Maravi

Ekra urges innovative financial instruments

Ekra urges innovative financial instruments
By Fridah Zinyama
Thu 26 Nov. 2009, 04:00 CAT

AFRICAN Export-Import Bank (Afreximbank) president Jean-Louis Ekra has said there is an urgent need to continue developing innovative financial instruments to support the rapidly expanding trade and investment flows between Africa and its trading partners.

During the just-ended two-day annual Afreximbank seminar on advanced structured trade finance at Intercontinental Hotel in Lusaka on Tuesday, Ekra said there had been growing trade between Africa and countries in the South like Brazil, India and China given the enormous benefits their rapidly expanding markets offered African traders.

“There is also need to improve efficiency and reduce the risks associated with the financing of African commodities in the absence of less risky state backed commodity boards and to grapple with adverse effects of foreign exchange and commodity price volatilities in international markets,” he said.

Ekra said there was also need to support national efforts at promoting local content in Africa’s extractive industries and also to expand local currency financing as many African economies stabilised.

“This will help to enhance or facilitate Africa’s participation in the emerging global carbon markets through the development of deal structures that rely on the sale of carbon credits arising from Clean Development Mechanism (CDM) projects,” he said.

Ekra further said there was also need to develop a banker’s acceptance market as a vehicle for promoting intra-Africa trade and to promote an African Letter of Credit and Correspondent banking arrangement so that African banks could help African traders to compete in the international market, among other agencies.

“It is in consideration of the forgoing that this year’s seminar programme seeks to deepen participants understanding of innovative instruments and structures that could be deployed to address some of challenges and the opportunities they offer African entrepreneurs,” said Ekra.

Labels: AFREXM, FINANCING

posted by MrK @ 10:58 AM