AfCFTA: Afreximbank President Oramah calls for African resources to support Africa’s development

In a recent interview with CNBC Africa, Afreximbank President, Benedict Oramah, emphasized the need for utilizing African resources to support Africa's development. The interview took place on the sidelines of the signing ceremony for a N300 billion medium-term note program with Nigeria's Securities and Exchange Commission (SEC) in Lagos. One of the key themes discussed during the interview was the importance of the Africa Continental Free Trade Area (AfCFTA) in driving economic growth and intra-African trade. Oramah highlighted the significance of the Pan-African Payment and Settlement System, which was launched to facilitate trade settlement in national currencies. Key Points: 1. Local Currency Program to Support AfCFTA: Oramah discussed the efforts to use the local currency program to bolster the AfCFTA, enabling the provision of a wide range of financial products. The initiative aligns with the goal of promoting trade within Africa and utilizing African resources for development. 2. Domestic Bond Issuance in Nigeria: Afreximbank's decision to issue its first-ever domestic bond in Nigeria was attributed to favorable market conditions, including lower interest rates and increased liquidity. The move aims to raise funds to support priorities, enhance financial stability, and foster innovation in the domestic capital markets. 3. Feasibility of AfCFTA Commencement: Oramah expressed optimism about the commencement of trading under the AfCFTA on July 1, 2020. He mentioned ongoing preparations, such as finalizing documentation with central banks and appointing a secretary for the agreement, to ensure a smooth start to trading activities. During the interview, Oramah outlined the specific goals tied to the bonds issued by Afreximbank, emphasizing the demand for domestic currency financing in Nigeria. He highlighted the importance of supporting trade-related activities and infrastructure development through local currency instruments. Quote: Reflecting on the impact of Afreximbank's interventions, Oramah stated, "The AFCFTA will change the paradigm. We will change the way we think. And when the African payment and settlement system that will debut in a few weeks, virtually gets entrenched, it will move markets. It will move things." He underscored the potential for African institutions to utilize African resources and shift towards self-reliance in debt management. The interview shed light on Afreximbank's commitment to promoting economic growth and infrastructure development in Africa, underscoring the transformative potential of leveraging African resources for sustainable development.