By Enyichukwu Enemanna
Africa’s leading trade bank, Afreximbank has unveiled an initial $8 billion financing package for its new member South Africa, supporting projects in sectors mining, automaking and manufacturing, the bank announced on Wednesday.
“We have put together an important package of 8 billion United States dollars … for South Africa,” Afreximbank president George Elombi said at a ceremony in Johannesburg.
“In particular we will prioritise mineral processing, the expansion of automotive manufacturing … and the expansion of industrial parks and specialized zones,” he added.
Access to these new trade finance products for the Africa’s most advanced economy is coming a time when its tariff row with the United States has increased the need for new export markets.
South Africa was unable to fully join Afreximbank when it was set up in 1993 because the country was still under apartheid rule, but last year the cabinet approved a plan to move to a “Class A” shareholding in the bank.
In August last year, the U.S. President Donald Trump had imposed a 30% tariff on South African exports to the U.S., the highest rate in Sub-Saharan Africa.
South African President Cyril Ramaphosa said his country’s deeper ties with Afreximbank showed its commitment to “African industrial development and to deepening trade, investment and development across the continent”.
South Africa’s membership is also coming at a time when Afreximbank has been in a dispute over whether its loans to African nations should be restructured in the event of defaults.
Asked about last month’s move by Fitch to downgrade Afreximbank to “junk” status and withdraw future credit ratings, president Elombi said the bank was “extremely solid” … and its treasury functions were “more than sufficient for our objective”.
“Investing remains our key objective, … so long as we remain policy-relevant with the member states … then we don’t have to worry about this,” he added
