President Nana Addo Dankwa Akufo-Addo has touted the establishment of Afreximbank’s US$10 billion Adjustment Fund and the Pan-African Payment Systems as positive steps that would accelerate Africa’s rapid collective growth and development.
Working in collaboration with the AfCFTA Secretariat, President Akufo-Addo said Afreximbank’s US$10 billion Fund and the Pan-African Payment Systems—will strongly support African countries participate effectively in the AfCFTA as well as ensure a healthy financial mechanism to support intra African trade.
Addressing participants at the opening ceremony of the 30th Annual Meetings of African Export-Import Bank (Afreximbank) hosted in Accra, Ghana on Monday, President Akufo-Addo said the bank’s timely support to Ghana to navigate its recently macro-economic management challenges cannot be overlooked.
The 30th Annual Meeting of the Afreximbank, which began from Sunday 18th and scheduled to end on 21st June, 2023, would mark the high point of the Bank’s year-long 30th anniversary celebrations, under the theme: “Delivering the Vision. Building Prosperous for African.”
President Akufo-Addo explained that Ghana’s recently macroeconomic challenges that was exacerbated by the “reckless behaviour of rating agencies that engaged in cyclical downgrades”, shut Ghana out of the international capital market and turned its liquidity into a solvency crisis.
Afreximbank, according to President Akufo-Addo, provided timely support to help Ghana navigate its macro-economic management challenges, worsened by Russia-Ukraine war.
Ghana, which had become akin with bond holdings and had successfully gone to market at the height of pre COVID-19 downturns, had suddenly been shut out of the international capital market.
President Akufo, who abhorred the decision of credit rating agencies for downgrading Ghana’s economy, expressed Ghana’s gratitude to Afreximbank when the bank showed up to help the country manage her macroeconomic challenges.
He said “when you are dealing with powerful international financial institutions, it is important to have your own powerful financial institution.”
Touting the achievements of Afreximbank, President Akufo-Addo asked “what would have happened to the continent that was so heavily commodity dependent in 2015 and 2016, called commodity-super cycle, and suddenly came to an abrupt end, when the same global financial institutions and international investors were exiting the continent on mass, weaken our currencies in the process and further aggravating macroeconomic management challenges.”
Afreximbank, the President emphasised, was the financial institution that quickly put together, a countercyclical liquidity facility to help member countries bridged the significant trade financing gap confronting them.
As a result of the adverse of commodity terms of trade shocks, in the process, Afreximbank averted the cascading trade payment defaults that could have turn into liquidity crises and into a longer lasting solvency and banking crisis.
President Akufo-Addo maintained that after the outbreak of Covid-19 where most African countries including those in the Caribbean could not access personal protective equipment and vaccines during the vaccine nationalism, Afreximbank quickly saved the continent.
Working closely with African Centre for Disease Control, UNICA and the African Union and Envoy for Covid-19, Afreximbank developed quickly the African Vaccine Acquisition Trust that pulled procurement at the continental level, which suddenly turn out to be a powerful force in the global marketplace.
He said it is important and significant for Ghana, few months after coming out of its liquidity crisis, to host the 30th anniversary celebration of Afreximbank.
For 30 years, the Bank has been deploying innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialisation and intra-regional trade, thereby boosting economic expansion in Africa.
A stalwart supporter of the African Continental Free Trade Agreement (AfCFTA), Afreximbank has launched a Pan-African Payment and Settlement System (PAPSS) that was adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AfCFTA.
Working with the AfCFTA Secretariat and the AU, the Bank is setting up a US$10 billion Adjustment Fund to support countries to effectively participate in the AfCFTA.
At the end of 2022, Afreximbank’s total assets and guarantees stood at over US$31 billion and its shareholder funds amounted to US$5.2 billion.
The Bank disbursed more than US$86 billion between 2016 and 2022. Afreximbank has investment grade ratings assigned by GCR (international scale) (A), Moody’s (Baa1), Japan Credit Rating Agency (JCR) (A-) and Fitch (BBB). Afreximbank has evolved into a group entity comprising the Bank, its impact fund subsidiary called the Fund for Export Development Africa (FEDA), and its insurance management subsidiary, AfrexInsure, (together, “the Group”).
Ghana’s Finance Minister, Ken Ofori-Atta in his remarks said it is fitting that the commemoration of the Bank’s milestone for Africa’s key trade finance institution is co-organised by AfCFTA Secretariat, the Government and the people of Ghana who are determined torch bearers for Africa’s challenges.
“This is another opportunity to deepen cooperation and seek African solution to Africa’s challenges,” he stated.
Rex Mainoo Yeboah, ISD