The Japan Bank for International Co-operation (JBIC) and a group of private financial institutions are extending a US$350mn export credit line with a tenor of up to 20 years to the Eastern and Southern African Trade and Development Bank (TDB).

JBIC is providing up to US$210mn, with Japan’s export credit agency Nippon Export and Investment Insurance (Nexi) covering part of the deal. The facility is co-financed with private banks, which have not been named.

TDB will use the proceeds to provide its customers in Sub-Saharan Africa with funds for the import of machinery and equipment from Japanese companies and their overseas affiliates.

“Demand for machinery and equipment, which are needed for economic development, is expected to continue to expand in Sub-Saharan Africa,” JBIC says in a statement. “In light of this, this credit line is being set up to financially support the efforts of Japanese companies and their overseas affiliates to expand exports to this region. It is also expected to help further strengthen the economic relationship between Japan and Sub-Saharan Africa.”

JBIC further notes that it will “continue to financially support the expansion of Africa-bound exports from Japanese companies, as well as increase opportunities to participate in projects in the region, by drawing on its various financial instruments for structuring projects and performing its risk-assuming functions”.

The facility is the third and largest deal that JBIC and TDB have agreed to date.

In 2007, JBIC extended a ¥1.5bn (US$12.5mn) three-year export credit line, which was followed by a US$80mn seven-year line in 2016.