In December 2023, the President of the African Export-Import Bank (Afreximbank), Prof. Benedict Oramah received the FORBES AFRICA magazine 2023 Person of The Year award.
“With a career spanning three decades at Afreximbank, Prof. Benedict Oramah is a true pan-Africanist,” Renuka Methil, Managing Editor of FORBES AFRICA said at the award ceremony in Cairo, which Dr. Rakesh Wahi, FORBES AFRICA Founder and Publisher, and Roberta Naicker, the Managing Director, said recognised the stellar accomplishments of leading Africans contributing to the development of the continent.
“Amongst many initiatives under his visionary leadership, Afreximbank launched the Pan-African Payment and Settlement System (PAPSS) which will be a historic project for cross-border payments in local African currencies. He is a resilient risk-taker and articulated so well what a new united Africa should, and would, look like,” added Ms Renuka Methil.
The Pan-African Payment and Settlement System is a cross-border, financial market infrastructure launched under Mr. Oramah’s leadership, aimed at enabling payment transactions across Africa.
PAPSS ensures instant or near-instant transfers of funds between originators in one African country and beneficiaries in another.
By introducing PAPSS, Oramah seeks to enhance financial inclusion opportunities and improved economic growth through intra-African trade, ease the pressure on current accounts and demands for foreign exchange liquidity.
Trades done through correspondent banks and money transfer systems cost Africans about $5bn in charges every year. PAPSS could save the continent $5bn in costs every year.
Founded in 1993 by African governments, African private and institutional investors, and non-African financial institutions and private investors, Afreximbank was established to finance, promote, and expand intra-African and extra-African trade. It is headquartered in Cairo, has branch offices in Harare, Zimbabwe and Abuja, Nigeria, and an authorized share capital of $750 million. The establishment of the Africa Continental Free Trade Agreement (AfCFTA in 2019 has provided the needed platform and impetus.
Since taking office as Afreximbank President in 2015, has led the bank to strengthen its institutional role and raise its profile as one of the main multilateral development banks (MDBs) focused on supporting public and private sectors in Africa. The improvement in the bank’s business profile follows Fitch’s 2022 revised assessment of the bank’s policy importance to ‘Low’ risk from ‘Medium’. This was primarily underpinned by the recent large capital increase, which highlights the increased importance of the bank for its shareholders. The increasing number of key mandates that the African Union has given the bank is further evidence of its rising profile.
Between 2016 and 2022, the Bank under Oramah’s leadership has disbursed more than US$86 billion. Afreximbank has investment grade ratings assigned by GCR (international scale) (A), Moody’s (Baa1), Japan Credit Rating Agency (JCR) (A-) and Fitch (BBB). Afreximbank has evolved into a group entity comprising the Bank, its impact fund subsidiary called the Fund for Export Development Africa (FEDA), and its insurance management subsidiary, AfrexInsure, (together, “the Group”).
In addition, to support its mission to stimulate a consistent expansion, diversification, and development of African trade, Oramah has led Afreximbank to establish partnerships in its African Trade Facilitation Programme (AFTRAF) with over 80% of Africa’s commercial banks. It is the world’s largest network aimed at strengthening relationships with African commercial banks, specifically to support trade within Africa.
In November 2023, Africa’s Global Bank, United Bank for Africa (UBA) Plc, has received a trade finance facility worth $150m from the African Export-Import Bank
The facility forms part of Afreximbank’s Ukraine Crisis Adjustment Trade Financing Programme for Africa (AKAFPA). The terms of the agreement state that the facility will be utilised to finance trade and trade-related transactions in support of UBA’s clients. In addition, the facility will aid increased financing of trade businesses in various sectors of the Nigerian economy thereby mitigating the adverse effects of the Russia-Ukraine crisis.
In December 2022, the Board of Directors of the bank approved US$1.5 billion funding to enable member states of the Caribbean Community (CARICOM) that have ratified the Partnership Agreement with Afreximbank to tap into the Bank’s various financial instruments.
The Board approval follows the accession of 9 CARICOM member countries to the Afreximbank Partnership Agreement which was launched on 1 September 2022, at the first Africa-Caribbean Trade and Investment Forum (ACTIF) held in Bridgetown, Barbados. Recently ratified by Barbados and in the process of being ratified by the other 8 signatories, the treaty remains open for accession to the 6 CARICOM members that have yet to sign.
Upon accession to the agreement, CARICOM member countries become Participating States in Afreximbank, conferring on the Bank the same privileges and immunities that it enjoys in the African Participating States that acceded to its Establishment Agreement. It unlocks the commencement of Afreximbank’s operations in the Caribbean.
The Partnership Agreement between Afreximbank and the constituent countries of CARICOM consolidates Benedict Oramah led efforts to promote and develop South-South trade and specifically trade between Africa and the Caribbean in line with its Diaspora Strategy. Afreximbank defines intra-African trade as the flow of goods and services between or among African countries as well as the flow of goods and services between Africa and Africans in the Diaspora.
In November 2022, Afreximbank announced that it was working to implement the African AfCFTA adjustment fund. The $10 billion fund is viewed as a key tool for achieving the goals of the AfCFTA. It aims to assist African businesses and financial institutions in acquiring the necessary resources and skills to enable free trade within the emerging trading bloc.
In December 2022, the Bank operationally launched the Afreximbank TRADAR Club, a prestigious member-driven network aimed at empowering international businesses and executives to transform trade and investments in Africa through trusted trade intelligence and advisory services.
TRADAR Club is anchored by Afreximbank’s Trade Intelligence Solutions Unit. The Unit was conceived to address one of the key barriers to intra-African trade – the lack of comprehensive African trade and investment information. Afreximbank’s Trade Intelligence Solutions is an end-to-end, integrated trade intelligence offering – supporting clients that are seeking to enter new markets in Africa or expanding into the continent. TRADAR Club and the Trade Intelligence Solutions it champions represent the single authoritative resource and forum for trade and investment related insight on the African continent.
Afreximbank described TRADAR Club as the primary gateway through which exporters, importers and investors will access curated trade intelligence and advisory services to support their market expansion decisions and network with other businesses.
TRADAR Club membership is open to global industry leaders, African and foreign businesses, intergovernmental organisations, policy makers and other influential stakeholders committed to the shared objective of unlocking growth and development in the African continent.
Oramah has also led Afreximbank to help African economies to manage the exodus of international banks by financing African owned financial institutions to acquire those banks, helping to build a strong interconnected African financial system.
“We are re-creating our banking systems so that they can serve Africa better. Our goal is to grant an aggregate of 8 billion US dollars in Trade Confirmation lines to these African banks and ensure that every country on our Continent has at least one bank that has a dedicated credit line to support intra-African trade,” Professor Benedict Oramah said.