Business
Benedict Oramah: Crusader of Africa’s economic integration
By EMEKA EJERE
On June 14, 2020, shareholders of African Export-Import Bank (Afreximbank), voted and re-appointed Prof. Benedict Oramah, as the president of the pan-African multilateral financial institution for a second five-year term.
The decision announced in Cairo following the bank’s 27th Annual General Meeting of shareholders which was held by circulation of resolutions due to the COVID-19 pandemic, will see Oramah pilot the affairs of the bank until the year 2025.
Headquartered in Cairo, the capital of Egypt, Afreximbank is the foremost pan-African multilateral financial institution devoted to financing and promoting intra and extra-African trade. The bank was established in October 1993 by African governments, African private and institutional investors, and non-African investors. Its two basic constitutive documents are the Establishment Agreement, which gives it the status of an international organization, and the Charter, which governs its corporate structure and operations.
Oramah, who took over the top job in 2915, has never hidden his passion for a common African market with unhindered entry and exit for African people and products. Little wonder in an acceptance statement released shortly thereafter, Prof Oramah told the shareholders that the bank’s ultimate goal under his second term would be the realisation of Africa’s strategic ambition to create an integrated market.
“We want an Africa where the foundations of the African Continental Free Trade Agreement (AfCFTA) are laid expeditiously so that the 84,000 kilometres of borders that have divided us for ages can begin to come down, Oramah said.
“The AfCFTA would drive the industrialisation of Africa, support the emergence of regional value chains, turn Africa’s creative and cultural assets into engines of growth, grow jobs for the continent’s youth, convey respect to Africans wherever they may be and better prepare the continent to compete more effectively in the global markets.”
The Nigeria-born technocrat highlighted that between 2015 and 2019, Afreximbank disbursed more than $30 billion in support of African trade with over $15 billion channeled towards the financing and promotion of intra-African trade.
“We will aim to double intra-African trade financing so that by the end of my term, it will constitute no less than 40% of the bank’s total assets, with aggregate disbursements, on a revolving basis, over the 5 years exceeding $30 billion,” he announced.”
In May, at the second edition of United Bank for Africa (UBA) Africa Day conversations held in Lagos, Oramah, who was one of the panelists, called for the swift implementation of AfCFTA agreement, saying, “The priority of government should be to make sure that the AfCFTA gets implemented without delay. If there was any doubt about the importance of that agreement, this pandemic has told us that this is the way to go.”
The Afrexim boss, who maintained that the pandemic has shown so many weaknesses of Africa across board, cautioned, “We know that hunger is looming if we do not do anything. If we allow hunger to take over from the COVID-19 pandemic, we will begin to see political problems and increase in insecurity, which will take a long time to overcome.
“For Africa the problems go beyond health challenges to other areas such as food supply. Hunger is looming and if action is not taken, Africa will see political problem. Africa has become the epicenter of the economic devastation that this pandemic has unleashed upon us.”
He disclosed that Afrexim had made available $200 million to supply fertilizers and grains amongst others across Africa. These and many more interventions would not have been possible for and international financial institution with a weak balance sheet.
According to its audited financial statement for the year ended 31 December 2019 Afrexim bank recorded strong and consistent growth, with total comprehensive income of $324.2 million. The results, which reflected a net income of $315.3 million, 14.3 per cent increase over the 2018 performance of $275.9 million, were achieved mainly due to higher operating income of $622.5 million compared to $489.8 million in 2018.
Afrexim bank’s total assets grew by 7.6 per cent from $13.42 billion on 31 December 2018 to $14.44 billion as at 31 December 2019, explained mainly by the solid growth in net loans and advances. The financial statements show a 29.7 per cent growth in gross income, which reached $1.1 billion in 2019 compared to $813.9 million 2018, putting the bank above the $1 billion mark for the first time.
Prof. Oramah expressed satisfaction with the results, noting that the performance exceeded strategic plan targets despite a global operating environment characterized by economic uncertainties. He noted that the bank had “continued to deliver the objectives of its current five-year strategic plan, dubbed IMPACT 2021, by prioritizing initiatives aimed at promoting and financing intra-African trade”.
Addressing concerns about imminent global recession as a result of COVID-19, Oramah said Afrexim bank was taking necessary steps to manage the impact, particularly on the loans and advances from customers that may be impacted, adding, “Afrexim bank is making arrangements to support its member countries in need”.
Since 1994, it has approved more than $67 billion in credit facilities for African businesses, including $7.2 billion in 2018. Afrexim bank had total assets of $13.4 billion as at 31 December 2018. It is rated A- (GCR), Baa1 (Moody’s), and BBB- (Fitch).
In recognition of his steadfastness in the pursuit of the mandates of the bank, the Jeune Afrique, the French language pan-African magazine, in 2019 named Prof Oramah as one of the most influential Africans, listing him at number 59 in the ranking of the 100 most influential Africans.
Justifying the inclusion of Oramah in the list Jeune Afrique cited his decisive role in driving economic integration in Africa, noting that, under his leadership, Afrexim bank had deployed a series of financial instruments, including letters of credit, commercial guarantees, loans among others in support of African economic integration.
According to Jeune Afrique, Afrexim Bank has also successfully attracted many new countries to join it as participating states and organized the first Intra-African Trade Fair in Cairo in 2018. It also noted the bank’s record results in 2017 when it attained a net profit of $220 million
The first three slots in the ranking went to Denis Mukwege, the Congolese doctor awarded the Nobel Prize for his work with victims of rape in the Democratic Republic of Congo; the Algerian people for successfully driving political change in their country; and Aliko Dangote, Africa’s leading business man.
