The African Export-Import Bank (Afreximbank) and the Export Development Bank of Egypt (EBE) have agreed to collaborate on a US$500mn scheme to support exports and investments by Egyptian businesses to other African countries.
Beneficiaries of the Export Credit Support Scheme (ECSS) must be exporters domiciled in Egypt, and the products must be of Egyptian origin, while the importers must be African and located in one of Afreximbank’s member countries.
The ECSS is a combination of products and services that protect against the risk of non-payment, and advances granted to exporters to meet short or medium-term export contracts.
Speaking during the scheme’s signing ceremony in Sharm El Sheikh, Afreximbank president Benedict Oramah said that the ECSS would assist Egyptian exporters to develop their industries and boost their exports into other African countries, thereby helping them to compete on near equal footing with exporters from the more developed economies.
He said that the scheme builds on other programmes that the bank is implementing in Egypt, including the US$500mn Egypt-Africa trade promotion programme, which has been fully utilised, and the bank’s support to the Egyptian economy during the global economic challenges of 2015 and 2016, when it disbursed more than US$7bn to Egyptian entities.
Although initially the ECSS will see Afreximbank collaborate with EBE directly, it can be extended to other Egyptian banks through the EBE.
The scheme also provides for support from the Export Credit Guarantee Company of Egypt, in which the EBE holds majority ownership, to partially cover and share transaction risk.
Other services expected to be offered under the scheme include export promotion activities for Egyptian products and commodities in African countries, and the provision of networking opportunities and market information and advisory services to Egyptian exporters.