Proudly sponsored by

African nations plan $8bn fund to offset trade-pact losses

As part of a continent-wide free-trade agreement.
Image: Rodger Bosch/AFP/Getty Images

African nations plan to raise about $8 billion for a fund to help offset revenue losses for countries that lower cross-border tariffs, as part of a continent-wide free-trade agreement.

The African Export-Import Bank, or Afreximbank, previously provided $1 billion for the fund after the African Union set it up to help cushion sudden revenue losses and encourage participation. The free-trade area went into effect on January 1.

“The $1 billion made available by Afreximbank will be used to leverage funding from other multilateral development-finance institutions, export credit agencies, commercial banks and donors,” Afreximbank said in an emailed response to questions on Thursday. “About $8 billion is expected to be mobilized” to meet the level of support required by countries, it said.

The world’s biggest free-trade area aims to bolster intra-African trade by lowering or eliminating cross-border tariffs on 90% of goods, facilitating the movement of capital and people, promoting investment and paving the way for a customs union.

Trade within the continent, which stands at more than $350 billion a year, is expected to grow by 52% in the next decade, according to David Luke, coordinator of the African Trade Policy Centre at the United Nation’s Economic Commission for Africa.

© 2021 Bloomberg

COMMENTS   0

You must be signed in to comment.

SIGN IN SIGN UP

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

INSIDER SUBSCRIPTIONS APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING PORTFOLIO TOOL CPD HUB

Follow us:

Search Articles:
Click a Company: