AFRICA’s quest for increased integration and economic prosperity received a major boost this week following the launch of the Afreximbank African Collaborative Transit Guarantee Scheme (AACTGS) at the Intra-Africa Trade fair underway here.
In launching the AACTGS, Afreximbank president Professor Benedict Oramah described the scheme as a ground-breaking project which “signifies a monumental achievement in our journey towards continental integration and economic prosperity”.
He said in launching the scheme, African countries “stand on the brink of a new era for Africa” marked by “collaboration, innovation, and progress”.
“This ground-breaking project is a bold step towards improving the competitiveness of cross-border trade as we announce the historic issuance of the first-ever multi-border transit bond in the continent and the signing of other facilities that will revolutionise transit of goods in Africa forever.
“We are happy that this innovative collaboration between the Bank and COMESA (Common Market for Eastern and Southern Africa) has yielded the desired results of issuing a single transit bond that makes it possible for the movement of goods across the continent without hindrance.”
He said the AACTGS brings the continent closer to transforming into a single, integrated market.
Prof Oramah revealed Afreximbank has earmarked US$1 billion to support the scheme, which is expected to accelerate cross-border trade in Africa and save the continent about US$300 million annually in transit costs.
In line with the scheme, the first ever multi-border transit bond was issued in Zambia under the US$10 million facility to Innovate General Insurance (IGI).
Afreximbank also made a provision of US$300 million to African reinsurance provider ZEP Re to boost the COMESA Regional Customs Transit Guarantee (RCTG) Pool.
“This substantial financial injection underscores our commitment to bolstering the capacity of the COMESA RCTG Pool, which will instil confidence in traders and businesses, thereby paving the way for increased trade volumes in the region and creating a conducive environment for investment, innovation, and economic growth, “ said Prof Oramah.
Furthermore, Afreximbank signed a US$30 million Container Guarantee Facility with BSMART System Solutions, described by Prof Oramah as another” significant step forward in the realm of international trade and commerce”.
“This will revolutionise the way we manage containers, ensuring their safe and timely transit while minimising risks and enhancing security measures.
The provision of financial guarantees for containers will encourage investment and make international trade more accessible and inclusive for businesses of all sizes,” said the Afreximbank boss.
Under Afreximbank support, BSMART System Solutions will also establish 38 Integrated Customs Designated Stop Areas (ICDSA) across the East African Community region.
These ICDSAs will offer various services, including secure truck parking, customs documentation verification, logistics hubs, container yards, vehicle inspection centres, and affordable housing estates.
The primary objectives of these ICDSAs are to boost economic growth in the countries, enhance socio-economic conditions, and improve cargo security and transit controls. Under this mandate, Afreximbank will provide financial support of up to US$1.3 billion to BSMART and will act as the financial advisor for the project.
Herald
Positive Eye News
