It’s a management truism that the quality of an organisation’s performance is inextricably linked to, and derives, from the quality of the people who work for it. On that basis, the staff of The African Export-Import Bank (Afreximbank) can take a well-deserved bow as the Bank enters the 30th year of its existence as perhaps the most successful public organisation in the continent’s history.
The Bank was established in 1993 with a straight-forward mandate to promote Africa’s internal and external trade at a time when the economies of the continent were in the doldrums and the future looked bleak.
30 years later, the Bank has assets worth over $30bn and its ever expanding list of activities is changing the destiny of the continent as we speak.
From the view expressed by various members of staff of the Bank in this report, perhaps the cardinal aspect separating the organisation from its peers was the culture of openness and discussion that was fostered by the first President, Christopher Edordu, and maintained and elaborated by succeeding leaders.
It was this culture of discussion, debate and learning that set the nascent Bank on a path that would lead to a string of successes. Given the myriad difficulties, obstacles, internally and externally induced problems and the sheer scale of the acute deficits of its operating environment – Africa – that the Bank and its staff faced, one can have little argument against the verdict of its previous President, Jean-Louis Ekra, who says that all things being equal “We have exceeded our expectations.”
This ability to solve a multitude of problems raises Afreximbank beyond its peers elsewhere in the world who have to deal with only a fraction of the issues that the Bank takes into its stride day by day. Rene Awambeng, head of client relations at the Bank, sums up what the Bank has evolved into neatly when he says: “We are not a typical lending business or a typical trade finance business; we are the entire trade solutions ecosystem.”
In fact, it is even more. Over the years, the Bank, says current President Benedict Oramah, has also become an important instrument for crisis response management in Africa. “Each time the continent experienced a crisis, the Bank expanded its operations to support its member countries.”
The crises have ranged from filling financing gaps for the continent’s exporters and importers, helping commodity-dependent countries mitigate counter-cyclical shocks, setting up a fund to purchase vaccines when the Covid pandemic hit the world and also softening the social and economic fallout from the pandemic through its specialised trade support facilities.
Along the way, it has also given teeth to the African Continental Free Trade Agreement; set up a sophisticated intra-African payment system that for the first time in Africa’s independent history bypasses expensive hard-currency intermediation; taken a cautious but determined step in Africa’s industrialisation strategy; changed long-encrusted traditions to break the stranglehold of foreign commodity processing value-addition; and set up various funds and initiatives to support African entrepreneurs and find markets for their products.
Not satisfied with this bewildering menu of activities, it also set out to “rejoin ancient African strands severed for 500 years by the Atlantic slave trade” when it followed up on a request from Caribbean counties to help in the purchase of Covid vaccines by taking an extra step and inviting these countries to join the Bank. It is part of its outreach to Africa’s sixth region – the diaspora.
This expansion has been part of the Bank’s long-held mandate to not only increase intra-African trade – a process that it holds as an article of faith if Africa is to move to the next level and evolve into an industrial force – but also forge greater South-South trade.
Interestingly, China was one of the few non-African members when the Bank was originally established in 1993. It intensified its interest in Africa through its own export-import bank established in 1994 and what followed was one of the greatest spurts of bilateral trade in human history as China has become the continent’s biggest trade partner and has contributed hugely to its infrastructure development. Relations were so strong that Afreximbank held its first AGM outside Africa in Beijing in 2012.
The Bank’s total assets grew from around $5bn when Prof. Oramah assumed leadership of Afreximbank in 2015 to $30bn in 2022. Net profit in Q1 this year alone has been a remarkable $170m. It aims to raise its assets to well over £50bn and has set its sights on doubling its disbursements to over $40bn over the next five years with a healthy portion of this going to supporting intra-African trade.
It is difficult to take in that this breakneck pace of achievements has come in only 30 years. What is even more impressive is that these great strides were made without once compromising the soundness of the Bank. As a self-regulating organisation, the onus of maintaining adequate liquidity has always fallen on its leadership and the leadership has always passed the test with flying colours.
A unique concept
While its mandate – to promote Africa’s internal and external trade and cover market failure – was straightforward enough, we should bear in mind that there was no roadmap to show the way nor for that matter, any examples to follow. No one else had even considered setting up a regional Exim bank.
The concept of the Afreximbank was an untried idea and it remained in gestation for years before the withdrawal of credit from international financial sources concentrated minds and made it imperative to establish a regional source of finance to maintain the pace of African external trade.
As part of my coverage of Africa in those days, I clearly remember how the idea was dismissed, including from some Africans, who predicted an early and inglorious end to what they called ‘the experiment’. That it did not follow the fate of many other financial institutions of the time and sink without a trace, is one of the most inspiring and dramatic stories of our times. How this happened, the nuts and bolts of the processes and paths taken or not taken, the dangers faced and survived, the near misses, the bold decisions, the poor choices as well as the brilliant ones, are detailed superbly by the Bank’s officers involved in the following pages of this report.
From an outsider’s perspective what struck the most strongly was the quality and determination of the people who ran the institution. When I met Jean-Louis Ekra, he was astonishingly open about what the Bank was trying to do and the odds for and against his strategy working or sinking. He made his moves like a chess grand-master and they paid off.
This culture of openness, continuous learning and discussion has continued apace creating fertile space for new ideas to germinate, take root and flourish. Innovation and finding solutions have become hard-wired into the Bank’s DNA.
Afreximbank has now also become the primary thought leader in the world when it comes to African development and its relationships with other economies and geographies. The Bank moved seamlessly from a low-profile trade finance agency to a major, high-rated multinational institution working on equal terms with the likes of the IFC and China Eximbank.
Ethos and values
Prof. Oramah, who had spent most of his professional life with the Bank, picked up the reins and, while sticking religiously to the driving mandate of the Bank, applied his own interpretation of the scale and scope. He, it appears to me, sees his role as solving any issue to do with trade and Africa, including competitiveness and value addition. In short, this opens up virtually any activity that impacts on African economies. But like his predecessors, he cuts and measures all his strategies to make sure that any expansion is covered and there is no danger of financial overreach. He has been both selective but also fortunate in the quality of his staff.
One can clearly discern the ethos and values inculcated by the Bank and its leadership in the reminiscences of its elite officers which you can read in this report. There is no doubt that all of them see their work not as a job but as a life-long vocation. Their horizon a fixed on the vision of a prosperous, healthy and happy Africa and they are working their way towards it, project by project, day by day. They are dreaming with their eyes open.
As Prof. Oramah says: “The Bank was a child of necessity, but today it is the driver of economic transformation.” This is not a wish – it is a statement of fact and it goes a long way to explain why Afreximbank is the most successful public organisation in the continent’s history. Roll on the next 30 years, and if the Bank has anything to do with, Africa will be different continent when that happens.