AFRICOIN Programme Loan I

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The African Export-Import Bank (Afreximbank) is a regional development bank based in Cairo and receives a development loan with a guarantee framework from KfW. The funds are passed on by Afreximbank to selected processing companies in the African agricultural sector in the form of long-term loans to enable them to invest in capacity increases and production improvements in the cocoa sector, but also in other agricultural sectors such as cassava and shea. The depth of processing is low in many value chains in the African agricultural sector. A large proportion of exportable agricultural products leave the continent as unprocessed raw material and are processed into intermediate and finished products in the industrialized countries. The lack of access to long-term investment financing for SMEs is one of the main reasons for this in the African agricultural sector. The construction or expansion of facilities for processing raw products into intermediate products (e.g. cocoa butter, cassava chips, etc.) requires long-term investment capital, which is usually not made available by the local banking markets. Traditionally, the agribusiness sector has also been avoided by local banks due to perceived specific risks. The KfW loan to Afreximbank in the amount of USD 100 million has a term of seven years.