Africa Trade Finance
We believe Africa is the new frontier of emerging market investors. It is home to ﬁve of the fastest growing economies in the world with fourteen economies that have a GDP exceeding 5%.
African trade has increased three fold over the past decade reaching USD 1.5 Trillion. This extraordinary growth is expected to continue at 10% annually.
African trade represents only 3% of the global trade at present. With minimal default rates, African trade is in line with the international default rates of less than 0.1%, despite higher costs of borrowing.
We believe the availability of funding and supply from international lenders does not meet the upsurge in demand tied to infrastructure projects across all sectors.
In our opinion this shortage of ﬁnancing continues to create a funding gap, which provides an opportunity for investments to beneﬁt from higher yields compared to other emerging economies.
We conclude this shortage provides an opportunity for partnership between traditional and non-traditional lenders.