CDC Group, the UK’s Development Finance Institution and impact investor, has announced a US$50 million trade finance facility for Ecobank International (EBI SA), the Paris based member of the Ecobank Group.
This marks CDC’s first partnership with EBI SA, and the commitment is aimed at providing systemic liquidity to underserved markets and crucial trade finance support to local banks and businesses across Africa amid Covid-19.
The Covid-19 crisis has had a significant adverse effect on trade flows, business operations and jobs in Africa’s markets.
The CDC facility will therefore support the continent’s economic recovery and is expected to generate between US$70 – $140 million in additional trade annually.
The investment will enhance the import of essential goods, commodities and capital equipment, while also helping to expand access to goods and services in general.
EBI SA, the international subsidiary of Togo-based Ecobank Group, is an ideal partner to boost CDC’s impact across Africa and help strengthen financial support for local banks and the businesses that they serve.
Through Ecobank Group’s extensive footprint and operations across 33 countries on the continent, the facility will broaden economic opportunities and inclusive growth, particularly in markets such as Togo, Burkina Faso and Chad.
The trade finance risk-sharing facility will meet the liquidity needs of local African banks at a crucial time, especially with the economic impact of the pandemic.
In essence, the facility provides systemic liquidity and supports vital supply chains across Africa’s markets, sustains and increases access to goods and services during the pandemic, bolsters economic opportunities and inclusive growth, in markets such as Togo, Burkina Faso and Chad.
By committing capital to address these shortfalls, CDC is taking on additional risk and providing further credit support and trade finance lines to local banks, thus protecting commerce across the continent.
The facility contributes to the UN Sustainable Development Goals Zero Hunger (SDG 2) and Decent Work and Economic Growth (SDG 8).