Nigeria to stake $50m as equity in African Trade Insurance Agency

Nigeria has agreed to stake $50 million as equity contribution in the African Trade Insurance Agency (ATI) to benefit from the insurance products it offers. Nigeria will first pay an initial commitment of $20 million anytime soon and pay up the balance with support from the African Development Bank (AfDB).

ATI’s Chief Executive Officer George Otieno disclosed this at a press briefing yesterday in Abuja on the sidelines of the forum on De-risking Nigeria’s Investments and Trade organised by ATI.

“We are at the final stages of Nigeria becoming a member. Nigeria needs to sign a treaty and also ratify it at Parliament. Nigeria has already budgeted for its contribution and the AfDB will provide it with part contribution. Nigeria is coming up with about $20m for a start but they have indicated interest to pay $50m as part of their capital contribution. That will be like 20 percent of their share capital at the moment,” he said.

ATI is Africa’s only multilateral credit and investment insurer, similar to the World Bank’s MIGA but with a focus purely on Africa. In order for a country to access ATI’s full slate of investment solutions, it must be a full member and shareholder.

“There are numerous benefits to Nigeria becoming a member of ATI. First, investors and international lenders will look favourably on this action and second the time couldn’t be better for our solutions.

“We can support the government to diversify the economy, boost banks’ liquidity, and even help the government to borrow internationally at more competitive rates. This year ATI’s products will stand behind around 5 percent of all new FDI into Africa so joining ATI literally boosts growth.

“Lastly, ATI is now paying dividends to shareholders making membership a near budget neutral decision for governments,” Mr. Otieno said.