Afreximbank plans initiative to help address foreign exchange liquidity challenge
- B&FT Online | Ghana
- Aug 10, 2015
- 4 min read
The African Export-Import Bank (Afreximbank) has announced a proposal to introduce foreign exchange swap-arrangements aimed at advancing the availability of foreign exchange to the Bank of Ghana as part of a foreign exchange liquidity support for imports into Ghana.
Dr. Benedict Oramah, President Designate of the bank, who made the announcement on Friday in Accra during a meeting with Seth Terkper, Ghana’s Minister of Finance, said that the initiative is part of a country assistance programme Afreximbank is developing to help Ghana address the economic challenges it is facing as a result of the recent global financial crisis.
Dr. Oramah said that as part of the country assistance programme, Afreximbank plans to support Ghanaian banks engaged in trade finance to meet temporary foreign exchange shortfalls with an initial investment of US$200million; expand lines of credit to Ghanaian banks to enable them finance imports of essential goods, including energy generation; and pursue the ongoing discussion with the Volta River Authority to provide it with additional funding of up to US$300million to enable it to continue paying for feed-stock imports and to clear arrears to local banks.
Afreximbank will also increase its support to Ghana under its Export Development Programme; help the country enhance its trade supporting infrastructure, including power generation, and also help boost its service exports, particularly in the tourism sector, he added.
Dr. Oramah, who explained that the bank’s decision to scale-up intervention in the country is in recognition of the opportunities offered by the relatively stable socio-political and economic environment, stated that Afreximbank has approved credit facilities amounting to about US$2billion to the Ghanaian government, corporates and financial institutions since its inception in 1993.
The facilities included US$150million to the Volta River Authority to support capacity expansion and refurbishment activities; US$70million for a Ghanaian company to enable it offer mining and engineering services to international mining companies; US$250million for the Bank of Ghana to address short-term liquidity challenges; and US$70million to two Ghanaian-owned cocoa processing companies, he said.
Mr. Terkper welcomed the proposal by Afreximbank and said that the programme fits into the country’s economic strategies and plans.
He announced that government has reached an advanced stage in the establishment of a Ghana Export-Import Bank, and requested that Afreximbank support and contribute to the new entity.
The meeting is part of an ongoing engagement between Afreximbank and the Ghanaian authorities, which has seen an Afreximbank team led by Dr. Oramah visit Ghanaian President John Mahama on 3 July and Ghanaian Vice-President Kwesi BekoeAmissah-Arthur visit the Afreximbank Headquarters in Cairo on 5th August.
Dr. Oramah was accompanied on to the meeting by Kofi Adomakoh, Director of Afreximbank’s Project and Export Development Finance Department; Joy Albright of the Legal Department; and Remigius Nwachukwu of the Abuja Branch Office.
The African Export-Import Bank (Afreximbank) has announced a proposal to introduce foreign exchange swap-arrangements aimed at advancing the availability of foreign exchange to the Bank of Ghana as part of a foreign exchange liquidity support for imports into Ghana.
Dr. Benedict Oramah, President Designate of the bank, who made the announcement on Friday in Accra during a meeting with Seth Terkper, Ghana’s Minister of Finance, said that the initiative is part of a country assistance programme Afreximbank is developing to help Ghana address the economic challenges it is facing as a result of the recent global financial crisis.
Dr. Oramah said that as part of the country assistance programme, Afreximbank plans to support Ghanaian banks engaged in trade finance to meet temporary foreign exchange shortfalls with an initial investment of US$200million; expand lines of credit to Ghanaian banks to enable them finance imports of essential goods, including energy generation; and pursue the ongoing discussion with the Volta River Authority to provide it with additional funding of up to US$300million to enable it to continue paying for feed-stock imports and to clear arrears to local banks.
Afreximbank will also increase its support to Ghana under its Export Development Programme; help the country enhance its trade supporting infrastructure, including power generation, and also help boost its service exports, particularly in the tourism sector, he added.
Dr. Oramah, who explained that the bank’s decision to scale-up intervention in the country is in recognition of the opportunities offered by the relatively stable socio-political and economic environment, stated that Afreximbank has approved credit facilities amounting to about US$2billion to the Ghanaian government, corporates and financial institutions since its inception in 1993.
The facilities included US$150million to the Volta River Authority to support capacity expansion and refurbishment activities; US$70million for a Ghanaian company to enable it offer mining and engineering services to international mining companies; US$250million for the Bank of Ghana to address short-term liquidity challenges; and US$70million to two Ghanaian-owned cocoa processing companies, he said.
Mr. Terkper welcomed the proposal by Afreximbank and said that the programme fits into the country’s economic strategies and plans.
He announced that government has reached an advanced stage in the establishment of a Ghana Export-Import Bank, and requested that Afreximbank support and contribute to the new entity.
The meeting is part of an ongoing engagement between Afreximbank and the Ghanaian authorities, which has seen an Afreximbank team led by Dr. Oramah visit Ghanaian President John Mahama on 3 July and Ghanaian Vice-President Kwesi BekoeAmissah-Arthur visit the Afreximbank Headquarters in Cairo on 5th August.
Dr. Oramah was accompanied on to the meeting by Kofi Adomakoh, Director of Afreximbank’s Project and Export Development Finance Department; Joy Albright of the Legal Department; and Remigius Nwachukwu of the Abuja Branch Office.
