African Import-Export Bank (AfreximBank) will likely get Egypt on board its new transit guarantee scheme that is set for reducing trade costs, said Kanayo Awani, the bank’s managing director for intra-African on March 17.
Afreximbank launched the scheme that is worth $1bn (EGP 15.68 billion) across the African continent. This was brought with a pilot $200 million (EGP 3.13 billion) agreement covering the Common Market for Eastern and Southern Africa (COMESA), which was signed on March 10.
The scheme will ensure that when goods do not complete their transit, duties and taxes that would have been required are still paid.
Afreximbank will provide transit bonds that cover the borders where goods are required to cross. The bank will work with the existing operators to increase their capacity to issue local bonds.
The bank aims to issue the first transit bonds during the third quarter of 2021.
Egypt, which is working with nine other countries with the aim of to completing a highway from Cairo to Cape Town by 2024, has “shown a lot of interest,” Awani commented, adding, “We are hopeful that Egypt will join soon.”
Last September, Kenya removed the customs duty imposed on Egyptian exports, as it would adhere to the COMESA trade agreement until June 30
