The Board of Directors of the African Development Bank Group (AfDB) has approved a three-year, $10.75 million trade finance facility for Intercontinental Investment Bank Djibouti (IIB Djibouti). This facility consists of three components: an $8 million Trade Finance Line of Credit, a $2 million Trade Finance Transaction Guarantee, and a $750,000 grant from the Affirmative Finance Action for Women in Africa (AFAWA), backed by the Women Entrepreneurs Finance Initiative (We-Fi).
The financing aims to bolster Djibouti’s economy by supporting the importation of critical equipment for sectors such as renewable energy, manufacturing, and telecommunications, as well as essential goods to meet local short-term demand. It will specifically benefit Micro, Small, and Medium Enterprises (MSMEs) and large local firms, including those owned or led by women. Preference will be given to projects with low vulnerability to climate risks and minimal greenhouse gas emissions.
According to Lamin Drammeh, Trade Finance Division Manager at AfDB, the Trade Finance Transaction Guarantee will enable the Bank to offer up to 100% guarantees to confirming banks. This will help facilitate the issuance of letters of credit and similar instruments by IIB Djibouti, increasing access to trade finance for Djiboutian SMEs. Additionally, the Line of Credit will provide vital liquidity to strengthen IIB Djibouti’s trade finance operations.
Papa Demba Diop, CEO of IIB Djibouti, highlighted that the facility goes beyond financial support—it represents the start of a long-term strategic partnership with AfDB. Given that over 70% of employment in Djibouti is generated by SMEs, yet access to trade finance remains limited, this initiative is positioned to empower local entrepreneurs, particularly women, promote industrial growth, and enhance the resilience of Djibouti’s economy.
Related Posts
