By Emmanuel AKOMEA
The Alliance of African Multilateral Financial Institutions (AAMFI) has jointly dedicated a US$62 billion fund to address the continent’s critical trade and investment gaps.
The Alliance aims to collaborate to address Africa’s development finance needs, promote the interests of member states, advocate for Africa on global finance issues, develop innovative finance tools, support sustainable finance strategies, and coordinate debt management negotiations.
The membership of AAMFI includes Africa Finance Corporation (AFC), African Export-Import Bank (Afreximbank), Trade and Development Bank Group (TDB Group), African Reinsurance Corporation (Africa Re), African Trade and Investment Development Insurance (ATIDI), Shelter Afrique Development Bank (SHAFDB), ZEP-RE (PTA Reinsurance Co.), African Solidarity Fund (ASF) and East African Development Bank (EADB).
AAMFI or the Africa Club, as also called was launched in collaboration with the African Union Commission, by African Heads of state, on the margins of the 37th Ordinary Session of the Assembly of the Heads of State and Government of the African Union on the 17th of February 2024 in Addis Ababa.
Chairperson of the AAMFI Governing Council and President and Chair of the Board of Afreximbank, Prof Benedict Oramah, said the Alliance is a coming together of African Multilateral Financial Institutions, set up by treaty, by African states in response to the inadequacies of the global and continental financial architecture.
“The Alliance’s formation underscores Africa’s commitment to self-reliance and sustainable economic development, leveraging home-grown solutions and resources for the continent’s advancement. It is a critical initiative that will be transformative for the continent, ensuring the effective mobilization of our domestic and international resources towards the continent’s development,” he stated.
Speaking at a press briefing in Accra on the margins of the 6th mid-year coordination meeting of the African Union (AU), he emphasised the importance of enhancing domestic resource mobilization within Africa, stating that a vibrant African capital market is essential for attracting investments, promoting economic growth, and creating opportunities for local businesses and entrepreneurs.
The Commissioner for Economic Development, Trade, Tourism, Industry and Minerals, African Union Commission, Albert Muchanga, said the continent’s sustainable and accelerated development required a broadened collaboration, highlighting the significance of collaborating with institutions such as the African Credit Rating Agency.
He mentioned that AAMFI should provide evidence-based proposals to the African Union on reforming the global financial architecture. This move aims to ensure better representation of developing countries in international financial decision-making processes.
Again, he said the AAMFI must develop proposals for debt restructuring arrangements in Africa. The proposals seek to ensure comparable treatment and collective burden sharing, addressing the challenges posed by debt obligations in the region.
Africa Rating Agency
According to H.E Muchanga, the goal to operationalize the African credit rating agency was previously decided upon. He indicated they are currently working with the African Peer Review Mechanism and African development bank to develop a plan for operationalizing the agency.
The rating agency will provide second opinions on existing credit ratings from external sources, as well as undertake credit ratings of borrowers within Africa to help develop an African capital market.
The agency will also work on capacity building across Africa to help countries and organizations understand credit ratings and related aspects.
Chief Executive Officer of Shelter Afrique, Thierno-Habib Hann, also indicated that executing initiatives and providing financial support to businesses could alleviate poverty in Africa and generate wealth for its population.
He also highlighted that the Alliance would function as a gateway for international multilateral financial institutions to collectively address trade and investment obstacles in the continent.
A group photograph of AAMFI member institutions representatives with Prof Benedict Oramah, the Chairperson of the AAMFI Governing Council.
