An Angolan bank, Banco de Fomento Angola (BFA) has signed on to the African Export-Import Bank (Afreximbank) Trade Facilitation programme (AFTRAF) for an initial $50 million line of credit, thus becoming the first Angolan bank to sign on to the programme designed to support African banks to bridge the gap created by the withdrawal of international correspondent banks from the continent.
BFA will use the AFTRAF line of credit to confirm letters of credit and to issue guarantees, avalisation and other trade enabling products, said Afreximbank in an announcement in Cairo today. The line could also be increased based on demand from the Angola market.
According to the announcement, the AFTRAF programme provides access to a global network of confirming banks and complements the capacity of African banks to provide trade financing solutions by providing risk mitigation in new or challenging markets where trade lines may be constrained.
The AFTRAF programme is expected to help African importers and exporters to increase their trade volumes with African counterparties and internationally and to enhance confidence in the settlement of international trade transactions for critical imports into Africa while ensuring access to trade finance at reasonable cost.
So far, 100 Banks from 26 Afreximbank member countries have signed on to the AFTRAF.
The signing of the AFRAF facility by BFA is part of ongoing cooperation between Afreximbank and BFA as both are actively engaged in other areas in support of the Angolan economy.