NAIROBI, Kenya, Aug 3 – The African Development Bank (AfDB) has pumped in a Sh1.2 billion equity investment in the African Trade Insurance Agency (ATI) in efforts to help shore up the region’s integration initiatives.
ATI Chief Executive Officer George Otieno said the capital injection increases the Agency’s insurance capacity allowing it to leverage up to 10 times to cover Sh135 billion worth of transactions in its nine member states.
“This investment is quite significant, and is the highest investment AfDB is making in any institution in Africa. With the AfDB investment, ATI’s capital will get to the region of $200 million,” he said.
AfDB will also finance ATI’s membership expansion plans, which will see the firm rope in Ghana and Benin by the end of the financial year to add Sh2.5 billion to its capital base.
AfDB Regional Director for East Africa Gabriel Negatu said that though the investment will go to enhancing intra-regional trade in Africa, the continent’s infrastructure which is in need of major improvements should be a priority to ensure trade can be facilitated smoothly.
“Africa’s demand for infrastructure is almost insatiable at $93 billion per year. This amount is clearly beyond the means of both the public and private sectors, and new investors must be attracted to the continent to fill this financing gap,” he said.
The AfDB is the financier behind the East African Community Strategy, a 10-year programme that will identify short to medium term interventions required to develop transport infrastructure in the region covering Civil Aviation, Railways, Ports and Maritime, Inland Waterways and Roads.
With the AfDB having set up its regional resource center in Nairobi covering the Bank’s operations across 13 countries in the greater East African region, Negatu expects the move will increase its portfolio.
“This enables the Bank to be more responsive to the needs of its clients. The qualitative improvement is something you’ll notice. We’re completing projects much faster and under budget,” he said.