African Export–Import Bank, also referred to as Afreximbank, is a pan-African multilateral trade finance institution created in 1993 under the auspices of the African Development Bank. It is headquartered in Cairo, Egypt. Afreximbank's vision is to be the trade finance bank for Africa. Afreximbank's mission statement is: "To stimulate a consistent expansion and diversification of African trade, to rapidly increase Africa's share of global trade, and in doing so, to operate as a first-class, profit-oriented, socially responsible financial institution and a 'Centre of Excellence in African Trade Matters.'” Afreximbank's mandate is to finance and promote intra- and extra-African trade using three broad services:
Credit
Risk Bearing
Trade Information and Advisory Services
Afreximbank has 50 African member-countries. As of June 2020, the bank had four regional locations and is in the final stages of establishing a fifth regional office for Central Africa. The regional offices are:
Harare: managing the southern African countries
Abidjan: managing francophone western and central African countries
Abuja: managing anglophone western African countries
Kampala: managing the counties in eastern Africa
Yaounde: managing the countries in Central Africa.
History
Afreximbank was established in 1993. The agreement establishing the bank was signed by member states in Abidjan on 8 May 1993 and conferred the bank the status of an international organization with full juridical personality under the laws of the participating states. Under the agreement, participating states grant to the bank in their territories, certain immunities, exemptions, privileges, and concessions to facilitate the bank business in those territories.
Afreximbank charter
The Afreximbank charter was adopted in Abuja, Nigeria, on October 1993, and its provisions regulate the bank as a corporate body. Afreximbank works with African and non-African export credit agencies, development finance institutions, commercial banks and other multilateral institutions to support trade finance activities in Africa. Afreximbank began with a start-up raised capital of US$750 million in 1993, but the authorized share capital of the bank was increased to US$5 billion on 8 December 2012.
Shareholding structure
, the bank's shareholders, totaling 146, were divided into four categories:
Class "A" Shareholders - African governments, African central banks, African development banks and African economic organisations.
Class "B" Shareholders - African private investors and African national financial institutions.
In October 2019, Afreximbank postponed its planned IPO, valued at US$250 million at the London Stock Exchange, citing ‘unfavourable market conditions’..
MANSA
Afreximbank has partnered with the African Development Bank, African Central Banks, and other international and national strategic partners to launch MANSA, a collaborative CDD/KYC information repository platform with a special emphasis on African financial institutions and corporate to enable global institutions, partners and counter-parties to access African entities’ CDD profiles and information as well as leverage the platform to conduct customer due diligence on African entities; financial institutions, corporate and SME.
Intra African Trade Fair (IATF)
In December 2018, Afreximbank held the First Intra-African Trade Fair which took place in Cairo, Egypt. IATF2018 attracted more than 1,000 exhibitors from 45 countries and across 20 sectors, generating over $32 billion in deals, some of which Afreximbank has already financed. The IATF provides a platform for businesses to share trade, investment, and market information and for buyers and sellers, investors and countries to conclude business deals. The second Intra-African Trade Fair will take place in Kigali from 01-07 September 2020, targeting the execution of intra-African trade deals worth more than $40 billion.
Trade Facilitation Programme
Afreximbank launched its Trade Facilitation Programme in August 2018 to African banks.
FEDA
Afreximbank has established FEDA, the Fund for Export Development in Africa, as a subsidiary that will catalyze foreign direct investment flows into Africa's trade and export sectors. Afreximbank's equity investment is expected to aim to drive four times that amount of FDI. FEDA will provide investors with the same protections, immunities and privileges available to the Afreximbank and will also give them access to tax privileges and incentives. The fund will, furthermore, make it possible for more financing to come to Africa through the expansion of its guarantee offering, including the Intra-African Investment Guarantee Facility.
AFTRAF
The Afreximbank Trade Facilitation Programme was introduced in 2018 to enhance the confidence of counterparties in the settlement of international trade transactions and to improve correspondent banking relationships. It supports critical imports into Africa, boosts intra-African trade, and facilitates the purchase of equipment for the production of export goods. It provides trade confirmation services, trade confirmation guarantees, and irrevocable reimbursement undertakings. It is designed to counter the reduction or withdrawal of trade lines to African banks by international banks. It enables local banks to meet international compliance requirements and use the trade confirmation guarantee facility to expand their correspondent banking relationships.
FECONTRAF
Afreximbank's Food Emergency Contingent Trade Financing Facility enables physical food reserves to be substituted with a standby facility allowing vulnerable African countries to finance the commercial imports of grains, or their staple food of choice, if they have a food emergency. It guarantees the availability of an import financing facility in the event of a crisis when access to trade financial markets may be more stringent for the country.
The Medical Centre of Excellence, planned for construction by Afreximbank in Nigeria, beginning in December 2019, will have a major impact in reducing the foreign exchange cost incurred by Africans when traveling outside the continent to seek medical care, thereby also keeping medical tourism within the continent. More than 300,000 Africans travel annually to India alone for medical services, spending more than $2 billion each year. The Bank's Health and Medical Tourism Programme, working with partners like Kings College Hospital, London, is designed to foster the emergence of world-class medical facilities and research centers across Africa, which will improve life expectancy as well as stem the outflow of billions in scarce foreign exchange.
