The African Development Bank Group (AfDB) has approved a $175 million financial package for the United Bank of Africa (UBA), one of the largest banking groups in Africa. The package consists of a $150 million line of credit and a $25 million trade finance line of credit, which will support UBA’s operations in 20 African countries, where it provides banking services to over 18 million customers.
The African Development Bank (AfDB) has announced a $1.4 billion financing package for the development of industrial parks and special economic zones in Ethiopia. The package aligns with its High 5 priorities, especially “Industrialize Africa”, which aims to transform the continent’s economies through industrialization and value addition.
The package consists of two loans: a $1 billion sovereign-backed loan to the government of Ethiopia and a $400 million private sector loan to the Eastern and Southern Africa Trade and Development Bank (TDB). The loans will support the construction and operation of four industrial parks and two special economic zones, which are expected to create over 200,000 direct and indirect jobs, increase exports, and attract foreign direct investment.
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The industrial parks and special economic zones will also promote the development of local industries, especially in the textile, garment, leather, and agro-processing sectors. The AfDB said that the package is part of its strategy to support Ethiopia’s economic recovery and resilience in the aftermath of the COVID-19 pandemic. The package will also contribute to the implementation of the African Continental Free Trade Area (AfCFTA), which aims to create a single market for goods and services in Africa.
The financial package will help UBA to expand its lending capacity to small and medium enterprises (SMEs), as well as to key sectors such as agriculture, health, education, and infrastructure. It will also enable UBA to increase its trade finance activities, which are essential for facilitating regional integration and boosting intra-African trade.
The AfDB said that the package aligns with its High 5 priorities, especially “Industrialize Africa”, “Feed Africa”, and “Light up and Power Africa”. The package also supports the Bank’s Ten-Year Strategy and Financial Sector Development Policy and Strategy.
The AfDB’s Director of Financial Sector Development, Stefan Nalletamby, said: “We are delighted to support UBA’s growth strategy, which aims to consolidate its position as a leading pan-African financial institution and contribute to the economic and social development of the continent. This operation is aligned with the AfDB’s High 5 priorities, especially ‘Industrialize Africa’, ‘Feed Africa’, and ‘Integrate Africa’.”
By providing long-term funding in local and foreign currencies, we are helping UBA increase its outreach to SMEs and corporates, thereby contributing to job creation and income generation.
The UBA’s Group Managing Director and CEO, Kennedy Uzoka, expressed his appreciation for the AfDB’s support, saying: “This partnership reaffirms the strong relationship between the AfDB and UBA, and also underscores the bank’s commitment to Africa’s development. The financial package will enhance our capacity to serve our customers across Africa and beyond, while also supporting the AfDB’s vision of transforming Africa through trade.”
This facility will enable us to further diversify our funding sources, strengthen our balance sheet, and enhance our capacity to serve our customers across Africa and beyond. We remain committed to driving the economic development of Africa through innovation, customer-centricity, and best-in-class service delivery.”
The package will help SMEs and corporates by providing them with access to affordable and long-term financing, which is often scarce in many African countries. This will enable them to invest in their businesses, expand their operations, create more jobs, and increase their productivity and competitiveness. The package will also support UBA’s efforts to promote financial inclusion and digital banking solutions for its customers.