New Zimbabwe.com

Zimbabwe to benefit from $25 billion Afrexim facility

By Alois Vinga


ZIMBABWE is among Africa Export Import Bank (AFREXIM) countries due to benefit from a $25 billion industrial retooling loan facility which is set to revamp the continent’s manufacturers and place them on a competitive edge.

AFREXIM Bank’s regional chief operating officer, Humphrey Nwugo told NewZimbabwe.com Business that local industry can take advantage of the multi-billion-dollar loan facility.

“The bank is set to introduce a re-tooling facility for Zimbabwean companies in an effort to improve capacity and efficiency of local industry and this comes as the bank has set us a $25 billion trade finance facility to promote African trade,” said Nwugo.

He indicated that the bank’s core business is to promote intra-African trade, pointing out that Africa trades more with Europe and the rest of the World than with itself as intra-Africa trade accounts for a mere 10 percent.

“… the bank has therefore set up a department to focus on the promotion of intra-Africa trade. One of the key focus of the bank is to ‘de-commodify’ Africa Trade hence the need to support industrial development in Zimbabwe and the rest of Africa to value add, create more sustainable trade opportunities, and reduce vulnerability associated with trade in commodities,” Nwugo said.

The reputable continental financial institution is set to host the Intra African Trade Fair in Cairo, Egypt from 11 to 17 December, 2018 where Zimbabwean companies are being invited to take part.

Lucrative deals which include accessing the multi-billion-dollar deal shall be concluded at the fair. The bank has also set up a trade development department in order to promote intra-Africa trade.

The development comes against the background where the bank has identified constraints affecting Intra-African trade as including poor and inadequate infrastructure which makes the movement of goods and people within the continent very difficult as well as costly, lack of standards and payment systems

The financial institution has provided, over the years, support to the Zimbabwean government, and the country’s local industry.

For those facilities that are below certain thresholds, the bank provides funding through local banks who then use their own assessments and conditions.

However, the bank intervenes when approached by individual companies who want to access money through banks in view of some of the conditions that are attached to the facilities.

AFREXIM Bank, is an International financial institution, headquartered in CairoEgypt, whose primary objective is to promote and finance trade within the African continent and trade between Africa and other continents.

The institution’s financial statements for the half-year period ended 30 June 2018, shows gross revenue of $343 million, representing a $21 million increase over the gross the same period in 2017.

The performance was attributed to a significant increase in fee income by 119 per cent while interest and similar income recorded a 2 per cent growth compared to prior year performance.

Attributable earnings over the six months also amounted to $110 million, beating the budget by 34 per cent.

The key profitability ratios equally came in well above budget, with the return on the Bank’s average shareholders’ equity (ROAE) standing at 10 per cent, compared to the budget: of 8.08 per cent, and the return on the average assets (ROAA) at 1.88 per cent as against the budget of 1.57 per cent