AFRICA – CDC Group, the UK’s development finance institution and impact investor, has committed an additional US$100 million commitment to its existing master risk participation agreement with Standard Chartered.
This new commitment comes at a particularly challenging time as the COVID-19 pandemic has created severe liquidity pressures for banks and businesses across Africa and South Asia, exacerbating the existing pressure on trade finance availability as international banks limit their risk appetite.
In this context, development finance institution capital becomes even more critical to maintain trade flows and support economic growth.
“We continue to ramp up our trade finance programme as part of CDC’s “Strengthen” pillar response to COVID-19,” Admir Imami, Director, Head of Trade & Supply Chain Finance, CDC, said.
“This investment will help protect jobs, support economic growth and ensure vital goods get to those most in need.”James Duddridge – Minister for Economic Development, FCDO
“Our partnership with Standard Chartered Bank will support vital trade and supply chains in sub-Saharan Africa and South Asia, thereby protecting jobs and economic growth. Our trade finance programme aims to alleviate poverty, and ensure vital goods get to those that need it most across our markets.”
According to Africa Global Funds, the increase in commitment will provide Standard Chartered with systemic liquidity to directly support trade lines to local banks across South Asia and sub-Saharan Africa.
The capital will be channelled into some of Africa’s most fragile countries and will address major challenges in the food & agriculture and healthcare sectors as they benefit from preferential terms.
“We are delighted to partner with CDC on this initiative, which will enable us to support business sectors across sub-Saharan Africa and South Asia that are impacted by COVID-19, as well as provide them with the much-needed access to trade finance in these challenging times,” Nicolas Langlois, Global Head, Trade Distribution, Standard Chartered, said.
“This is not only testament to our commitment to be there for good for our clients and the community, but more importantly, to continue to play a role in facilitating trade flows for businesses that are the life-blood of their local economies.
This deepening partnership between CDC and Standard Chartered demonstrates the need to channel more trade finance towards vulnerable countries most affected by the impacts of the crisis, as well as support sectors that are critical to serving people’s basic needs.
“As we work to support global economic recovery from Covid-19, this additional US$100m through the CDC and Standard Chartered partnership will be critical for many businesses in sub-Saharan Africa and South Asia,” James Duddridge, FCDO Minister for Economic Development, said.
“This investment will help protect jobs, support economic growth and ensure vital goods get to those most in need.”
The new commitment further strengthens CDC’s long standing relationship with Standard Chartered, marking a key milestone in the partnership, and contributes to two of the United Nations’ Sustainable Development Goals: Zero Hunger (SDG 2) and Decent Work and Economic Growth (SDG 8).
Liked this article? Subscribe to DealStreet Africa News, our regular email newsletter with the latest news, deals and insights from Africa’s business, economy and more. SUBSCRIBE