Afreximbank has launched a $1bn continent-wide transit guarantee scheme designed to promote African trade, beginning with a pilot $200m agreement covering the Common Market for Eastern and Southern Africa (COMESA), which was signed on 10 March.
The aims are to improve tax collection for African states and free up working capital that would have been tied up as collateral for transit bonds. The scheme will ensure that when goods do not complete their transit, the duties and taxes that would have been required are still paid. Afreximbank will provide transit bonds covering the borders that goods are required to cross.
