Absa Secures $150m Finance Facility to Close Africa Trade Finance Gap

Samuel Mobolaji

Absa said, it has secured a $150 million facility from British International Investment (BII) Plc as part of its mission to help close the trade finance gap in Africa.

BII is the UK’s Development Finance Institution (DFI) and impact investor, focused on providing patient capital to foster productive, sustainable, and inclusive economies. Absa, as the borrower in this transaction, will utilise the funds to support this objective, with a specific focus on the African continent.

Head of FI Trade Sales (International), Risk Distribution, and Syndication at Absa CIB, Mosa Tshabalala said, “our unyielding commitment to the success of the continent continues to drive us to find solutions to serve our customers by addressing Africa’s trade finance gap, focusing on sustainable funding.”

Tshabalala stated that, “our role as a Pan-African bank is to channel the funds to reach our client base across our chosen markets. We continue to forge partnerships with DFIs, insurance companies, other commercial banks (locally, regionally, and globally), ECAs, and institutional investors to drive market access and provide the funding necessary to support our customers’ growth ambitions.”

He explained that, Africa’s trade finance gap is estimated to be between $100 billion and $120 billion, saying, by partnering with BII, Absa is making strides in advancing the efforts of the African Continental Free Trade Area (AfCFTA) agreement, which aims, among other objectives, to reduce the continent’s trade finance gap.

He added that, this transaction will enable Absa to extend liquidity to clients across various geographies and trade product sets that are in high demand.

Also, Interim Group chief executive officer at Absa, Charles Russon pointed out that “our extensive presence across the continent, combined with our global reach, enables us to facilitate the flow of capital and trade finance that African businesses need to scale and compete internationally.

“By leveraging our cross-border expertise and strategic partnerships, we are driving sustainable growth and creating new opportunities in emerging markets, contributing to the broader development of Africa’s economic ecosystem.”

The UK’s Development Minister Anneliese Dodds said, “I am happy to see BII support Absa through this important facility, which is part of a long-standing partnership to help fill Africa’s estimated $100 billion to $120 billion trade financing gap. Today’s signing demonstrates BII and Absa’s continued commitment to addressing that pressing challenge together, focusing on sustainable and inclusive economic growth.”

Director, jead of Trade & Supply Chain Finance, BII, Admir Imami added that, “we are delighted to continue our partnership with Absa which is based on a shared ambition to progress inclusive and economic development, particularly for underserved groups including SMEs and women. The facility combines BII’s long history of support in Africa with Absa’s cross-border expertise, which will help to make trade finance more accessible to African businesses and improve the vital flow of essential goods including food.”