Standard Bank receives funds to boost trade in Africa
Up to US$5 billion will be mobilised and disbursed through the Global Trade Liquidity Program (GTLP) to regional banks, who will use the financing to extend trade finance to importers and exporters in developing countries. The program is expected to support about US$50 billion in trade with developing countries.
The IFC signed a memorandum of understanding in London with Standard Bank, making it the first African financial institution to join the GTLP. Standard Bank will use the financing to expand funding for trade of consumer goods, intermediate goods, smaller machinery and commodities demanded by market enterprises in sub-Saharan Africa.
Says Jacko Maree, Standard Bank Group Chief Executive: “In a world where liquidity and funding are in short supply, a loan facility of this scale will go a long way towards stimulating economic growth and development. It is good for Africa and the region. Standard Bank will continue to lend in a responsible manner with due consideration of the existing financial and economic climate. We will not lose focus on our risk and corporate governance processes.”
Says Jean Philippe Prosper, IFC director for Eastern and Southern Africa: “Supporting the private sector by ensuring access to trade finance when it has become less available in the marketplace is an IFC priority under the Global Trade Liquidity Program. The program is an important part of IFC's response to the recent turmoil in global financial markets and will help address the decline in trade that threatens to set back decades of economic progress in Africa and in tackling poverty across the region."
In terms of the loan facility, all beneficiaries must be located in sub-Saharan Africa. However, cross-border deals between sub-Saharan Africa and other developing markets such as China, Russia and Brazil, also fall within the scope of the facility.
