If the awaited formalization of Nigeria’s membership of the Africa Trade Insurance (ATI) is concluded before the end of this year, the country is looking to benefit from an estimated $5 billion premium income of the continental body, expert said.
The income is expected to come from political and commercial risk cover of investment and trade into the continent, according to Simba Chinyemba, head of actuary, Zenith General Insurance Limited.
The continental insurance agency was set up with the support of the World Bank, owned by African government and is registered under the United Nations treaty to provide insurance and promote economic growth in member countries
The investment risk insurer is owned by 14 African nations and other organisations such as the African Development Bank.
It was formed in 2001 with World Bank support to offer insurance for large investment and financing projects against risks such as sovereign default, war and insolvency, to spur investment by companies and private equity into Africa.
Major insurance projects on the continent insured by ATI include electricity generation projects in Kenya and a $200 million mining project in the Democratic Republic of the Congo.
In 2017, ATI recorded gross exposures of $2.4 billion and, in the same period, the company covered investment and trade activities across the continent valued at $10 billion. ATI also posted a $10 million profit representing a 55 percent increase over 2016.
ATI owes its strong results in part to growing demand from investors and African governments for their products as the continent continues to position itself as an attractive destination for investors. Africa’s drive to increase trade within its borders is also fuelling ATI’s success.
The African multilateral insurer also announced the Government of India’s $10 million shareholding, which will be represented by ECGC, India’s export credit agency.
Modestus Anaesoronye
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