By Folasade Akpan
Abuja, Nov. 24, 2020 Prof. Benedict Oramah, the President, African Export-Import Bank (Afreximbank) says the bank has committed over 350 million dollars to the Fund for Export Development in Africa (FEDA).
He said this at the signing of establishment agreement for the fund with Rwanda, a statement issued by the bank on Tuesday in Cairo, Egypt said.
Oramah said that the amount included commitments for operation of a credit fund, investments in the bank’s strategic initiatives and those to be deployed under limited partnership frameworks.
“FEDA is a new vehicle created to deal with the perennial problem of capital constraints to private sector development and industrialisation in Africa.
“I will like to thank President Paul Kagame of the Republic of Rwanda and his government for embracing the strategic essence of this institution to both Rwanda and Africa.
“To have agreed to host FEDA without any equivocation is a clear and bold statement of visionary leadership and recognition of the economic value of Pan-African institutions,” he said.
The establishment agreement and Memorandum of Understanding (MOU) were signed by Alfred Kalisa, Ambassador of the Republic of Rwanda in Egypt and Oramah in the presence of Mahamadou Labarang, Dean of the African Ambassadors in Cairo and FEDA Chief Executive Officer, Dr Philip Kamau.
Kalisa said the government of Rwanda was happy to have signed the key agreements with Afreximbank.
“Rwanda is glad to host FEDA as we work together to achieve the dreams of the African Continental Free Trade Area (ACfTA) on the continent.
“We will work together to ensure that FEDA is successful in driving and achieving its mandate,’ he said.
The establishment agreement created FEDA, while the headquarters agreement provided that Rwanda would host the headquarters office, the bank said.
FEDA was established by Afreximbank to facilitate foreign direct investment flows into Africa’s trade and export sectors and to fill the equity funding gap that amounted to 110 billion dollars per annum in exports related sectors.
FEDA, a development-oriented subsidiary of Afreximbank aimed to provide equity financing to companies operating in key industries and sectors.
This is to significantly increase the likelihood of success in delivering on Afreximbank’s development priorities and meeting its strategic goals under the main pillars of the intra-African Trade Strategy and the Industrialisation and Export Development Strategy.
FEDA is tasked to provide capital to companies in the financial services, technology consumer and retail goods, tourism, manufacturing, transport, logistics and warehousing.
Other areas are trade enabling infrastructure like industrial parks, agribusiness and education sectors in Afreximbank’s member states.
FEDA will invest across all market segments but with greater focus on small and medium enterprises which has substantial funding shortages and represent about 90 per cent of businesses in Africa.
It will also invest in mature companies and start-up businesses where there is a gap in the marketplace and where investments have a high level of value “additionality’’ and development impact in Africa.
Naija247news reports that Afreximbank is a Pan-African multilateral financial institution with the mandate of financing and promoting intra-and extra-African trade.