SACE’s Africa Programme provides R3-billion in new guarantees

Export credit agency SACE provided guarantees in 2008 of €281-million (R3.24-billion) in Africa in a total of 21 transactions. The countries mainly covered included Angola, Ethiopia, Gabon, Mauritius, Nigeria, South Africa and Tanzania.

The Africa Programme, an initiative launched by SACE in 2006, is aimed at providing greater support for companies investing or exporting in the Africa region through the implementation of more flexible terms of cover.

SACE recently reassessed its cover policy towards this region, adopting a more open approach. In 2006, a new Africa Programme was launched to assist Italian enterprises in the African markets considering the growth of the region.

Following years of political instability, most sub-Saharan countries went through a broad restructuring process, supported by the IMF/World Bank debt-relief initiative. Structural reforms helped create a more favourable operating environment. Now some of these countries are experiencing sustainable growth.

SACE’s cover policy is related to the country’s political and economic environment, including progress made in terms of the HIPC initiative. Its support is focused on priority projects and responsible lending.

SACE’s 2008 commitments in the continent increased by 40% compared to 2007. The most notable transactions of the year came in the oil & gas, power and transportation sectors in Angola, South Africa and Tanzania.
Since the launch of the Africa Programme in 2006, €741-million (R8.56-billion) in new commitments have been guaranteed by SACE in Africa.

Year-on-Year Comparisons
Full Year 2008: percentage of Sub-Saharan Africa over total SACE new guarantees and number of transactions approved

New guarantees in Sub-Saharan Africa (€ million)

Other activities
Some of the activities undertaken by SACE in the region during 2008 are listed below:

* Opening of the Representative Office in Johannesburg on 17 June 2008;
* Launching of the partnership with Standard Chartered Bank for risk sharing on transactions in Sub-Saharan Africa;
* Launching of a technical and financial partnership with African Trade Insurance - ATI;
* Established contacts with MLAs, DFIs and commercial banks for risk sharing on transactions in the region:

i. MLAs: Afrikexim, IFC, EIB, AfDB and ADF;
ii. DFIs: DEG, FMO, PROPARCO;
iii. Commercial banks: Standard Bank, Nedbank, First National Bank, ABSA – Barclays, ABN Amro, Citigroup, Deutsche Bank, Fortis, Millennium BIM, Unicredit, ING, Zenith Bank.

Note: The exchange rate calculation was done at €1 = R11.547