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Afreximbank, firm partner to boost Intra-Africa trade

Intra-Africa trade has received a boost following a $1 billion deal sealed by the African Export-Import Bank (Afreximbank) and the Export Credit Insurance Corporation (ECIC) of South Africa, to finance programmes that will expand trade and investment between South Africa and the rest of the continent.
ECIC, a company that provides political and commercial risk insurance to South African exporters , signed the deal with the Afreximbank in Johannesburg last month, announcing the first Intra-African Trade Fair (IATF), which will be held in Cairo from December 11 to 17.The trade deal came about after 44 of Africa’s 54 countries signed the landmark Continental Free Trade Area (CFTA) in Nairobi, Kenya, in March to increase trade among African countries, which is relatively low compared with other regions.Intra-African trade stands at 18per cent while trade in the European Union (EU) and Asia is about 60per cent.
With 1.2 billion people in Africa, the CFTA will create one of the largest free trade market zones in the world since the World Trade Organisation was created in 1995.
Afreximbank President Benedict Oramah, said the bank and the ECIC would work together to identify, prepare and appraise trade transactions and projects.The two institutions, he said, would explore co-financing and risk-sharing opportunities and share knowledge – with particular emphasis on intra-Africa trade matters – through technical cooperation, staff exchange, research and joint events.
“The joint initiative will support businesses through capacity building and market-information initiatives, and will help small and medium-sized entrepreneurs to join regional supply chains,” Oramah said.
“It will also provide advisory services and guarantees to South African investors seeking trade and investment opportunities in Afreximbank African member countries.”
Oramah said the initiative provided a platform for the realisation of Afreximbank’s strategic objectives to prioritise intra-Africa trade, industrialisation and export manufacturing.

ECIC CEO Kutoane Kutoane said: “We realise that one of the best ways to enhance our exporting capabilities as a country is by intensifying mutually beneficial trade with the rest of the continent.”  The signing ceremony also served as a platform to introduce and discuss the IATF being organised by Afreximbank and the African Union in Cairo, Egypt, from December 11 to 17.
IATF will be an annual event, bringing key players under one roof to share information and explore opportunities in one another’s countries in sectors, such as manufacturing, logistics, engineering, construction, tourism, entertainment, information and communication technology, heavy industries, finance, and agriculture. The aim is to create a digital repository and platform to link buyers and sellers. The event, it is believed will unlock trade among African countries to the value of $25 billion in the next five years.
Of the three biggest African economies, only Egypt has signed the CFTA. South Africa and Nigeria have not signed because of legal and internal issues. Both countries account for about one-third of the $3.4 trillion combined gross domestic product across Africa. 

Nigeria’s fear has been that the agreement would destroy local products; South Africa has to undergo a parliamentary process to get the nod to sign the CFTA.

culled:new telegraph