The five-year facility will allow Exim Bank Djibouti to finance eligible imports required by businesses operating in manufacturing and green energy.
Financing will support the import of production inputs, industrial machinery and telecommunications equipment. The operation will also facilitate imports of essential goods, contributing to food and nutrition security. “This facility will enable the Bank to provide guarantees of up to 100% to confirming banks,” AfDB Trade Finance Division Head Lamin Drammeh said.
The guarantees will cover risks associated with letters of credit and similar trade-finance instruments issued by Exim Bank Djibouti for eligible local businesses.
By reducing the risk faced by confirming banks, the facility is expected to increase the financing available for Djiboutian companies participating in international trade.
The AfDB said the operation would support Djibouti’s industrialisation by helping businesses secure the equipment and materials needed to expand production.
The facility will benefit large local companies and small and medium-sized enterprises, including businesses led by women.
Priority will be given to projects considered less vulnerable to climate risks and activities with limited greenhouse-gas emissions.
Exim Bank Djibouti Managing Director Jacky Kayiteshonga welcomed the agreement, which expands AfDB’s existing relationship with parent company Exim Bank Tanzania. “This partnership is in line with the Exim Group’s strategy, of which financing international trade is one of the main pillars of our intervention strategy in East Africa,” Kayiteshonga said.
AfDB’s Board of Directors approved the facility in Abidjan on October 7.
The financing aligns with AfDB’s 2023-2027 Country Strategy Paper for Djibouti, which prioritises socioeconomic infrastructure development in the energy and transport sectors.
The partnership is expected to help Djiboutian companies obtain productive inputs, expand industrial activity and participate more effectively in regional and international trade.
–AfDB/ChannelAfrica–
