Afreximbank disburses $3.55bn to cushion impact of COVID-19, $300m to stimulate intra-African trade in Egypt
The African Export-Import Bank (Afreximbank), Africa’s foremost multilateral trade finance institution, has disbursed a total of $3.55 billion to the Egyptian Banking sector under its Pandemic Trade Impact Mitigation Facility (PATIMFA) since the outbreak of the pandemic in March this year. In its bid to strengthen long-term economic prosperity in the region the Bank has also provided $300 million to the National Bank of Egypt to support activities aimed at expanding intra-African trade.
The 3.55bn support has been provided to the Central Bank of Egypt and other Egyptian Banks through Afreximbank’s Pandemic Trade Impact Mitigation Facility (PATIMFA). PATIMFA is designed to assist Afreximbank member countries in managing the adverse impact of financial, economic and health shocks caused by epidemics or pandemics, in the nature of COVID-19.
By doing so, it helps preserve and promote economic stability through the period of global uncertainty. The funds ensure trade debt payments that fall due are honoured and supports the stabilization of foreign exchange resources in order to preserve the flow of critical imports. They will bolster the liquidity of the Central Bank and Local Egyptian lenders during the crisis, while ensuring vital trade in items such as food and medical supplies continues. In addition, Afreximbank has also provided a $250,000 grant to support the Egyptian government COVID-19 relief efforts.
The support provided to the National Bank of Egypt reflects Afreximbank’s continued commitment to promoting regional integration and intra-African trade—an area of development it deems vital both to the continent’s recovery from the pandemic and its long-term economic resilience. The funds will support the National Bank of Egypt’s operational expansion through investment and trade in Africa. It will also strengthen its Egypt-Africa Trade business, which aims to increase its support for regional trade from $85m in 2020 to $125m in 2022.
Prof. Benedict Oramah, President of Afreximbank, said: ''Faced with a sharp change in the economic outlook, banks in most countries, including Egypt, need to brace themselves for widespread economic disruption and a recession. The support we are providing to the banking system in Egypt will ensure trade continues and defaults are averted, bolstering the economic foundations needed to preserve public health and promote a strong recovery.''
''As we rightly focus on stability in the present, we must also look to build a more prosperous and resilient future. Egypt has been a regional banking powerhouse for more than a century and will play a vital role in expanding intra-Africa trade as the continent recovers from the pandemic and reaps the benefits of the African Continental Free Trade Area. The National Bank of Egypt’s balance sheet is among the top three strongest in Africa and we are confident its expansion will prove an effective multiplier for trade across the continent,'' he added.