The Board of Directors of the African Development Bank Group has approved a $50 million Trade Finance Transaction Guarantee facility to support the trade finance activities of CRDB Bank Plc in Tanzania.
This facility will enable the Bank to provide a guarantee of up to 100 percent to confirming banks for the non-payment risk arising from the confirmation of Letters of Credit and similar trade finance instruments issued by CRDB Bank Plc in Tanzania. The facility will provide much needed import trade finance requirements to Small and Medium Sized Enterprises (SMEs) and local corporates in Tanzania. It will also support intra-Africa trade, thus directly contributing to the successful implementation of the African Continental Free Trade Area (AfCFTA) agenda.
Following the approval, African Development Bank Head of Trade Finance, Lamin Drammeh noted that supporting trade in Africa is a key priority at the African Development Bank.
"Trade finance is essential for Africa's economic development, facilitating both domestic and international trade, boosting economic growth and promoting regional integration. We are delighted to work with CRDB Bank Plc., a strong partner with extensive knowledge and network in Tanzania, on a shared ambition of supporting the region's Trade," Drammeh said.
Commenting on the approval, Abdulmajid Mussa Nsekela, Group CEO and Managing Director of CRDB Bank Plc., said he was honoured by the trust placed in the bank by the African Development Bank through this facility. "This strategic partnership enhances our capacity to support the trade finance needs of SME and Corporate sectors that are the backbone of our economy and pivotal in driving inclusive and sustainable growth."
Nsekela added: " SMEs and corporates are the drivers of industrialization, job creation, and regional integration, and this facility will help remove long-standing barriers to their participation in global and regional trade. This facility strengthens our resolve to foster regional trade and contribute meaningfully to the AfCFTA vision of a connected and prosperous Africa."
