AfDB approves $50m and EUR50m for EBID

The African Development Bank Group (ADB) has approved a $100 million Trade Finance Line of Credit for the ECOWAS Bank for Investment and Development (EBID), which will serve as an important source of financing for local corporates in the West Africa region. The dual-currency facility, which is comprised of $50 million and EUR 50 million, has received additional co-financing of $30 million from the People’s Bank of China through the Africa Growing Together Fund (AGTF).

EBID will utilize this three-and-a-half-year facility to provide direct financing to local corporations, with a portion of the credit line being channeled through select local banks for on-lending to key sectors such as agriculture, infrastructure, and transport. The end beneficiaries of this financing will be small and medium-sized enterprises (SMEs), local enterprise cooperatives, and farmers in the West Africa region.

The ADB recognizes the critical role played by regional development finance institutions like EBID in promoting trade and regional integration. The Bank’s Head of Trade Finance, Lamin Drammeh, spoke on the importance of supporting trade finance in the ECOWAS region, saying, “We are excited to work with EBID to increase access to trade finance in the ECOWAS region with a special focus on the agriculture value chain, SMEs, and women-owned businesses.” He added, “Regional institutions like EBID complement the Bank’s efforts to bridge the trade finance gap in Africa and serve as an effective conduit for channeling much-needed funds to underserved countries and sectors.”

EBID, as the financial arm of the Economic Community of West African States (ECOWAS), operates through two windows, private sector operations, and public sector operations, and supports infrastructure and other projects aimed at promoting regional integration in its member countries, which include Benin, Burkina Faso, Cape Verde, Côte d’Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo.

The ADB estimates that the annual trade finance gap for Africa is around $81 billion, and SMEs and other domestic firms have greater difficulty in accessing trade finance compared to multinational corporations and large local corporations. The approval of this facility marks the ADB’s first financing support to EBID and the bank looks forward to strengthening its partnership with the development finance institution in the near future.