MIGA Strengthens Trade Finance for Key Economic Sectors in Côte d'Ivoire

Washington, January 29, 2024 – The Multilateral Investment Guarantee Agency of the World Bank (MIGA) has issued a guarantee to FirstRand Bank Limited of South Africa, acting through its Rand Merchant Bank Division, to cover a trade loan facility of up to €95 million. The bank will be protected against the risk of non-payment by the government of Côte d'Ivoire for one year. This is MIGA’s first trade finance guarantee against losses resulting from the failure of a sovereign to make payments related to trade finance transactions.

The short-term revolving loan facility is expected to enhance Côte d'Ivoire’s resilience in dealing with the lingering strains caused by the COVID-19 pandemic and the current global inflationary environment. The combined impact has created a need for short-term liquidity, working capital, and trade finance facilities to support the government’s critical developmental needs. With the MIGA-supported facility, Côte d'Ivoire will be able to continue executing its strategic plan to meet development goals in a challenging global setting.

“MIGA is pleased to help Côte d'Ivoire increase access to trade finance to support a continuation of critical imports while bolstering the country’s resilience in the face of global economic shocks,” said Hiroshi Matano, Executive Vice President of MIGA. “Our guarantee helps the country unlock new liquidity from an existing lender. It also contributes to maintaining a diversified lending base at a time when private sector players are retreating from core markets due to current economic conditions and capital considerations.”

As the world’s top exporter of cocoa and raw cashew nuts and a net exporter of oil, with a significant manufacturing sector, Côte d'Ivoire is the largest economy in the West African Economic and Monetary Union. Côte d'Ivoire’s five-year national development plan calls for the investment of $100 billion through 2025. The government intends to accelerate the structural transformation of the country’s economy and enhance access to education, drinking water, electricity, health care, social protection, and employment for its population. The government has also designated the development of the private sector as a top priority to transform it into a driver of the Ivorian economy.

With these national developmental goals in mind, the loan facility will be used to provide short-term loans to Côte d'Ivoire for trade-related payments to suppliers of critical imports in key sectors of the economy such as health care, infrastructure, and agriculture.

“While RMB has a proud history of supporting sovereigns on the continent with their funding and capital markets requirements, this is a first of its kind facility for an African sovereign and will pave the way for further MIGA guaranteed short-term facilities across the continent to assist with developmental initiatives, critical projects and the importation of crucial goods such as food, fertilizer and medicines alongside other resources,” said Ben Bechet from RMB’s Trade and Working Capital, Structured Solutions Team. “RMB’s strategy entails forging partnerships with insurance, guarantee and export credit agency providers to extend meaningful funding support to our clients across Africa. Collaboration with Development Financial Institutions and Multilaterals remains key to truly unlocking new opportunities to support our clients.”

About MIGA

MIGA was created in 1988 as a member of the World Bank to promote foreign direct investment in emerging economies by helping to mitigate the risks of restrictions on currency conversion and transfer, breach of contract by governments, expropriation, and war and civil disturbance; and offering credit enhancement to private investors and lenders. Since its creation, MIGA has issued over $76 billion in guarantees across 123 developing countries, supporting more than 1,000 projects. Over the past decade, MIGA’s guarantees have generated more than 156,000 jobs in developing countries.

About RMB

Rand Merchant Bank (RMB) is a leading African corporate and investment bank and part of the largest financial services group by market capitalisation in Africa, FirstRand Bank Limited (owned by FirstRand Limited). We offer our clients innovative, value-added advisory, funding, trading, corporate banking, and principal investing solutions.

With a presence in 10 African countries, we have a significant footprint on the continent. We also have access to a network of retail banks, representative offices and branches across Africa, the UK, India, and the US.

At RMB we are passionate about solving problems for our clients by asking the hard questions. We challenge accepted thinking. We analyse and seek solutions beyond the obvious. We are innovative in our thinking and turn challenges into opportunities, while delivering on Traditional values. Innovative ideas. Our ability to think differently, our collaborative spirit, our client-centric solutions, and our belief that great minds don’t always have to think alike, is what sets us apart. For more information please visit: www.rmb.co.za

Contact:

In Washington: 

Elizabeth Howton, (202) 458-5922, ehowton@worldbankgroup.org

For more information, please visit: https://www.miga.org  

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