Africa’s desire for sustainable economic growth is unattainable without strong development finance institutions, Ghana’s President Nana Akufo-Ado has said.
He spoke at the ongoing 30th Annual General Meetings of the African Export-Import Bank, Afreximbank, in Accra, where the Bank’s President Benedict Oramah said the Pan-African financial institution was living up to the expectations of its founding fathers.
Akufo-Addo told participants that Africa’s financial development institutions had remained highly undercapitalized, saying they needed to be boosted and have effective coordination with the African Union in order to be able to deliver effectively for the continent.
Citing the China Exim Bank with a $54 billion capital base, he said Afreximbank’s $6 billion was too inadequate to meet its objectives and called on African countries and Africans to raise the shareholders by subscribing to their allotted shares.
Akufo-Addo commended Afreximbank for its catalytic role in Africa and urged it to strive to further improve its rating with the credit rating agencies in order to enhance its operations and be able to work consistently for Africa and the African Diaspora.
He pledged to work for the Bank to be admitted to a special status at the AU in recognition of its role and contributions to the continent. describing AAM2023 as a truly intercontinental event with the participation of several Caribbean countries that had become full members.
He appreciated the Bank’s support for Ghana, noting that its first transaction was with the Ghana Cocoa Board, adding that, Afreximbank had provided timely support to Ghana through its Counter-Cyclical Liquidity Facility (COTRAFL) which it had put together at a time when global financial institutions were exiting Africa.
“When dealing with powerful global financial institutions, it is important to have your own powerful financial institutions,” Akufo-Ado said.
Oramah, in his opening speech, had said that the Bank was achieving OAU’s aspiration for Africa’s socio-economic transformation.
According to him, the Pan-African Bank’s goals were to establish a free trade area among the various African countries; establish a Pan-African Payments and Clearing Union; establish a common external tariff to protect the emergent industries and set up a raw material price stabilisation fund; develop trade among African countries by the organisation and participation in African trade fairs and exhibitions and by granting transport and transit facilities; and progressively free national currencies from all non-technical external attachments and the establishment of a Pan-African monetary Zone.
“For sixty years, this well-articulated road map remained a map and gathered dust,” Oramah said, adding, “But thanks to the vision of African leaders who founded Afreximbank 30 years ago, one by one, they are being delivered within the framework of ‘Team Africa’, comprising the African Union and its Agencies, the AfCFTA Secretariat and Afreximbank as the underpinning banker”.
He counted the Bank’s blessings: “Today, the Pan-African Payment and Settlement System (PAPSS) is up and running, which will save the continent 5 billion US dollars in intra-African transfer changes. It will also expedite and enable payments for intra-African trade in African currencies.”
Oramah further stated: “Very soon, we will domesticate all intra-African payments and extend the same to the CARICOM, where just a few days ago, the Association of CARICOM Central Banks adopted PAPSS as their preferred payment infrastructure for a pilot project. By this singular move, we are one step closer to full integration of African and CARICOM economies”.
He added that, in response to the founding fathers’ aspiration to develop trade among African States by organising and participating in African trade fairs, Afreximbank, in 2018, worked in partnership with the African Union to introduce biennial Intra-African Trade Fairs (IATF). Afreximbank pre-funded the organisation of the trade fairs, of which two had been held in Cairo and Durban, South Africa, attracting an aggregate of about 40,000 visitors and about 75 billion US dollars in deals.
The AAM2023 being also held to celebrate the 30th anniversary of the establishment of the Bank, which was founded in 1993 ends tomorrow, and is being attended by political and business leaders, bankers, and other trade and trade finance practitioners from across Africa and beyond, including leaders of several member countries of the Caribbean Community.
