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On 12 July Proparco and the pan-African banking group Ecobank signed a USD 50 million trade finance guarantee package in Abidjan (Côte d’Ivoire). By guaranteeing documentary credits issued by four Ecobank subsidiaries in West Africa, Proparco is supporting international trade operations financed by the group and expanding its own range of financial instruments.

This guarantee will help to boost trade between African and European countries by enhancing the capacity of four of Ecobank’s African subsidiaries (in Burkina Faso, Côte d’Ivoire, Guinea (Conakry) and Mali) to finance import / export operations with EBI S.A., Ecobank’s French-based subsidiary.

A new type of finance to support a longstanding partnership 

The signing ceremony was held in Abidjan in the presence of Grégory CLEMENTE and Charles DABOIKO, CEOs of Proparco and Ecobank Côte d’Ivoire, respectively.

As Charles DABOIKO, CEO of Ecobank Côte d’Ivoire, explained, “this financing operation will enable the Group to expand its range of activities. It forms part of a long-standing and well-established partnership between Proparco and the Ecobank Group designed to support and grow the business of our leading pan-African banking group.

Grégory Clemente, Chief Executive Officer of Proparco added that “the deployment of a pilot trade finance loan forms part of Proparco’s objectives under its 2017-2020 strategy designed to meet customer requirements. We are delighted to conduct our first operation of this type with Ecobank, a longstanding partner and a pioneer in the African banking sector”.

Proparco’s major commitment to West Africa

This signature took place during Grégory CLEMENTE’s visit to Côte d’Ivoire and Senegal – the second such visit since he was appointed CEO in April 2016.
In the course of this trip, the Proparco delegation met with a number of key players from the Ivoirian private sector, notably from the agri-food, retail, real estate, construction and public works, and financial services sectors. Meetings were also organised with government bodies and with financial backers present in Abidjan.

Proparco has been active in Côte d’Ivoire since it was founded in 1977. Some of its more recent flagship operations in the country include projects in airport and energy infrastructure development (Abidjan International Airport, Azito and Ciprel thermal power stations), the cement sector (Limak), the agri-food sector (Sucrivoire, Palmci, Olam) and the banking sector.

Further reading

Ecobank Trade Finance

Proparco has signed its first Trade Finance operation with the pan-African banking group Ecobank, a longstanding partner. By guaranteeing documentary credits opened by four Ecobank subsidiaries in Burkina Faso, Côte d'Ivoire, Guinea Conakry and Mali, PROPARCO will facilitate the international trade operations financed by the group and is enhancing its range of financial instruments.
Trade Finance guarantee line with Ecobank to support the economies of West African LDCs
Burkina Faso Côte d'Ivoire Guinea Mali Multi-country Africa
Ecobank Côte d'Ivoire, Ecobank Mali, Ecobank Guinea Conakry, Ecobank Burkina Faso (issuing banks of the instruments eligible for the guarantee)

Ecobank Group is one of the main pan-African banking groups. The bank came about through the will of African businessmen to establish a bank that would support the economic growth of the continent and started its activities by opening a first subsidiary in Togo in March 1988. It subsequently developed in West Africa in the 1990s (opening of subsidiaries in Nigeria, Benin, Ghana and Burkina Faso).  
Ecobank is today an integrated regional commercial bank which employees over 19,500 people and has over 1,280 branches and offices in 39 countries in Africa, the Middle East, Asia and Europe.

The project involves guarantees given in the context of documentary credit operations. Ecobank will be the final beneficiary of the guarantee scheme: PROPARCO will guarantee four Ecobank subsidiaries in West African LDCs (Burkina Faso, Guinea Conakry, Côte d’Ivoire, Mali) in the context of the opening of documentary credits. These four subsidiaries are active in countries emerging from crisis (or still in crisis) and suffer constraints in the development of their activities to fund trade finance operations, as they experience difficulties in finding confirming banks for the documentary credits they issue.

This operation has a twofold interest: 
1- Positive impacts on the economies of the four countries concerned: 
- support for the growth of beneficiary countries and especially in the current macroeconomic and political context characterized by post-crisis situations (Côte d’Ivoire, Guinea Conakry) or security tensions (Mali and, to a lesser extent, Burkina Faso). The project should contribute to creating or maintaining employment. Over the next 5 years, over 1,860 jobs will be created or maintained, including 44% held by women. 
- increase in the resources available to issuing banks due to the reduction, allowed by a guarantee, of the level of collateral deposits they need to make with confirming banks.

2- A new product which complements PROPARCO’s range of products and meets its clients’ needs. These guarantee operations, which historically have low loss ratios, are often considered by the development finance institutions that propose them as a useful tool to establish a business relationship with new banking clients, a relationship which can subsequently be expanded with other types of longer-term financing.

Montant du financement en Euros
Guarantees given by Proparco to EBI S.A in the context of documentary credits issued by Ecobank Côte d'Ivoire, Ecobank Mali, Ecobank Guinea Conakry, Ecobank Burkina Faso and confirmed by EBI S.A. Maximum budget of USD 50,000,000 to be divided