The Nigerian Export-Import Bank has entered into a $1bn trade facilitation pact with the African Export-Import Bank for Nigeria and other West African countries.
A statement from NEXIM Bank on Monday explained that the MoU would be implemented under the Nigeria-Africa Trade and Investment Promotion Programme to support trade and investment flows between Nigeria and other African countries.
The signing of the Memoradum of Understanding was one of the high points of events during the inaugural Intra-African Trade Fair in Cairo, Egypt.
According to the MOU, the fund is available to support growth of trade between Nigeria and other African countries with special emphasis on value addition, particularly in primary goods and commodities. The statement said the $1bn would assist in enhancing local earnings and job creation.
Under the agreement, AFREXIM will provide $1bn Line of Credit, which will be disbursed by NEXIM to qualifying beneficiary projects and transactions in support of intra-African trade and investments.
The fund, it added, was also available to support capital and investment flows as well as projects being sponsored by Nigerians in other countries.
While speaking during the signing, the Managing Director/Chief Executive of NEXIM, Abba Bello, said the deal would go a long way in boosting access of Nigerian exporters to investment capital and investment guarantee instruments, including the Small & Medium Enterprises. He said through the pact, the bank would be able to promote intra-African trade and increasing the volume of formal trade.
In implementing this programme, the MD also highlighted that the NEXIM bank would be working with all stakeholders, including exporters, investment partners as well as other financial institutions, both domestic and foreign to realise the NATIPP programme objectives.
The Nigerian Export-Import Bank (NEXIM) was established by Act 38 of 1991 as an Export Credit Agency (ECA) with a share capital of N50, 000,000,000 (Fifty Billion Naira) held equally by the Federal Ministry of Finance Incorporated and the Central Bank of Nigeria. The Bank which replaced the Nigerian Export Credit Guarantee & Insurance Corporation earlier set up under Act 15 of 1988.
The Bank presently provides short and medium term loans to Nigerian exporters. It also provides short term guarantees for loans granted by Nigerian Banks to exporters as well as credit insurance against political and commercial risks in the event of non-payment by foreign buyers. The Bank is also the government’s National Guarantor under the ECOWAS Inter-state Road Transit programme.