Trade Financing Programme for Africa (UKAFPA) that has helped African countries to meet immediate grains, fertilisers and fuel import price increases while helping to improve access to critical imports into Africa.
In response to the food security challenge on the continent heightened by geo-political conflicts, the Bank, working with UNECA, created the African Trade Exchange (ATEX), a platform that is already connecting buyers and suppliers of scarce agricultural commodities and fertilisers arising from the Ukraine conflict.
In the long run, ATEX will facilitate the smooth integration of regional suppliers into the continent’s supply and value chains, vital for trading under the AfCFTA.
In keeping with SDG 17, Partnerships for the goals, and SDG 9, Industry, Innovation, and Infrastructure, Afreximbank has staked $6bn in development financing to strengthen Africa’s food security prospects.
The Bank has also released more than $700m to support the development of special economic zones and industrial and agro parks in a number of African countries. These parks are critical tools to fast-tracking industrialisation and infrastructure development essential for the successful implementation of the AfCFTA.
Eliminating financial borders
Being at the forefront of the implementation of the AfCFTA, Afreximbank, collaborating with the AfCFTA Secretariat and the African Union, has created a number of initiatives that will facilitate the smooth implementation of the Agreement.
The Pan African Payment and Settlement System (PAPSS), which will facilitate instant cross-border payments in African currencies, will save the continent about $5bn in transaction costs annually.
PAPSS was devised to eliminate Africa’s financial borders, formalise and integrate Africa’s payment systems, and play a major role in expanding intra-African trade. Other initiatives include a Customer Due Diligence platform, also known as MANSA, and the trade information and regulatory portals.
Supporting the sustainable development of the whole of Africa is at the heart of Afreximbank’s mandate and strategy. The Bank’s strategy is focused on delivering AU’s Agenda 2063 and the UNSDGs, which it drives through forging alliances and partnerships.
Rescuing the SDGs in Africa
The UN Sustainable Development Goals (SDGs) are a comprehensive set of global goals to end poverty, protect our planet, and improve the living conditions of the global population. This article appeared in a special edition of New African guest-edited by Antonio Pedro, Acting Executive Secretary of the UN Economic Commission for Africa, that assesses where Africa is in obtaining these crucial goals. To access more articles click here.