Natixis, the IFC and Standard Bank have teamed up in a US$500mn trade finance facility to support petroleum imports in Ethiopia.

The facility, arranged and lead by Natixis, will be used to finance Ethiopia’s import of refined petroleum products.

Under the agreement, closed in June, the financing will be used to assist Independent Petroleum Group’s (IPG’s) sales of petroleum products to Ethiopia over one year. IPG is one of the main suppliers of petroleum products to the country over the last four years and it secured the 2014 annual tender to supply over half of Ethiopia’s imports of refined petroleum products.

Ethiopia imports all of its petroleum products, which are critical for transportation, industrial and household uses.

“Natixis has had a longstanding experience with Ethiopia for over 30 years,” says Felipe Lopez Cruz, Natixis’ regional head of global energy and commodities, Dubai branch. “Our expertise in commodities, our presence in the Middle East, as well as the partnership with IFC and Standard Bank Group has allowed Natixis to finance Ethiopian oil imports successfully. We are proud of this achievement given the strategic nature of this flow to Ethiopia and to our client, Independent Petroleum Group.”

“The established facility will provide flexibility and support to the Ethiopian Petroleum Supplier Enterprise by extending the credit period for importing petroleum products and introducing new financial institutions and banks to the country,” says Abdullah Al-Khandari, the chief financial officer of IPG.

Oumar Seydi, IFC director for East and Southern Africa says: “Ethiopia depends on imported petroleum products to meet its infrastructure, agriculture and energy needs. IFC is committed to encouraging trade that supports economic growth and job creation in Ethiopia.”

IFC’s strategy in Ethiopia involves working closely with the private sector to support infrastructure, agriculture and entrepreneurs.