IFC, a member of the World Bank Group, has signed an agreement with Zemen Bank, welcoming the Ethiopian financial institution as the newest member of its Global Trade Finance Program (GTFP).
The deal includes a $30 million trade finance facility guarantee aiming to strengthen Zemen Bank's trade financing operations and support Ethiopian businesses engaged in imports and exports.
Announcing the collaboration, Dereje Zebene, CEO of Zemen Bank, said the facility will play a key role in facilitating trade of essential goods and fostering new trading partnerships for Ethiopia.
“The program will significantly boost trade finance for numerous import-export enterprises, particularly during periods of global economic volatility,” he said.
Madalo Minofu, IFC Country Manager for Ethiopia, said increasing access to trade finance is critical to boost trade in Africa. The partnership with Zemen Bank through IFC's GTFP will contribute to strengthening Ethiopia's capacity for trade financing, according to her.
Under the Program, IFC issues guarantees to complement banks' ability to provide trade lines in new markets. In FY2023, IFC issued over nine billion dollars in guarantees globally, of which 3.5 billion dollars was in Africa.
The partnership is also part of IFC's one billion dollars Africa Trade and Supply Chain Finance Program to support regional trade development and reduce import reliance on the continent.
IFC will additionally provide advisory services to Zemen Bank to strengthen credit management and SME financing.
The deal aims to promote Ethiopia's private sector growth in key areas like agribusiness, manufacturing and financial services.
It demonstrates IFC's ongoing commitment to the country, where it has invested over $105 million in the past five years.
