The EBRD will increase trade activities for countries across the Commonwealth of Independent States (CIS) after signing a cooperation agreement with the Opec Fund for International Development (OFID), under which OFID will share risk in the EBRD’s Trade Facilitation Programme (TFP).

Under the programme, the EBRD provides guarantees for local issuing banks, which in turn provide trade guarantees for local importers or exporters. The cooperation agreement with OFID will enable the EBRD to increase its exposure significantly for selected issuing banks. It is envisaged that first countries to benefit will be Azerbaijan and Tajikistan and other countries are expected to follow suit.

The support from OFID is a further milestone in our long-standing cooperation with OFID, says EBRD president, Jean Lemierre. “Thanks to OFID’s support we will be able to increase the risk-taking capacity to further develop trade across the CIS and so support economic growth and create jobs.”

Suleiman Jasir Al-Herbish, director-general of OFID, adds: “This is an important region for OFID and we are pleased to join forces with the EBRD to help these countries to strengthen their economies by promoting international trade flows.”

Established in 1999, the TFP supports trade to, from and within the EBRD’s 29 countries of operations. It assists issuing banks in building track records with their correspondent confirming banks. This reduces cash collateral requirements and frees up clients’ working capital by providing guarantees for the payment of various trade finance instruments issued by local banks. The EBRD programme has been a template for other international financial institutions now actively involved in trade finance.

Under the TFP, the EBRD has facilitated 6,000 trade deals worth over €3.3bn. The programme now includes more than 100 issuing banks in the region, with limits exceeding €1bn in total, and 630 confirming banks globally.