AfDB, BCP Sign $70 Million Agreement to Boost African Foreign Trade

Rabat – The African Development Bank (AfDB) has taken a significant step towards promoting foreign trade and blistering economic growth in Africa by approving a $70 million risk participation agreement with Morocco’s Banque Centrale Populaire (BCP). This landmark agreement marks the second collaboration between AfDB and BCP under the program titled “Risk Participation Agreement (50/50) for the benefit of the People’s Central Bank of Morocco.”

The move comes amidst a context of tightening regulatory standards for capital and compliance across the continent, leading to a reduction in international banks’ commitments and correspondent relationships in Africa.

One of the primary objectives of the agreement is to empower African banks and their small and medium-sized enterprise (SME) customers, ensuring they have access to essential trade finance instruments.

The direct beneficiaries will be African issuing banks whose trade finance activities have been constrained by inadequate trade confirmation lines provided by confirming international banks. Furthermore, local African SMEs and businesses, reliant on issuing banks to fulfill their trade finance commitments, will be indirect beneficiaries of this initiative.

Importantly, the agreement is expected to ensure stable access to finance for African commercial banks and SMEs engaged in foreign trade operations — a pivotal factor in driving economic growth and regional integration. This strategic move aligns with the AfDB’s commitment to supporting the realization of the African Continental Free Trade Area (AfCFTA) by unlocking the continent’s full growth potential and fostering new opportunities and jobs.

BCP, a Moroccan regional banking group, currently operates in 18 African countries through its network of banks known as “Banque Atlantique.” The group is actively involved in financing intra-African and international trade, making it an ideal partner for the AfDB in achieving the shared goal of boosting foreign trade development in Africa.

This agreement initiative paves away for increased trade opportunities, job creation, and economic stability across multiple African nations.