The European Investment Bank (EIB) has formally agreed to support membership expansion of the African Trade Insurance Agency (ATI) with a concessional financing facility to cover the shareholding of three prospective members -- Cameroon, Niger and Togo.
This represents the first time the EIB has backed ATI’s membership expansion, the bank said in a statement issued earlier this month.
Unlocking additional investment insurance is expected to transform public and private sector investment in the countries. Investment insurance includes the full spectrum of political and credit risk insurance covering both sovereign and corporate risks.
The agreement between EIB and the ATI to enable the bank to finance membership of countries was signed on 11 November at the Africa Investment Forum in Johannesburg.
Mr Ambroise Fayolle, EIB vice president, said that the agreement will enable West African countries to benefit fully from ATI membership and from increased investment in sectors such as agriculture, energy, manufacturing and health. The EIB is committed to accelerating sustainable development across Africa.
Mr John Lentaigne, ATI acting CEO, said that the agency has a strategic focus to de-risk member countries in order to attract investment and promote growth. The EIB’s engagement to expanding ATI membership in West Africa will help to ensure that the prospective countries’ economies achieve their full potential and follow the success of ATI membership seen in so many other countries across Africa.
ATI membership will enable underlying projects to be bankable and able to attract new investors for strategic infrastructure and private sector projects.
Once the countries become full ATI members, investors will benefit from the full spectrum of investment insurance that protects against non-payment of both sovereign and corporate risks.
ATI membership has already helped other African countries to reduce sovereign borrowing costs. ATI currently insures $6bn of transactions across Africa as a current outstanding portfolio.
The agreement will ensure that projects follow international technical, environmental and social standards that further reassure international investors.