" ITREALMS: Private sector investment attracts 1bn Euro to Africa - ITREALMS

NLNG global

Saturday, October 31, 2020

Private sector investment attracts 1bn Euro to Africa - ITREALMS

ITREALMS ... making leadership SENSE with digital news!


The European Investment Bank (EIB) support worth 1 billion Euros, to some five African countries would strengthen their membership and share capital increase in the African Trade Insurance Agency (ATI), reports ITREALMS.

The benefactors of the private sector investment on the continent include Benin, Burkina Faso, Chad and Senegal.

EIB, ITREALMS gathered had agreed on EUR 60m financing to unlock African Trade Insurance Agency membership; Team Europe-Africa cooperation supporting economic resilience to COVID-19.

The West and Central African states, Burkina, Chad and Senegal will join 18 African countries including Benin, who is already a member, where business investment, job creation and access to finance has been increased by targeted investment insurance. As seen elsewhere across Africa, ATI membership will help to address the economic, social and health challenges caused by COVID-19.

Agreements for EUR 60 million from EIB will enable the four countries to either become full members or increase their current participation in ATI before the year ends. This is expected to leverage an estimated EUR 1 billion of new private sector investment.

The latest EIB support for transformational investment were agreed during a virtual signature ceremony attended by Toavina Ramamonjiarisoa, Acting Chief Executive Officer of ATI and Maria Shaw-Barragan, Director for EIB operations in Africa, the Caribbean and the Pacific.

“Business activity across West Africa will be transformed following this key agreement between ATI and the European Investment Bank. By joining ATI, Burkina, Chad and Senegal will be able to accelerate crucial investment and better cope with the pandemic. Benin, who has been a member since 2012, will further benefit from ATI’s products, through its new capital increase. Over the last twenty years, ATI has supported more than USD$62 billion of investments and trade across Africa. With ATI’s innovative solutions, member states have been able to attract competitively priced and longer-term financing owing to strong credit ratings, S&P ‘A’ and Moody’s ‘A3’, and ability to mobilize highly-rated reinsurance capacity.” said Toavina Ramamonjiarisoa, ATI’s Acting Chief Executive Officer.

“The European Investment Bank is pleased to enable Burkina Faso, Chad and Senegal to become full members of the African Trade Insurance Agency and Benin to increase its stake in ATI. This will facilitate and expand private sector and clean energy investment across West Africa and the Sahel. Improved insurance will create jobs and help business and entrepreneurs to better address challenges caused by COVID-19. As the bank of the European Union, the European Investment Bank is committed to supporting high-impact investment across Africa. The EIB is pleased to further strengthen our cooperation with ATI to ensure that proven trade and investment insurance expertise benefits even more countries in Africa. The EUR 60 million EIB support, in addition to the EUR 34 million rolled out last year to support Cameroon, Niger and Togo’s memberships demonstrates Team Europe’s rapid response to enhance cooperation with African partners during challenging times. New EIB support for private sector investment in West Africa follows recent backing of large scale solar energy and fifty years of engagement across Africa.” said Ambroise Fayolle, European Investment Bank Vice President.

Enabling Benin, Burkina, Chad and Senegal to benefit from African private sector investment best practice

Becoming a full member country will make it easier and cheaper for investors to create jobs, expand business activity and provide clean energy in all these countries.

Elsewhere in Africa, membership of ATI has enabled countries to reduce debt levels and provide global investors and financiers with comfort that sovereign transactions and other investments are back-stopped by a highly rated and reputable insurance guarantee provider.

The lack of investment insurance in most African markets is holding back vital investments, both in equity or debt, and hampers cross border trade. In recent months, increased economic challenges linked to the COVID-19 pandemic has compounded the shortage of trade insurance in Africa. ATI’s presence is therefore now, more than ever, a key component of many countries’ ability to remain attractive investment destinations.

As African countries begin to build buffers against the likely negative economic fall out from COVID-19, investment insurance capacity is seen as a critical part of the financial support that will be needed to better protect the economies of many African countries.

Nenye Dom/Editor

Featured post @ITREALMS

Sophia Oluchi Nwafor of Urum wins Anambra State 'Most Innovative Content Creator' - ITREALMS

ITREALMS ... making leadership SENSE with digital news! A student of Nnamdi Azikiwe University, Awka, Anambra State in the Department of Eco...