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An oil well silhouette. South Sudan has in March realised a record USD 27.62 million in commercial risk insurance cover.[Photo/Bigstock]

South Sudan has in March realised a record USD 27.62 million in commercial risk insurance cover.

Through the efforts of the South Sudan government, the African Development Bank and the Africa Trade Insurance Agency (ATI), to date ATI has provided gross risk cover to facilitate investments in the electricity, gas, water supply and financial and insurance sectors.

South Sudan[1] is also expected to benefit from a USD 100 million trade facility from the Trade and Development Bank (TDB).

Rural clinics and police stations

The facility will focus on strategic commodities, budgetary support and other essential co-imports.

It will comprise USD 60 million in hard currency and USD 40 million for spare parts, food[2], pharmaceuticals and refined products.

About USD 5 million has been ring-fenced for solar energy at rural clinics and police stations.

South Sudan’s membership of the ATI and the TDB was made possible by a USD 18.15 million concessionary facility from the African Development Bank.

Economic fragility in South Sudan

The African Development Bank’s country manager for South Sudan, Benedict Kanu, said, “With a very weak capitalisation of private trade finance and insurance institutions in South Sudan, there is a pressing need to boost trade finance.”

He added that the ground-breaking AfDB-supported project demonstrates an innovative use of limited concessionary financing, with exemplary catalytic effects in the immediate and long-term.

“Once scaled up, the project will address some of the over-arching factors contributing to economic fragility in South Sudan, particularly financial sector development and risk management,” he added.

Membership of the East Africa Community

Kanu added that the immediate and future benefits of South Sudan’s ATI and TDB membership project recall the country’s aspirations of members of the East Africa Community (EAC) which was realised in April 2016.

“They also reinforce the Bank’s High 5 Agenda for Africa’s economic transformation,” he said.

The Bank’s Head of Trade Finance, Yaw Adu Kuffour, said the shortage of trade finance in Africa presents clear risks to the economic performance of regional member countries, especially those in transition.

He added, “We are glad to support South Sudan in this way.”

Stakeholder engagement

AfDB will work closely with ATI, the government, the private sector and other concerned stakeholders to promote inclusivity and communication and information dissemination at the country level, especially on ATI’s services, products and investment guarantee tools.

In collaboration with ATI and TDB, the Bank will also organise a stakeholder engagement event in Juba at a date to be determined.

You can also read about AfDB’s Uhuru Fund targeting West Africa champions,why Africa will have better negotiated trade deals and thegolden opportunities at bridge connecting 8 African countries.[3][4][5]

References

  1. ^ South Sudan (www.exchange.co.tz)
  2. ^ food (www.exchange.co.tz)
  3. ^ AfDB’s Uhuru Fund targeting West Africa champions, (www.exchange.co.tz)
  4. ^ why Africa will have better negotiated trade deals (www.exchange.co.tz)
  5. ^ golden opportunities at bridge connecting 8 African countries. (www.exchange.co.tz)

Source http://www.bing.com/news/apiclick.aspx?ref=FexRss&aid=&tid=DEAD691429CA4D80A398786034ED3B73&url=https%3A%2F%2Fwww.exchange.co.tz%2Fsouth-sudan-commercial-risk-insurance-cover-financial-sector%2F&c=281892931129440287&mkt=en-ca