“This ground-breaking project is a bold step towards improving the competitiveness of cross-border trade as we announce the historic issuance of the first-ever multi-border transit bond on the continent, and the signing of other facilities that will revolutionise the transit of goods in Africa forever,” Professor Benedict Oramah, President and Board Chairman of the Board of Directors, Afreximbank, said.
Speaking at the launch of the ongoing Intra-African Trade Fair (IATF) 2023 here on Sunday, he said, “We are happy that this innovative collaboration between the Bank and COMESA has yielded the desired result of issuing a single transit bond that makes it possible for the movement of goods across the continent without hindrance.”
Afreximbank in 2021, he said, joined the COMESA Regional Customs Transit Guarantee (RCTG) Scheme as a Regional Surety, which allowed the bank to issue single transit bonds that were acceptable across all countries in COMESA and also guarantee bonds issued by other sureties within the region.
“The AACT+GS brings us closer to transforming our continent into a single, integrated market. It is a realisation of the aspirations of our fore leaders, who, about six decades ago at the inaugural meeting of the Organisation of African Unity (OAU), saw the need for strong continental integration through trade,” he said.
Today, we celebrate the issuance of the first-ever multi-border transit bond in Zambia under the US$10 million facility to Innovate General Insurance (IGI). I am also pleased to announce the provision of US$300 million by Afreximbank to ZEP Re to boost the COMESA Regional Customs Transit Guarantee (RCTG) Pool,” he said.
This substantial financial injection, Prof. Oramah said, underscored the bank’s commitment to bolstering the capacity of the COMESA RCTG Pool, which would instil confidence in traders and businesses, thereby paving the way for increased trade volumes in the region and creating a conducive environment for investment, innovation, and economic growth.
The bank, he said, would be signing a US$30 million Container Guarantee Facility with BSMART System Solutions, which he described as another significant step forward in the realm of international trade and commerce.
A bonded shipment is a shipment that reaches its final destination country by way of one, or more, countries. Since it won’t be consumed or used in any of the countries traversed along the way, bonded cargo doesn’t officially undergo customs clearance until it reaches its destination country.
“In a world where the movement of goods across borders is the lifeblood of our economies, efficient handling of containers is paramount. This will revolutionise the way we manage containers, ensuring their safe and timely transit while minimising risks and enhancing security measures. The provision of financial guarantees for containers will encourage investment and make international trade more accessible and inclusive for businesses of all sizes,” he said.
Under Afreximbank support, he said, BSMART System Solutions would also establish 38 Integrated Customs Designated Stop Areas (ICDSA) across the EAC region.
These ICDSAs, he said, would offer various services, including secure truck parking, customs documentation verification, logistics hubs, container yards, vehicle inspection centres, and affordable housing estates.
“The primary objectives of these ICDSAs are to boost economic growth in the countries, enhance socio-economic conditions, and improve cargo security and transit controls. Under this mandate, Afreximbank will provide financial support of up to US$ 1.3 billion to BSMART and will act as the financial advisor for the Project,” he said.
Mr Wamkele Mene, Secretary General of the Continental Free Trade Area (AfCFTA), described the launch of the scheme as a landmark that would improve intra-African trade.
FROM DAVID ADADEVOH, CAIRO, EGYPT
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source: GhanaianTimes