Afreximbank Partners FCSSC, MIAI for $1 billion fund to Support Industrialization, Boost Africa-South Cooperation
The African Export-Import Bank (Afreximbank), the Finance Center for South-South Cooperation (FCSSC) and the Made-in-Africa Initiative (MIAI) have announced a joint effort to mobilise $1 billion in equity fund to channel foreign direct investment from developing (South) economies towards Africa’s industrialization and integration into global value chains.The framework agreement executed by the three organisations in Beijing recently, mark the establishment of a strategic partnership among the institutions aimed at leveraging diversified financial instruments and resources to boost Africa’s industrialization and expand China-Africa economic and commercial cooperation The objective of the arrangement is to develop a common investment platform anchored on Afreximbank in order to reduce investment risks and better support Africa’s industrialization and dynamic development. The platform is expected to attract investment capital from the public and private sectors and to facilitate the flow of foreign direct investment from China and other South economies into manufacturing and other value-added activities in Africa. The agreement also provides for the setting up of institutional trading platforms for commodities and manufactured goods to promote intra-African trade and export from African countries to countries within the continent and the global South. The three organizations will make full use of Hong Kong’s role as an international services and trading hub to bridge the information gap between the Chinese and African markets, in order to better balance trade flows between China and Africa. They will, in addition, explore the establishment of e-commerce trading platforms to facilitate the transformation from traditional offline business-to-business and business-to-customer transactions to online mode, especially with regard to small and medium-sized enterprises in Africa. This will enable the enterprises to access new markets, participate in global value chains, and reduce intermediate transaction costs. Read more on Financial Afrik.