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Afreximbank bankrolls Beitbridge rehab

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BY FIDELITY MHLANGA THE African Export-Import Bank (Afreximbank) has approved a US$70 million facility to bankroll the expansion and upgrade of Beitbridge Border Post as efforts to eliminate gridlocks to trade at Sadc’s busiest port. Afreximbank said it had authorised a US$43 million senior-term loan facility to Zimborders Mauritius (Pvt) Ltd and issued an investment […]

BY FIDELITY MHLANGA

THE African Export-Import Bank (Afreximbank) has approved a US$70 million facility to bankroll the expansion and upgrade of Beitbridge Border Post as efforts to eliminate gridlocks to trade at Sadc’s busiest port.

Afreximbank said it had authorised a US$43 million senior-term loan facility to Zimborders Mauritius (Pvt) Ltd and issued an investment guarantee of US$27 million to support the Pembani Remgro Infrastructure Fund as part of the project.

Zimborders is a Mauritius-based consortium with entrepreneurs from Zimbabwe and South Africa, in addition to international financial institutions and experts.

“The financing facility forms part of a US$204,4 million syndicated senior-term loan facility for which Afreximbank was among a consortium of financial institutions acting as mandated lead arrangers and senior debt lenders,” Afreximbank said.

President Emmerson Mnangagwa in July 2018 presided over a ground-breaking ceremony of the project, which is vital for reducing the time cross-border truckers spend awaiting clearance before proceeding.

Multiple African financial institutions have made a commitment to fund the facility which is vital for boosting trade between southern Africa and the rest of the continent.

In addition to Afreximbank, southern African financial institutions — FirstRand Bank Limited, ABSA Limited, Nedbank Limited, Standard Bank of South Africa as well as the Emerging Africa Infrastructure Fund are taking part.

“It is too costly to wait for almost five days at the border to deliver goods and services across southern Africa,” Afreximbank president Benedict Oramah said.

“With this facility, we aim to cut indirect and direct costs of trade associated with border post effectiveness and efficiency,” Oramah said.

He said the project would involve the procurement of technical equipment and software to modernise the border post.

Investments have also been lined up for Beitbridge town, which would benefit from the construction of a fire station, residential units, sewer facilities, power lines, a reservoir and a water pump station.

The funding comes at a time the African Continental Free Trade Area (AfCFTA) came into effect in January, with borders like Beitbridge expected to play a central role in regional business as intra-Africa trade grows.

In southern Africa, governments appear to have already  responded to the projected rise in trade with the establishment of projects like the multi-million-dollar Kazungula Bridge, which links Botswana, Zimbabwe and Zambia and significantly reduce distances travelled by transport networks.

AfCFTA will cut across Africa’s 55 economies with a combined 1,3 billion consumers and US$3,2 trillion gross domestic product.

The AfCFTA agreement contains provisions compelling member States to remove tariffs on 90% of goods entering their markets from the region.

“The country should participate meaningfully in the regional and international economy and take advantage of AfCFTA and TFTA (Tripartite Free Trade Area)”, the Confederation of Zimbabwe Industries (CZI) said last year.

“Opportunities for synergies with all neighbouring countries to establish one-stop border posts and enhance efficiencies and collaboration need to be executed to improve flow of trade,” said the CZI.

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