The African Development Bank (AfDB) and FSDH have signed a new $20 million Trade Finance Facility to support Small and Medium Enterprises (SMEs) in Nigeria.
Mr Lamin Barrow, Director-General, Nigeria Country Department, AfDB, said this during the signing ceremony on Thursday in Lagos State.
Barrow emphasized the pivotal role of trade in economic development, likening trade financing to its lubricant while explaining that the recently signed $20 million facility includes a $15 million Trade Finance Line of Credit dedicated to assisting eligible SMEs and corporates engaged in international trade value chains.
Additionally, it incorporates a $5 million Transaction Guarantee aimed at strengthening FSDH’s Correspondent Banking relationships.
While acknowledging the constraints in the supply of trade finance in Africa, Barrow highlighted the AfDB’s support for more than 120 financial institutions across 30 African countries, resulting in the catalysis of over $10 billion in trade over the past decade.
Speaking on the deal, Mr. Barrow said, “FSDH and the AfDB have enjoyed an enduring partnership in supporting SMEs and Nigerian Corporates engaged in trade and export value chains.”
“In 2016; the AfDB extended a $50 million Trade Finance Line of Credit to FSDH. This 3.5–year Facility performed well.”
“It supported more than 370 transactions, catalysed $375 million of trade and benefitted 60 SMEs and Corporations in critical sectors including energy, agri-business, health and boosting intra-Africa trade” he disclosed.
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