The African Export-Import Bank (AFREXIMBANK) has signed a Memorandum of Understanding (MoU) with the World Trade Organization (WTO) to amplify the impact of their strategically aligned joint efforts to promote global trade, leveraging Africa’s unique resource endowment.
An AFREXIMBANK statement said the MoU would also allow the two organizations to pursue a collaborative framework for harmonizing and coordinating their efforts toward deepening key trade development activities in Africa.
AFREXIMBANK and the WTO are part of an inter-agency partnership championing transformative change in the cotton industry in Africa’s Cotton-4 plus (C4+) countries, which include Benin, Burkina Faso, Chad and Mali as well as Côte d’Ivoire as an observer.
The MOU would afford the Bank and the WTO Secretariat opportunity to expand and deepen their collaboration to support the cotton sector beyond the C4+ countries.
Details of the MoU showed that their support would entail the development of local and regional value chains of cotton in Africa as well as their integration into the global value chain.
Another area of collaboration under the understanding would be on Trade Finance matters, addressing non-tariff barriers to trade, the digital economy, capacity building, the oceans’ economic and fisheries subsidies, the sports and creative economies and trading in the context of the African Continental Free Trade Agreement (AfCFTA).
President/Chairman of the Board of Directors of AFREXIMBANK, Prof. Benedict Oramah, described the WTO Secretariat as a natural partner to the Bank given the shared mandate of the organizations towards promoting trade and trade-related activities.
“We are already working with the Secretariat on FIFA’s C4+ Cotton Initiative, for which we have committed financing for project preparation for cotton transformation projects in Africa. Formalizing our relationship today signifies that we can go beyond our present collaboration to include other equally impactful interventions across key economic sectors in Africa,” he said.
Oramah disclosed that the Bank recently signed a Charter with Confédération Africaine de Football (CAF) and the Rebranding Africa Forum (RAF) to build a robust sports’ economy, which would include commercializing and monetizing African made sports apparel and athleisure wear, describing it as another undertaking that would benefit from the MOU with the WTO Secretariat.
Director General of the WTO Secretariat, Dr. Ngozi Okonjo-Iweala, said the signing of the MOU was timely, as it reflected some of the key priorities of many of the WTO Member countries.
“I am particularly pleased to see that it will support Members’ efforts in Agriculture and Food Security, advance efforts to address harmful fisheries subsidies, and promote cooperation on Trade Finance. I am especially pleased that AFREXIMBANK has committed to explore the opening of a finance window that would assist the C-4 plus countries on their journey to scale value addition on the continent. I look forward to seeing real, on-the-ground results from this partnership,” she said.
The C4+ countries have historically exported raw cotton for processing outside of the continent. Developing local industries to process and transform cotton into textile, could potentially create 500,000 jobs in the West African region. If harnessed well, it is expected that within the next 10 years, the C4+ countries could process up to 25% of their cotton crops. This undertaking requires circa $5 billion in investment in production facilities and training for workers. Which in turn calls for capacity building, access to finance for businesses, and improved infrastructure.
