Mr. Jean-Louis EKRAPresident

African Export – Import Bank

A Speech delivered at the Annual New Face of Africa Dinner Organized by DLA

Piper UKNovember 24, 2014

Mr. Jean-Louis EKRAPresident

African Export – Import Bank

A Speech delivered at the Annual New Face of Africa Dinner Organized by DLA

Piper UKNovember 24, 2014

An Agenda for Afreximbank in the Emergent New Face of Africa

(2)

I am grateful to DLA Piper, UK for inviting me

to be this Year’s Keynote Speaker in what has

become a Prestigious Annual Dinner Series.

We believe that the Series serves an important

purpose not only for the development

aspirations of Africa, but also in fostering the

global partnerships critical to realizing those

aspirations. I am therefore pleased to address

this august gathering on a subject matter dear

to us at Afreximbank, namely the positive

economic transformation that Africa is

experiencing.

(3)

But I will not bore you, distinguished ladies

and Gentlemen, with another rendition of

certain statistics popularized by the

Consultancy firm, Mckinsey and Co., when they

published their now famous “Lions on the

Move”

While those statistics are important, I will use

them only to set the stage in discussing the

changes occurring in Africa and which in fact

are shaping the statistics. It is by

understanding these real changes that are

impactful from a development economics point

of view that the agenda Afreximbank has set for

itself to address the challenges and

opportunities before the “New Africa” can be

better understood.

(4)

Before proceeding, distinguished ladies and

gentlemen, permit me to quickly introduce the

African Export – Import Bank (Afreximbank), the

organization I lead.

Afreximbank is a Pan-African Multilateral Trade

Finance Institution created in 1993, under the

auspices of the African Development Bank (AfDB). It

is an international Public Private Partnership to

promote and finance intra- and extra- African trade.

It is headquartered in Cairo, Egypt and has branch

offices in Abuja (Nigeria) and Harare (Zimbabwe).

New branches are expected to open in Nairobi, Kenya

and Abidjan, Cote d’Ivoire in early 2015;

It offers credit (trade and project finance), risk

bearing and trade information/ advisory services.

(5)

• The Bank currently has 4-classes of Shareholders. At inception there were 3 Classes, namely:

Class “A”: made up of African governments and/or their central banks, African Development Bank (AfDB), African continental, regional and sub-regional financial institutions and economic organizations;

Class “B”: consisting of African national financial institutions the African private investors; and

Class “C”: comprising International financial institutions and economic organizations, non-African financial institutions and non-African private investors;

In 2012, a new Class of Shares (Class D) was created. Class “D” shares are open to subscription by any investor, African or non-African. The Charter of the Bank permits the listing of this Class of Shares. There are currently no investors in this Class.

(6)

The Bank was conceived to be an African –

controlled, private sector – led Bank as well as an

international partnership – a concept driven by

strong Afro-pessimism prevailing on the eve of its

establishment;

It was envisaged that at full subscription of its

shares, the Bank would be 75% controlled by

Africans and 65% private sector led. 25% of the

shares were to be held by non-African investors. Class A35%

Class B40%

Class C25%

African Entities =

75%

Private Sector = 65%

Page 7

A Pan-African Presence

Member country with office

Member country

Head office

36 Participant States across Africa

Angola Ivory Coast Republic of CongoBenin Kenya Rwanda

Botswana Lesotho SenegalBurkina Faso Liberia Seychelles

Cameroon Malawi Sierra LeoneCape Verde Mali Sudan

DRC Mauritania TanzaniaEgypt Mauritius Tunisia

Ethiopia Mozambique UgandaGabon Namibia ZambiaGambia Niger ZimbabweGhana Nigeria

Guinea

Cairo

Abidjan

Harare

Nairobi

Abuja

Currently, the shares of the Bank are held: 63% by sovereigns (Class A); 27% by African financial

institutions and private investors (Class B); and

10% by non-African investors (Class C)

Class D shares were created to correct this lopsided distribution upon launch

Under its Establishment Agreement, the Bank enjoys Preferred Creditor Status as well as tax and diplomatic privileges in its member countries.

Afreximbank is Rated Baa2 by Moody’s and BBB- by Fitch

For more information, Please visit

www.afreximbank.com

(8)

Distinguished Ladies and Gentlemen, there is no

doubt that Africa has come a long way from the

dismal years of the 1980s and 1990s to the extent

that today we are confident enough to talk about the

“New Face of Africa”.

However, since a new face does not necessarily

mean a beautiful face, I consider some historical

excursion important in understanding whether the

emergent New Face of the continent is worth

celebrating.

It may surprise some of you to be reminded that

immediately following political independence in the

1960s and early 1970s, Africa was ahead of

Developing Asia including China and India and the

Asian Tigers regarding many measures of economic

progress.

(9)

At that time, Africa’s per Capita GDP was larger

than that of Developing Asia, including China and

India. Per Capita GDP averaged over US$996

compared to US$700 for the group of economies in

Developing Asia during 1960-1979. The continent’s

merchandise exports and share of global trade was

clearly higher than those of Developing Asia

Developing Asia

Africa

-10

-5

0

5

10

1960 1965 1970 1975 1980

Africa

Developing Asia

Real GDP Growth Rate (%)

Africa

Dev. Asia

3

4

5

6

7

1960 1965 1970 1975 1980

Africa

Dev. Asia

Africa/Asia

Share of Global Exports, (%)

0

25

50

75

100

125

1960 1965 1970 1975 1980

Merchandise Exports, (US$ Bn)

Africa

Developing. Asia

source: World Bank World Development Indicators, 2014

1960-1980Africa vs. Developing Asia

(10)

As the chart hereunder shows, it was in the 1980s

that a combination of internal and external factors

wreaked havoc on Africa’s economies, such that the

continent began to stagnate while Developing Asia

began to emerge.

Dev Asia

Africa

Africa

Dev Asia

0.0

1.0

2.0

3.0

4.0

5.0

RG

DP

in U

S$'0

00

1970 1980 1990 2000 2010

AfricaDeveloping AsiaAfrica > Dev. Asia

Africa < Dev. Asia

source: UNCTAD UNCTADstat, 2014

2005=100, 1970-2012Trends in Real GDP Per Capita of Africa & Dev. Asia

0

2000

4000

6000

8000

US

$ B

illio

n

1960 1970 1980 1990 2000 2010

Africa Dev. Asia

sources:1. World Bank WDI, 20142. IMF IFS, 20143. UNCTAD UNCTADSTAT, 2014

Trends in Real GDP Growth, 1960-2013Africa Vs. Dev. Asia

(11)

While the external factors, especially the global

debt crisis of the late 1970s and early 1980s

were important it was the internal factors that

were the main culprits.

It was these internal factors that on their own

and as a consequence of their effects, created

the Dismal Decades for Africa and the Old Face

we all wish to bury.

But what were the characteristics of the Old

Face?, You Would Ask:

The Old Face represented a set of policy

makers who acted as if the continent’s

primary macroeconomic objective was to self-

destruct;

(12)

A political Class that allowed itself to be consumed by acrimony, tribalism, inordinate ambition for power and disrespect for democratic principles, paving the way for coup d’états and the emergence of military governments across Africa. Coup-making became so rampant that at some point, there were as many as 39 successful Military Coups and as many as 60 failed attempts as evident in the Chart below.

19

20

14

0

5

10

15

20

Nu

mbe

r

1970-79 1980-89 1990-99

Successful

35

25

21

0

10

20

30

40

Nu

mbe

r

1970-79 1980-89 1990-99

Attempted/Failed

source: Compiled from AfDB (2012). {it:Political Fragility in Africa: Are Military Coup d'Etat a Never-Ending Phenomenon?}

1970-1999Military Coups in Africa

(13)

• So politically, a Face of

the continent emerged

– one defined by brutal

military dictatorships;

• With military

dictatorships,

intolerance ruled and

wars and civil strife

raged across the

continent. At some

point in the 1980s/90s

there were at least 18

wars raging.

(14)

Wars and political instability fuelled economic stagnation, poverty and hunger;

• The pace of expansion of the African economy

slowed sharply during the 1980s and 1990s,

growing at an average annual rate of about 2%

compared to over 5% in the 1960s and early

1970s; per capita income stagnated at US$750

for two decades; inflation was at crisis levels of

more than 25% in the 1980s; fiscal deficits and

debt were at unsustainable levels.

(15)

• Trade performance was dismal, with the

continent’s merchandise exports stagnating at

around US$80 billion during 1980-1990. At a

level of US$203 billion in 1990, Africa’s total

trade represented 2.9% of world trade down

from 6.1% in 1960; commodity composition that

appeared set to expand in the 1960s and early

1970s reversed such that by the early 1990s

commodities accounted or over 80% of the

exports of most African countries while more

than 75% of exports were destined to Europe

and the USA.

(16)

• Financial flows also saw a significant retreat

with the rate of growth of FDI slowing to 9%

during 1980s and 1990s from over 15% in the

1960s and 1970s; stripped of flows to South

Africa and major oil producers, FDI inflows

were virtually non-existent.

• The retreat of international banks from African

trade finance during this period led to high

cost of trade finance with import financing

priced as high as 12% per annum in some

countries; provision of such financings was

under very stringent conditions e.g. cash

collateralized L/Cs and shorter tenors. Project

financing was virtually non-existent.

(17)

As a consequence of

the foregoing, the

Face of Africa that

became prevalent at

the time was that

defined by:

Hunger and poverty;

wars, corruption and

crime,

forced migration

(refugees); and

disasters.

(18)

• Distinguished Ladies and Gentlemen, by the year 2000, a combination of factors, some with a history extending as far back as the late 1980s and the early 1990s began contributing in shaping the emergent New Face of Africa we are discussing today. The key forces at play included: Economic Reforms launched across the continent

from the late 1980s under the auspices of the BrettonWoods institutions which also promoted governance improvements and debt forgiveness and cancellations;

Political reforms that led to a widespread adoption of democracy and with it a new crop of leaders determined to place Africa in its rightful place in the global scheme of things.

The emergence of a vibrant private sector as a consequence of these Reforms and which is poised and equipped to take advantage of economic opportunities.

(19)

The rise of the BRICS, especially China as an important

trading partner and source of development capital;

The commodity super-cycle which burst upon the scene

in the early 2000s and sustained the current account

and reserve positions of many African economies; and

The increased relevance of multilateral financial

institutions, such as the Afreximbank, especially in the

finance of private sector activities. This made it possible

for ADDITIONALITY to be brought into the financing of

the Private Sector thereby making their activities more

impactful from a development point of view

What have all these forces shaped?

What have they brought to the emergent New Face of

Africa?

(20)

19701973

19761979

19821985

19881991

19941997

20002003

20062009

2012

(0.30)

0.20

0.70

1.20

1.70

2.20

Trends in Africa's Real GDP (US$ Trillion)

First, the continent

has seen tremendous

expansion in economic

activity since the year

2000, with real GDP

growth rate in excess

of 5% per annum;

Real GDP amounted to

over US$2.2 trillion in

2013, up from less

than US$800 billion

in 2000.

(21)

It is therefore not surprising that an IMF report confirmed that 6 of the world’s fastest growing economies during he last decade were in Africa

Developing Asia

Africa Middle East Central & Eastern Europe

Latin America World Developed Economies

0

1

2

3

4

5

6

7

8 7.2

4.8 4.74.3

3.12.6

1.5

Compound Annual Real GDP Growth by Region, 2000-10 (%)

source: McKinney & Co, 2011

During the decade of 2000s, Africa became the

second fastest growing region;

(22)

Second, is the rapid growth in African trade, which

has grown from a compounded annual rate of 10%

between 1991 and 2013, bringing total merchandise

trade value from US$192 billion in 1991 to US$1.3

trillion in 2013;

Intra-African trade has grown about 6-fold between

1990 and 2013 to reach an estimated US$160 billion.

From less than 10% in the early 1990s, the share of

intra-African trade reached over 12% in 2013.

Country experiences differ, with some, such as Cote

d’Ivoire, Gambia, Liberia, Malawi, Mozambique,

Rwanda and Togo, having intra-regional trade

accounting for more than 30% of their total trade in

2013 – a figure closer to the experience in other

regions of the world.

(23)

Third, is the growth in non-traditional sources

of finance which have outpaced traditional

funding sources like Overseas Developments

Assistance (ODAs) and FDIs: Migrant remittances now exceed Foreign Direct

Investment (FDI) flows and covers the

merchandise imports bill of many countries in

Africa. Remittances, since 2000 has approximated

more than 120% of FDI and between 70 to 100% of

merchandise imports of many countries;

Some countries, such as Cape Verde, Gambia,

Lesotho, Mali and Tunisia, receive migrant

remittances flows in excess of 100% of their

import values. For relatively large economies such

as; Egypt, Morocco and Nigeria, migrant

remittances values range between 20 and 70% of

their total merchandise imports values.

(24)

Fourth, is a marked reduction in civil strifes and coup

plotting. The number of successful coups declined to 3

in the last four years, from an average of about 25

during the 1980s

1920

14

9

3

0

5

10

15

20

Nu

mbe

r

19

70

-79

19

80

-89

19

90

-99

20

00

-09

20

10

-12

Successful

35

25

21

16

5

0

10

20

30

40

Nu

mbe

r

19

70

-79

19

80

-89

19

90

-99

20

00

-09

20

10

-12

Attempted/Failed

source: Compiled from AfDB (2012). {it:Political Fragility in Africa: Are Military Coup d'Etat a Never-Ending Phenomenon?}

1970-2012Military Coups in Africa

(25)

Distinguished Ladies and Gentlemen,

Apart from the foregoing, other related factors are

also at play in shaping the emerging New Face of

Africa.

Permit me to also touch on these.

(26)

Africa

India

Latin America

Southeast Asia

China

North America

Europe

Japan

-1.5 -1 -0.5 0 0.5 1 1.5 2 2.5 3

2.5

2

1.8

1.8

1.2

1.1

0.2

-0.2

2.3

1.6

1.6

1.3

1.2

0.1

0.5

-0.9

Growth of Working-Age Population

(% Annual Growth)2010-20 2000-10

Source: ILO, Global Employment Trends, 2011; United Nations World Population Prospects,

2011 McKinney & Co, 2011

While in the 1980s the Asian

Tigers were supported to

emerge by favorable

demographics, it is also the

case with Africa today.

Africa presently has the fastest

growing working population.

Its middle class, is estimated

to be the fastest growing in

the world.

First is Demographic Transition in Africa

(27)

The implication of this burgeoning African

middle class is sustained expansion in

household spending on consumer and

investment goods and services. Consequently, we have seen a rapid expansion in

investment in telecommunications, retail,

manufacturing, travel and tourism, and financial

services in the continent. Many African owned businesses have spread

across the continent, particularly in the retail,

Telecoms and Financial services sectors. Some

examples include: Shoprite, a South African retail outlet which

operates 453 stores spread across 17

countries in Africa;

(28)

Ecobank which is now present in about 36 countries. Several Nigerian Banks, including UBA, Guaranty Trust Bank, Zenith Bank and others have spread across East, West and Southern Africa. Stanbic Bank of South Africa also has a widespread footprint across Africa; Econet, another African-owned mobile operator has presence in many African countries

MTN, the South African mobile telecom giant is present in at least 17 countries in Africa;

MultiChoice Digital Satellite TV service provider has footprints in 48 African countries.

The entertainemnt industry is blossoming. In Nigeria, for instance, Nollywood accounts for 3% of the Country’s GDP or about USD2 billion in economic size.

(29)

Second is Rising Investments in Human

Capital and Infrastructure Developments

Deliberate expenditure of governments on the

development of their human resource,

investment in the provision of quality health

care and development of relevant

infrastructure are all becoming a priority in

Africa. For example, Nigeria plans to invest

about US$20 billion in its education sector in

the next few years, and the Government of

Democratic Republic of the Congo is committed

to a large infrastructure investment

programme amounting to about USD2 billion.

Similar investments are on-going across Africa.

(30)

Third is the Growing Size and Number of African

Entrepreneurs

Like Asia, Africa has grown and is growing its own

regional champions such as the Dangote Group,

MTN, Olam, Ecobank, Econet, UBA, Kenya Airways,

Ethiopian Airlines, El-Sewedy Electric of Egypt,

ShopRite of South Africa to name but a few. These

companies are poised to play the role of the

Samsungs, Daewoos, Hyundais, etc. in the global

market place. For instance:

the Dangote Group has become one of the largest

cement manufacturers in the world, producing

world class cement from its various facilities across

14 African countries, as well as Brazil and

elsewhere;  

MTN, a leading South African GSM telecom

operator operates in 17 Countries around the world

with revenues that amounted to US$12.4 billion in

2013;

(31)

the Egyptian company, ElSewedy Electric  has

 facilities across Africa, Europe and even

Australia producing and supplying high quality

electrical equipment. With an estimated annual

revenues of US$2.2 billion in 2013, the

company competes effectively with Asian peers

in Africa and elsewhere exporting over US$500

million of equipment, including wind turbines

to African countries.

(32)

The Fourth Factor is Abundant Natural

Resources

Africa’s natural resource potential is enormous

and offers substantial opportunities to

international investors. For example total oil

and natural gas reserves ranged between 200

and 210 billion barrels of oil equivalent as at

2010. Recent significant oil and natural gas

discoveries in Chad, Uganda, Mozambique,

Ghana, Tanzania, Côte d’Ivoire, and similar

prospects in Kenya, Mali and Sierra Leone are

attracting the attention of African and non-

African investors;

Further, Africa is richly endowed with mineral

and metals. Many African economies are

becoming important in terms of global mineral

and metal production.

(33)

New gold-mining projects are being developed

in Ghana, Burkina Faso, Mali, Mauritania,

Liberia and Sierra Leone. In DR Congo, a mine

with about 1 billion tonnes of Cooper reserves

is planned for development by Gecamines, the

State Mining Company.

Good water and arable land have been

important resources in today’s world and Africa

is reputed to have them in abundance,

accounting for about 60% of useable arable

land globally.

(34)

Distinguished Ladies and Gentlemen

Other positive factors include:

i. increased capital investment in infrastructure

development;

ii. improved legal and regulatory framework in

many countries through reforms; and

iii. rapidly improving international investor

perception of the continent as an attractive

and safe destination for investment.

Distinguished Guest here present

These developments give me hope that Africa will

take its rightful place in global affairs in the near

future. Forecasts suggest that:

African economies will grow by an average of 5.5% to

reach US$15.2 trillion in 2050;

African merchandise trade will reach US$20.8 billion

by 2050, to represent a minimum of 8% of global

trade;

Trade with Asia, especially China and India will

dominate, exceeding 40% of total trade in 5 years;

Intra-African trade would exceed 16% of the total

African trade in 5 years;(35)

(36)

The Emergent New Face of Africa

Distinguished Ladies and Gentlemen, the changes

that are occurring are defining a New Africa:

An Africa where enterprise and entrepreneurship

are replacing hopelessness and despair;

An Africa where opportunities are not fettered by

controls and undue government interference

A continent that is set to become

“decommoditized” through value-addition to its

abundant natural and agricultural resources;

(37)

A continent trading more with itself and with a more

diversified market; a more integrated continent with

better intra-regional investments and business

relationships;

An Africa with a fair share of accumulated capital to

take advantage of the global market place;

An Africa willing and able to confront its own

challenges as demonstrated in the recently launched

African Private Sector Ebola Fund which in a day

raised close to US$30 million under the auspices of

the African Union

(38)

Distinguished Ladies and Gentlemen

The question that arises again is what is

required to ensure that this momentum is

sustained?

In my view, appropriate policies and institutions

for:

Sustaining trade-led economic growth

strategies, especially the promotion of intra-

African and Africa – South trade;

Prioritizing the transformation of the

continent’s commodities into value added

items for local sales and for exports;

(39)

Development and financing of SMEs across

major value chains in the continent,

including in the context of their intra-African

trading activities;

Development of human capital and

appropriate infrastructure;

Access to capital at affordable terms all

through the productive value chain; and

Supporting continued expansion of the

middle class and household consumption

(40)

AN AGENDA FOR AFREXIMBANK

Distinguished Ladies and Gentlemen, the

foregoing shaped the Agenda Afreximbank has

set for itself so that it can contribute in

defining a New and Positive Face of Africa

In setting its Agenda, as set out in its Fourth

Strategic Plan under implementation, the Bank

was guided by its comparative advantage in

choosing where it can make maximum impact

In essence, the key areas of focus are:

Sustaining trade and project finance flows into

Africa, even under conditions of rising

compliance costs faced by international banks.

(41)

Supporting the expansion of value-added exports out of Africa;

Promoting market diversification;

Supporting the financing of SMEs in supply chains;

Promoting intra-regional trade, including formalizing the large informal intra-regional trade sector; and

Supporting African content in key economic activities.

Permit me Distinguished ladies and Gentlemen to touch on a few activities and interventions we have used towards the pursuit of the foregoing Agenda.

A visit to Afreximbank’s website will avail you the opportunity of visualizing the array of products we have on offer. However, I will like at this time to focus on those programmes and facilities that most impact on the subject matter of today.

(42)

AN AGENDA FOR AFREXIMBANK

a. Promotion of Value-Added Exports

Afreximbank has in place an Export

Development Programme (EDP) dedicated,

among others, towards facilitating non-

commodity export production, especially

export manufacturing using Credit, Risk

Bearing, Twining, Market Access as well as

Advisory services.

The main thrust of the Programme is to

facilitate, promote and finance export

processing in Africa. The Bank has committed

over half a billion US dollars on projects

across Africa under this Programme.

(43)

In 2012, the Bank launched the Africa Cocoa

Initiative (also called AFRICOIN) aimed at

achieving the processing of at least 35% of

cocoa produced in Africa within the continent.

This was considered critical given that Africa

currently produces about 80% of world cocoa

of which only about 20% is processed locally

(44)

Under the initiative, the Bank intervenes all through the cocoa value chain, namely:

• Upstream through support for issuance of cocoa bonds by national governments or agencies of cocoa producing countries, proceeds of which are to be used in financing productivity improvement projects and programmes at the farm level;

• Mid-stream through financing of cocoa processors to acquire equipment and cocoa beans for processing. As at date, the Bank has financed an amount of US$350 million in support of processing plants in Nigeria, Cote d’Ivoire and Ghana and is in the process of financing new processing plants in Cameroon. Capacities created are beginning to make Africa a new cocoa processing hub just as Malaysia is for rubber.

(45)

• Downstream through support of consumption promotion within Africa and Asia in collaboration with the International Cocoa Organization (ICCO).

The Bank hopes that if implemented successfully, the lessons learned can be transferred to other commodities.

(46)

AN AGENDA FOR AFREXIMBANK

b. Promotion of Intra-African Trade This is also at the forefront of the Bank’s agenda. A

special Programme dubbed Intra-African Trade Facilitation Programme (INTRAFAP) was installed in 2012 to be used in championing this objective, with the goal being to use it in raising intra-African trade share of Africa’s total trade to about 16% by the end of 2016;

A critical component of this effort is an on-going project by the Bank to develop a platform that would facilitate the use of mobile banking in intra-regional trade payments. The Bank is developing this project with a major African Telecom operator and hopes that when implemented it will facilitate formalization of the large informal intra-African trade estimated at anywhere between 50 to 100 billion US dollars;

(47)

The system would

(a)Facilitate intra-regional trade payments

(b)Reduce the foreign exchange cost of intra-

regional trade;

(c)Formalize most of the informal trade with

attendant benefit to all parties

(d)Make it easier for the SMEs involved in the

trade to access trade finance, etcetera

(48)

c. Promotion of African Content

Another priority of the Bank is to promote

African content in key sectors, especially the

extractive and heavy industries that had

hitherto been the exclusive preserve of

foreign players;

In Nigeria, for instance, the Bank assisted two

different consortia led by indigenous entities

to raise a combined amount of 1.2 billion US

dollars used to acquire the interests of some

oil majors in certain Nigerian oil assets. In a

particular asset, after the acquisition,

production was raised from 14 bpd to about

60 bpd.

(49)

In the Nigerian power sector, Afreximbank is

arranging a 1 billion US dollar syndicated loan

for an indigenous power company to acquire a

certain power assets that upon completion would

have a combined capacity equivalent to 25% of

Nigerian power generation capacity;

The Bank’s mining and oil services facilities have

been used to support indigenous participation in

the mining and oil and gas sectors of Angola,

Ghana, Nigeria and Zambia.

(50)

d. Facilitating Improved Access to Trade Finance

The Bank is committed to ensuring that trade

finance remains available to African entities. In

particular:

It is championing its African Letter of Credit

and Correspondent Banking Programme

(“Africorrbanking”) to provide access to trade

finance and trade services to African banks and

their clients.

(51)

This product provides credit cover to selected confirming banks and also facilitates access to Customer Due Diligence information required by those confirming banks;

In implementing the Africorrbanking, the Bank became aware of the constraints posed by the rising cost of compliance in line with ever growing regulatory requirements. Accordingly the Bank led the creation of an African Customer Due Diligence Repository platform (ACDIRP) intended to ease access to CDD information of African clients. ACDIRP is conceived as a cooperative, African-based platform.

Africorrbanking is making it possible for small banks in Sierra Leone, Liberia and elsewhere in Africa to access correspondent banking lines.

(52)

e. Promotion of Services Exports

Considering the potential contribution of services export to diversification of exports away from commodities, the Bank has in recent years intensified its financing and technical support to key services sectors in the continent, including the tourism sectors.

In 2010, the Bank introduced the Construction/Tourism-Linked Relay Facility (“ConTour” or the “Facility”) with a view to promoting the development of tourism projects and facilities in Africa to international standards.

Conceived as a risk sharing programme, under the facility, the Bank transfers construction risk to parties better able to manage them while it retains the operational risk in those projects.

(53)

Since the launch in 2010, the Bank has provided

financing for the construction of world class

hotels across Africa, including Cape Verde,

Sierra Leone, Mali, Cote d’Ivoire, Gabon,

Nigeria, among others;

Thanks to Contour, travelers to Lagos, Nigeria;

Freetown, Sierra Leone; Accra, Ghana; Bamako,

Mali; Dakar, Senegal can look forward to the

same staying to hotels of the same standards

they are used to elsewhere in the world.

(54)

f. Promotion of Health and Medical Tourism

To ensure that Africa participate fully in the

demand for medical tourism that is expected to

rise due to the expanding middle class, a similar

facility to Contour, called CONMED has also

been introduced by the Bank, again as a risk

sharing facility. It is in the context of the Bank’s

Medical Tourism promotion that it has entered a

Memorandum of Understanding with King’s

College Hospital, London to develop a medical

centre of excellence in Africa.

(55)

Support for initiatives that facilitate intra-regional trade remains on top of the Bank’s agenda. That is why it finances fleet acquisition by African airlines. In 2012 the Bank won a mandate to arrange a US$2 billion aircraft acquisition finance for Kenya Airways. The deal was fully executed during 2012 and 2013 and the airline acquired 20 aircrafts to enhance it capacity for connecting Africa. The deal was the largest, multi-sourced deal of this size ever in Africa.

Distinguished Ladies and Gentlemen, we are continuing our support for SMEs in supply chains through our factoring initiative; the expansion of our forfaiting offering to take advantage of the rising demand for investment goods; and our strategic goal of expanding our risk bearing facilities. These are critical and will continue to receive our full attention.

(56)

Distinguished Ladies and Gentlemen the task

before the Bank under the new agenda shaped

by the emerging New Face of Africa are

challenging but not insurmountable. The

greatest challenge it poses to the Bank is the

pressure it places on its capital. Shareholders

of the Bank have responded by agreeing a 500

million dollars capital increase. While this will

go a long way, we are mindful of the resource

requirement the emergent new face imposes on

us.

That is why we need partners to join hands with

the Bank as shareholders and/or risk sharing

partners;

(57)

If we do that, distinguished ladies and gentlemen, I

dare say that:

We will bury the Old Face of despair and welcome

the New Face of Hope; and

The Old Face of hunger and disease will be

replaced by the New Face of Vibrancy

We will then say with confidence that we have

reached the…

PROMISED LAND

(58)

Distinguished Guests, permit me to thank DLA

Piper again for this opportunity and all of you

for your attention.

David Church made impeccable arrangements

and I am happy to have been the beneficiary of

such a meticulous preparation.

(59)

Thank You all for listening

Jean-Louis EKRAPresident, Afreximbank