Afreximbank backs CARICOM partners with US$1.5B

St. Kitts and Nevis could soon have access to hundreds of millions of dollars in project financing, following the December 26th board meeting of African Export-import Bank (Afreximbank). The Board of Directors of Afreximbank has approved US$1.5 billion in funding to enable member states of the Caribbean Community (CARICOM) that have ratified the Partnership Agreement with Afreximbank, to tap into the Bank’s various financial instruments.

This Board approval follows the accession of nine CARICOM member countries to the Afreximbank Partnership Agreement which was launched on 1 September 2022, at the first Africa-caribbean Trade and Investment Forum (ACTIF) held in Bridgetown, Barbados.

Recently ratified by Barbados, and in the process of being ratified by the other eight signatories, the treaty remains open for accession to the six CARICOM members that have yet to sign.

Senior executives of Afreximbank made their first official visit to St Kitts and Nevis in November, and among the many commitments made by the team, there was a pledge to partner with government officials to find investment opportunities.

The bank team met with the federal cabinet, and a number of critical things were discussed at that meeting, such as the processing of fish, fish farming and chicken packaging, and energy as a sector – as it is the goal of St. Kitts and Nevis to become an exporter of energy. The full list of proposed interventions and partnerships presented by Afreximbank were in various areas, and included: Solar power plants, Air and sea ports enhancements, Agriculture Production & Agro-processing, Fish farming and processing facilities, Poultry processing, Healthcare services, Establishing Correspondent Banking Relationships, Creation of air and sea links between Africa and the Caribbean Region, and Training and knowledge sharing in key areas, including e-government, special economic zones framework, and industrialization.

Prime Minister Dr Terrance Drew signed an agreement to strengthen collaboration and engagements between Africa and the Caribbean. He also decorated Afreximbank’s Global Head of Client Relations Rene Awambeng as an Honorary Citizen (Kittitian) Dr Drew noted that during his first trip to Barbados as prime minister, he met with Afreximbank executives, and this was essentially a precursor to the current interaction.

As part of the visit, Awambeng and his team held meetings with the Board of Directors and Executive Management of Bank Of Nevis International (BONI), and announced their entity would enter into a strategic relationship with BONI – with the local institution being a Trade Finance Intermediary as a means of underpinning and supporting Afreximbank’s regional footprint in St. Kitts & Nevis and the wider Eastern Caribbean. “Fostering and supporting African-caribbean trade, financial services and financing to provide regional FDI in key sectors of the economy is what Afreximbank does best. Recent technological advancements have created the opportunity for both Africa and the Caribbean to adopt leapfrog technologies that will accelerate the pace of economic development.

“We are delighted to be working with BONI to achieve these goals in St Kitts and Nevis and the wider Eastern Caribbean,” Mr Awambeng asserted, following the highlevel meetings.

Upon accession to the agreement, CARICOM member countries become Participating States in Afreximbank, conferring on the Bank the same privileges and immunities that it enjoys in the African Participating States that acceded to its Establishment Agreement. It unlocks the commencement of Afreximbank’s operations in the Caribbean.

The Partnership Agreement between Afreximbank and the constituent countries of CARICOM, consolidates the Bank’s efforts to promote and develop South-south trade and specifically trade between Africa and the Caribbean – in line with its Diaspora Strategy. Afreximbank defines intra-african trade as the flow of goods and services between or among African countries as well as the flow of goods and services between Africa and Africans in the Diaspora.

The US$1.5 billion financing approved by the Board of Directors of Afreximbank enables CARICOM countries to access the Bank’s financing instruments through financing facilities that support various identified economic sectors including tourism, healthcare, renewable energy, shipping, mining, agriculture and agribusiness, air links, and aquaculture. Afreximbank will also work to support local financial institutions to source finance for SMES.

These key sectors were identified following several Afreximbank-led business development and trade and investment promotion missions to the Caribbean. As part of its twinning initiatives, and investment promotion activities, Afreximbank is also working to introduce CARICOM investors and financial institutions to opportunities in all sectors across Africa, while exposing African investors to investment prospects in key sectors identified in CARICOM countries.

Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, commented:

“This approval by our Board of Directors of US$1.5 billion in funding is another giant step in the historic reconnection we are successfully forging between Africa and the Caribbean. Afreximbank is now all set to operate in the CARICOM member countries which we are pleased to welcome as Participating States in the Bank.

“We look forward to having all CARICOM members on board to maintain the extraordinary momentum we have been building since we met at the Africacaribbean Trade and Investment Forum in September 2022, and to respond together, through trade, to the development needs of the people of both our regions.” Headquartered in Cairo, Egypt, the African Export-import Bank (Afreximbank) is a Pan-african multilateral financial institution mandated to finance and promote intra-and extra-african trade. Afreximbank deploys innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby boosting economic expansion in Africa.

A stalwart supporter of the African Continental Free Trade Agreement (AFCFTA), Afreximbank has launched a Pan-african Payment and Settlement System (PAPSS) that was adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AFCFTA. Afreximbank is working with the AU and the AFCFTA Secretariat to develop an Adjustment Facility to support countries in effectively participating in the AFCFTA. At the end of 2021, the Bank’s total assets and guarantees stood at about US$25 billion, and its shareholder funds amounted to US$4 billion. Afreximbank disbursed more than US$51 billion between 2016 and 2021. The Bank has ratings assigned by GCR (international scale) (A), Moody’s (Baa1), Japan Credit Rating Agency (JCR) (A-) and Fitch