BII, Citi Muster Support For African Smes With $100m.

United Kingdom’s development finance institution and impact investor, British International Investment, it has signed a $100million dollars risk-sharing facility with Citi to muster support for the trade finance needs of African small and medium enterprises and corporates.

The facility was disclosed during a signing ceremony in Washington at the World Bank’s Spring Meetings and is expected to provide a boost to businesses with high potential but limited by a lack of finance.

A statement from the impact investor said, the facility 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 increasingly support African businesses with imports of key commodities such as wheat, fertiliser, rice and sugar, stressing that, the BII is an investment partner to businesses in Africa, Asia, and the Caribbean that support the UK Government’s clean green initiative and create productive, sustainable, and inclusive economies in eligible markets.

The funding comes as local businesses struggle to secure key imports due to challenges precipitated by the COVID-19 pandemic and the Russia-Ukraine war, which have led to high inflation, rising interest rates and an increase in commodity prices, adding that, the trade finance gap in Africa has increased by approximately a third since the onset of the pandemic, climbing from $81billion dollars in 2019 to $120billion dollars in 2023.

The BII and Citi facility will help local businesses in underserved markets financing the import of economically productive goods, transport, essential equipment and machinery supporting the emergence of manufacturing industries in Benin, Cameroon, Côte d’Ivoire, Rwanda, Tanzania, as well as Uganda and Zambia.