5 December 2012

Zimbabwe: Afreximbank President Jets in for EGM

THE African Export and Import Bank will hold an Extraordinary General Meeting in Harare on Saturday to seek ways of recapitalising the regional bank in the wake of growing funding requirements to support African exports.

But sub-committees comprising shareholders and directors of the trade-oriented regional bank will meet today to map out the strategies to enhance support for African trade, now estimated at more than US$1 trillion.

Speaking during an interview shortly after his arrival at the Harare International Airport, the president and chairman of the bank, Mr Jean Louis Ekra, said trade among African firms had grown more than five times from US$200 billion in 1993.

Mr Ekra said the meeting in Harare would also consider pleas by Zimbabwe for funding to rebuild its frail industrial base.

"We are coming for the EGM which will be attended by shareholders and directors of the bank to look at ways to raise more capital to increase our efficiencies," said Mr Ekra.

"In 1993 (when Afreximbank was formed) the volume of trade was US$200 billion, but (export) trade has passed the US$1 trillion (yet) the bank's capital remains at US$750 million. That will be the agenda item of our meeting," he said.

This, said Mr Ekra, meant that there was a trade financing gap considering the volume had grown more than five-fold since 1993.

Since Zimbabwe is a shareholder, board member and beneficiary of lines of credit from the bank discussions will also centre on more efficient ways of disbursing the funding.

Afreximbank recently raised Zimbabwe's country borrowing limit to US$500 million from about US$300 million last year to revitalise the country's fragile export capacity.

Mr Ekra said authorities in Zimbabwe had achieved considerable progress in restoring the country's economic progress and that put the country in good stead to access more funding.

The bank availed US$50 million under the US$70 million Zimbabwe Export Trade and Economic Revival Fund while the Government chipped in with US$20 million for the facility.

Presenting the 2013 National Budget last month Finance Minister Tendai Biti said Afreximbank had agreed to extend an additional US$70 million for the second phase of the ZETREF facility.

This comes on the back of reports, following manufacturing survey conducted by the Confederation of Zimbabwe Industries that industrial capacity has dropped from an average of 57,2 percent in 2011 to 44,5 percent.

Challenges in the manufacturing and sector have resulted in a trade deficit of around US$3,5 billion and increasing reliance on imports.

Copyright © 2012 The Herald. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.