• Tuesday, May 28, 2024
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BII, Citi invest $100m to meet African SMEs’ finance needs

BII, Citi invest $100m to meet African SMEs’ finance needs

British International Investment, a UK development finance institution, has approved a $100 million risk-sharing facility with Citi, an American multinational investment bank, to support the trade finance needs of African small and medium enterprises and corporates.

This was announced during a signing ceremony in Washington at the World Bank’s spring meetings last Wednesday.

“This is expected to provide a boost to businesses with high potential but limited by a lack of finance,” the statement said.

It added that the investment would address the lack of foreign currency in the region by providing trade finance liquidity to Citi’s extensive network of commercial banks, enabling financial institutions to support African businesses with imports of key commodities.

Nick O’Donohoe, CEO of BII said the company’s investment with Citi deepens BII’s footprint across the continent and supports local businesses struggling to maintain and expand operations due to a lack of capital.

“The facility is a testament to our commitment to tackling complex issues such as food security in Africa by extending liquidity solutions to strategic sectors. This empowers local businesses to strengthen supply chains and accelerate the flow of essential trade,” he said.

Stephanie von Friedeburg, head of DFI strategic partnerships at Citi said the company is proud to work with BII in seeking to strengthen trade, and food security in frontier and emerging African economies.

“At Citi, we understand the transformative potential of global trade and are committed to bringing solutions that facilitate critical investments to enable economic growth,” she said.

According to BII, as a result, the trade finance gap in Africa has increased by approximately a third since the onset of the pandemic, climbing from $81 billion in 2019 to $120 billion in 2023.