Afreximbank Executive Vice President Dr. Benedict Oramah addresses participants at the ITFA Annual Conference in Barcelona.
The African Export-Import Bank (Afreximbank) has predicted an increasing importance for supply chain financing in Africa.
Dr. Benedict Oramah, Afreximbank’s Executive Vice President for Business Development and Corporate Banking, told participants at the 41st Annual Conference of the International Trade and Forfaiting Association (ITFA) in Barcelona on 11 September that given the enlargement of Africa’s domestic supply chains to support extractive industries, manufacturing, retail and export agricultural products, “supply chain financing will become important”.
“On the import side, trade financiers who want to participate in financing Africa’s trade will need to move away from short-term deals and be more willing to take African payment risk,” he said.
He said that although Africa has not seen much forfaiting thus far, all the current opportunities would “underpin the rebirth of forfaiting”, arguing that trade was key to Africa’s ongoing growth. Africa’s changing trade habits would change its trade finance needs, he explained.
According to Dr. Oramah, Africa is making steady progress towards economic resurgence, changing from the ‘basket case’ of the 1980s and 1990s and becoming very much the “emerging bread basket of the world”.
He noted that African trade was widely expected to rise to around 7 per cent per annum to reach $2.1 trillion by 2020.
Dr. Oramah announced that that Afreximbank intended to take up membership of ITFA and to work more closely with the body as a strategic partner.