British International Investment (BII), the UK’s development finance institution and impact investor, has entered into its first partnership with Deutsche Bank and announced a $150 million risk sharing programme. The programme will channel more capital and support a greater volume of trade flows into some of Africa’s most challenging and hardest to reach markets.
Trade financing in Africa remains severely constrained, with a gap estimated at $100 billion annually, according to African Export-Import Bank. Frontier markets are disproportionately affected as available liquidity tends to flow toward larger, lower-risk economies, leaving smaller and more vulnerable markets underserved.
Under a Master Risk Participation Agreement (MRPA), this partnership will help close the gap in these markets by providing ongoing, short-term, replenishing Trade Finance Financial Institutions (TFFI) capital capacity. Through Deutsche Bank’s extensive network of domestic financial institutions relationships across 42 countries, the programme will enable African businesses to import key commodities and productive goods such as machinery.
The programme will be primarily directed to Africa’s least developed countries, as defined by the UN, such as Zambia, Ethiopia and Rwanda.
The transaction demonstrates how development finance institutions and commercial banks can collaborate to support trade flows and promote financial inclusion in frontier economies.
Anand Jha, Global Head of Trade Finance, Financial Institutions at Deutsche Bank said: “This partnership enhances our risk sharing capacity and strengthens our ability to facilitate sustainable cross-border transactions across the wider African market. By combining our global platform with BII’s development mandate and regional expertise, we aim to unlock greater trade flows to the continent.”
Ndaba Mpofu, Managing Director and Head of Financial Services Debt and Trade Finance at BII said: “We are delighted to partner with Deutsche Bank in a joint mission to expand trade finance into African frontier markets where our investment can deliver development impact at scale. Strengthening trade finance is vital for facilitating the movement of essential goods and commodities in our markets and supporting sustainable growth. Expanding access will help build a more resilient ecosystem and unlock economic opportunities across Africa.”