Afreximbank wants Egypt to adopt transit guarantee scheme

By David Whitehouse
Posted on Wednesday, 17 March 2021 15:07

View of Afreximbank's headquarters in Cairo/RIGHTS RESERVED

African Import-Export Bank aims to get Egypt on board its new transit guarantee scheme designed to reduce trade costs, says Kanayo Awani, the bank’s managing director for intra-African trade.

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.