Post Views: 86 The African Development Bank Group (AfDB), on Tuesday said it approved a $14.12m facility to support Nigeria’s become the 15th member o...
The African Development Bank Group (AfDB), on Tuesday said it approved a $14.12m facility to support Nigeria’s become the 15th member of the African Trade Insurance Agency (ATI), necessary to enable ATI commence operations in the country.
Membership of the ATI will enable Nigeria benefit from gross political and commercial risk insurance cover on total investments and trade amounting to over US$5bn by 2020.
The catalytic effect of using limited financial resources in this way, AfDB assured in its statement, is undoubtedly massive, adding that the approved facility complements ongoing and planned interventions geared at building institutional capacity and improving the resilience of Nigeria’s economy.
Also, the bank noted that membership of the “ATI will enable Nigeria to leverage its position to mobilize additional resources to finance trade, especially importation of essential goods such as medicines and communications equipment, to rehabilitate basic infrastructure and strengthen the country’s productive sector.”
ATI’s mandate is to provide medium to long term credit and political risk insurance, as well as other risk mitigation products to its member countries and related public and private sector actors.
These products directly encourage and facilitate foreign direct investment as well as local private sector investment in regional member countries and intra- and extra-African trade. ATI catalyzes private sector investments in infrastructure projects, thereby promoting economic integration of participating countries into regional markets.
This financing aligns with four of the AfDB’s High 5 priorities, namely: Light Up and Power Africa, Industrialize Africa, Feed Africa and Integrate Africa. As a trade finance facilitation initiative, this financing will support operations that are crosscutting and multi-sectoral in nature and will have an impact on agribusiness, infrastructure development, electricity generation, telecommunications and manufacturing.
The statement quoted AfDB’s Director of the Financial Sector Department, Stefan Nalletamby as saying “the bank seeks to achieve its ambitious development mandate by working with and through other strategic partners, and where possible, by supporting the development of strong and viable African institutions such as ATI.
“This financing scales up the work of ATI by supporting the beneficiary RMCs to become members,” he added.