A new US$1bn financing programme will help promote and expand trade and investments between South Africa and the rest of the African continent.

That’s the anticipated outcome of a memorandum of understanding signed between the African Export-Import Bank (Afreximbank) and the Export Credit Insurance Corporation of South Africa (ECIC), in which they agree to jointly implement, an initiative dubbed the South Africa-Africa Trade and Investment Promotion Programme (SATIPP).

The programme will focus on South Africa-based entrepreneurs, helping them join regional supply chains. It will offer trade and project financing, guarantees, twinning/business matchmaking services, export logistics facilitation, capacity-building and trade information and advisory services to companies seeking trade and investment opportunities in Afreximbank’s member states.

Under the memorandum of understanding, Afreximbank and ECIC have agreed to work together to identify, prepare and appraise trade transactions and projects, explore co-financing and risk-sharing opportunities, as well as share knowledge on intra-African trade matters through technical co-operation, staff exchange, research and joint events.

“We realise that one of the best ways to enhance our exporting capabilities as a country is by intensifying mutually beneficial trade with the rest of the continent,” says Kutoane Kutoane, CEO of ECIC.

South Africa only joined Afreximbank as a shareholder in November last year, thus giving its exporters access to the pool of structured trade finance facilities offered by the bank. The country was unable to join when Afreximbank was created in 1993 as it was still under apartheid rule at the time.

The membership is of huge strategic importance to Afreximbank and its goal to boost trade in the region. The country already accounts for the largest proportion of intra-African trade for both exports (25%) and imports (15%), according to the bank.