Africa Finance Corporation reached an agreement with Exim Bank China, for a $300 million loan. $200 million of that amount will be granted as a closed loan and $100 million as Precautionary Credit Line (PCL).  

The terms of the transaction have not been revealed but, according to Samala Zubairu (photo), president of AFC, the funds raised will help fund industrialization projects in Africa. This operation constitutes a pioneering experience for the financial institution which was used to Eurobonds and European syndicated loans.

The operation is equally important for Exim Bank China. It helps clear the idea according to which Chinese loans to Africa are only granted to states with poor transparency on the relevance of the projects those loans are used for.

AFC mainly owned by private investors, African banks mainly, was created to bridge the continent’s infrastructure deficit and strenthen its industrial capacities. It has already invested about $4.5 billion in 28 projects in the region.  

Idriss Linge