By Franklin Alli
” The three areas we want to support with our capital injection are businesses that are involved in infra – African trade value chains, companies that are involved in some value additions such that if you are involved in the production of cocoa, and exporting cocoa paste. We want to work with you to enable you to produce chocolate and export chocolate.”
Emmanuel Assiak, Acting CEO of the Fund for Export Development in Africa (FEDA), a subsidiary of the African Export-Import Bank (Afreximbank), told stakeholders today during the Arbiterz Media Ltd’s webinar on AfCFTA: Revamping Nigeria’s Infrastructure for Global Trade.’
” We also want to work with companies to forward integrate raw commodities into industrialized products that can be sold locally or regionally.
” We have Afreximbank behind FEDA with about $350 million in initial funding to support different buckets of funding opportunities. We are actively looking at opportunities to deploy the capital; we have 100 million dollars that we are working with, and we are actively looking at an opportunity to deploy the capital,” he said.
He explained that FEDA was established to facilitate foreign direct investment flows into Africa’s trade and export sectors through the provision of equity financing.
“Structurally, we have an infrastructure gap, we also have a gap around funding, we see funding coming into Africa are not being deliberately directed to address the specific areas that create value addition moving Africa from raw commodity production by getting into manufacturing, people pick sectors that they want to invest in,” he said.
What sectors do we invest in?
We invest in every sector provided we find an angle to grow the Intra -African trade or growth in value-added export outside of Africa.
So the three sectors that we exclude for now are two of them are in the refractive industry, we won’t invest in oil and gas, and mining for now and the third is power.
The reason is that they do not lend themselves directly to the FEDA objectives. Over time, we expect FEDA’s support to intra-African trade to help grow the 17% intra-African regional trade number to a number that is more comparable with what is obtained in other regions as earlier discussed. We also aim to see the contribution of Africa to global trade from the current 2% to about 6%. That’s what we are looking for.
” However, if you are providing power into a special economic zone, we can look at that. We can invest from $5 to 20 million dollars for between seven and ten years and even longer,” he added.