<\/p>\n
The findings are contained in the fifth edition of the AfDB\u2019s Trade Finance Report, released during the Bank\u2019s 2026 Annual Meetings, which conclude on Friday, in Brazzaville.<\/p>\n
<\/p>\n
The report analyses developments in Africa\u2019s trade finance sector between 2020 and 2024, focusing on bank intermediation, while also introducing new areas such as digitalisation and environmental sustainability. It also provides a first assessment of the contribution of development finance institutions.<\/p>\n
<\/p>\n
The AfDB said unmet demand for trade finance declined by nearly 10% between 2019 and 2024. This improvement was supported by interventions from multilateral development banks, governments, export credit agencies and global financial institutions.<\/p>\n
<\/p>\n
Anthony Simpasa, AfDB Director of Macroeconomic Policy, Forecasting and Research, said these interventions helped sustain trade flows during a challenging period. Simpasa said that without support from development finance institutions, the trade finance gap could have exceeded $100 billion annually over the period.<\/p>\n
<\/p>\n
Despite this progress, the report warns that recent geopolitical tensions and global supply disruptions could reverse gains. Under a moderate to severe scenario, the trade finance gap could rise to between $86.6 billion and $102.6 billion by 2027, representing an increase of at least 17.7% from 2024 levels.<\/p>\n
<\/p>\n
The report estimates that unmet demand for trade finance in Africa ranged between $74 billion and $92 billion in 2024. The lower estimate represents about 5.4% of the region\u2019s total merchandise trade.<\/p>\n
<\/p>\n
Commercial banks continue to play a limited role in financing trade. Over the period studied, they intermediated an average of 23% of Africa\u2019s total trade, compared with 40% in the years before the pandemic.<\/p>\n
<\/p>\n
Intra\u2011African trade has increased, accounting for 34% of bank\u2011intermediated trade between 2020 and 2024. This represents an 89% increase compared with pre\u2011pandemic levels.<\/p>\n
<\/p>\n
The report identifies foreign exchange liquidity shortages as a major constraint. About 36% of banks cited this as the primary barrier to expanding trade finance, compared with 18% in the previous period.<\/p>\n
<\/p>\n
Adoption of digital trade finance solutions remains limited. Only 28% of surveyed banks reported using digital tools, with high costs and limited infrastructure cited as key challenges.<\/p>\n
<\/p>\n
Development finance institutions played a significant role in supporting trade. Between 2020 and 2024, they facilitated about $32 billion in trade finance annually, equivalent to around 3% of Africa\u2019s total merchandise trade.<\/p>\n
<\/p>\n
–AfDB\/ChannelAfrica–<\/p>\n","protected":false},"featured_media":35643,"template":"","meta":{"_acf_changed":false,"_links_to":"","_links_to_target":""},"news-type":[44],"class_list":["post-35700","news","type-news","status-publish","has-post-thumbnail","hentry","news-type-finance","entry"],"acf":{"short_description":"The African Development Bank (AfDB) says African financial institutions have shown resilience in the years following the COVID\u201119 pandemic, despite ongoing global economic challenges.","published_date":"","news_description":"The African Development Bank (AfDB) says African financial institutions have shown resilience in the years following the COVID\u201119 pandemic, despite ongoing global economic challenges.","form_embed":"","author":"","image_caption":""},"_links":{"self":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/35700","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news"}],"about":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/types\/news"}],"version-history":[{"count":1,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/35700\/revisions"}],"predecessor-version":[{"id":35701,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news\/35700\/revisions\/35701"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/media\/35643"}],"wp:attachment":[{"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/media?parent=35700"}],"wp:term":[{"taxonomy":"news-type","embeddable":true,"href":"https:\/\/www.channelafrica.co.za\/channelafrica\/wp-json\/wp\/v2\/news-type?post=35700"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}