By BUUMBA CHIMBULU
African Export-Import Bank (Afreximbank) has commenced the review of more than US$2 billion worth of trade finance transaction for Zambian businesses.
This came to light after the recent visit of Afreximbank president Benedict Oramah with his delegation to Zambia, who among others met with President Hakainde Hichilema, financial institutions, corporate and some critical State Owned Enterprises (SOEs) that could potentially benefit from the Bank’s programme and facilities.
In giving highlights of what was discussed, Afreximbank regional chief operating officer in charge of Southern Africa Humphrey Nwugo indicated that the Bank was exploring opportunities to provide financing and other forms of support to eligible borrowers in Zambia as part of the broader support to the country.
He therefore, stated that president Oramah made know to the Head of State on the need to setup a battery manufacturing facility with the Democratic Republic of Congo (DRC), both of which countries contribute close to 80 per cent of global cobalt supplies.
Mr Nwugo pointed out that Cobalt was a major material needed for battery manufacturing, yet Zambia and DRC supply these to other countries for processing and manufacturing of batteries.
In response to a press query, he indicated that Afreximbank was promoting the setting up of these manufacturing structures under an Industrial Park model but with the two countries providing a common policy framework.
“In fact, president Oramah proceeded from Zambia straight to DRC to confer with the Head of State of the DRC on the same as part of his push for Africa to begin to create additional value from our own resources.
“We are pleased to report that both countries are committed to working with the Afreximbank in this regard. So, in a nutshell our focus areas were on fleshing out some of the huge pipelines and inquiries we have received from Zambia and explaining to the parties our lending principles as well as the programmes and facilities of the Bank to enable them understand how to structure their requests to meet the requirements of the Bank,” Mr Nwugo explained.
He said with a pipeline of over US$2billion trade finance transactions; it made sense that Afreximbank uses the opportunity of the visit to meet parities who could potentially benefit from the programme and facilities of the Bank.
“We met a number of commercial banks, some corporate as well as certain critical SOEs in Zambia. We were very pleased with the level of reception we got and are happy with the overall enthusiasm about the economic outlook of Zambia,” Mr Nwugo said.
He said they discussed with parties in the critical sectors of the economy, including mining and emphasised the need for some sort of value addition and beneficiation of the metals and minerals being mined out of Zambia.
“As you may be aware, Afreximbank is the Trade Finance Bank for Africa established to support both intra and extra African trade using three broad instruments – funding, unfunded (guarantees, insurance and advocacy) as well as advisory services.
“This visit enabled the team to provide details of how we operate using these instruments and we are pleased to report that the mission was very successful in this respect. The team was pleasantly surprised with some of the findings as Zambia is replete with yet untapped opportunities which the Bank shall potentially assist to unlock,” Mr Nwugo stated.
A team from the Afreximbank were in the country from December 13th to December 16, 2021.
Zambia records over $2bn trade finance
