AfDB and the African Trade Insurance Company Sign USD 1 Million Technical Assistance Grant
Kenya Resident Representative, Domina Buzingo, and the Acting Chief Executive Officer of the African Trade Insurance Company (ATI), Stewart Kinloch, have signed a grant of USD 1 million from the Fund for African Private Sector Assistance (FAPA).
FAPA is sponsored by Japanese government and the event was attended by the Japanese Ambassador to Kenya, Shigeo Iwatani. The technical assistance contribution from FAPA, which makes up 31% of the overall technical assistance package for ATI, will be used to co-finance the provision of technical assistance to ATI to build the institution’s capacity, which is the only institution in Africa that offers political risk insurance and whole trade credit insurance.
The specific objectives of the FAPA technical assistance include helping to improve the ATI’s internal capacity to deliver on its mandate and build the capacity of current and future member states on the use of risk mitigating instruments in trade and investment. In the former, the proposed technical assistance activities include:
- Strengthening corporate governance;
- Implementing an underwriting system;
- Strengthening communication technology infrastructure;
- Enhancing human resources management skills;
- Improving ATI’s ability to meet customer needs in existing member states;
- Developing a marketing strategy; and
- Carrying out a survey on the trade market in the region to assess the impact of the recession and the need for alternative products.
The AfDB holds an equity investment of USD 10 million to ATI in concert with a number of other development finance institutions who are also contributing to co-financing the technical assistance package supported by the FAPA grant. In addition, the ADF will provide up to USD 50 million in loans and grants to its regional member countries to make initial investments in ATI.
The Fund for African Private Sector Assistance (FAPA) is a component of the Enhanced Private Sector Assistance Initiative (EPSA), a billion-dollar, AfDB-Japan joint initiative designed to promote private sector development in Africa.
The FAPA trust fund provides untied grants for studies, technical assistance and capacity building for private sector projects and African institutions such as ABT. Since FAPA's creation in 2006, Japan has contributed USD 30 million while the AfDB has contributed USD 10 million. To date, FAPA commitments stand at USD 26 million for 32 projects across the continent.