Business / Companies
AfDB approves $25m credit line for CABS
26 Apr 2016 at 06:39hrs | Views
The African Development Bank has approved a $25 million trade finance line of credit facility to Central Africa Building Society of Zimbabwe. This medium term facility will support the expansion of CABS' operations as a provider of trade finance to local firms as well as small and medium sized enterprises within Zimbabwe's tradable sector.
"The Board of Directors of the African Development Bank approved a $25 million Trade Finance Line of Credit facility to Central Africa Building Society of Zimbabwe on April 20, 2016.
"This medium-term facility will help to support the expansion of CABS' operations as a provider of trade finance to local firms as well as Small and Medium-sized Enterprises within Zimbabwe's tradable sector," said AFDB in a statement.
The financial institution said the resultant credit support will provide for the importation of critical inputs such as agro chemicals, pesticides, farm machinery, spares and equipment, which Zimbabwe is in dire need of to revive its agricultural and manufacturing sectors.
AFDB said the credit support will also foster financial sector strengthening and generate more tax revenue through import duties and higher corporate profits.
Including roll overs, it is projected that the facility will finance approximately $150 million of trade over a three and half year period.
This facility contributes to scaling up of AfDB's interventions in supporting the economic turnaround necessary to re-position Zimbabwe as a major productive center in the Southern African region.
The Bank Group is currently engaged in a number of initiatives in the country and these include supporting the external debt and arrears clearance process.
In addition AFDB has been supporting Zimbabwe's infrastructure rehabilitation in the Energy and Water and Sanitation sectors through the Zimfund.
Under Zimfund, AFDB in December last year approved a $34million grant towards implementation of Bulawayo's Water and Sewerage Services Improvement Project.
The grant was aimed at ameliorating the health and social well-being of the people of Bulawayo which is the second most populous city and a major economic hub.
Other initiatives being rolled out by AFDB include improvements of governance through the Governance and Institutional Support Programme.
The finance group also indirectly supports the private sector through regional financial institutions that operate and invest in the country.
"This will be AfDB's first non-sovereign intervention in Zimbabwe's financial sector in recent years.
It is a strategic milestone expected to provide greater comfort to other international lenders to offer additional support," said AFDB.
"The Board of Directors of the African Development Bank approved a $25 million Trade Finance Line of Credit facility to Central Africa Building Society of Zimbabwe on April 20, 2016.
"This medium-term facility will help to support the expansion of CABS' operations as a provider of trade finance to local firms as well as Small and Medium-sized Enterprises within Zimbabwe's tradable sector," said AFDB in a statement.
The financial institution said the resultant credit support will provide for the importation of critical inputs such as agro chemicals, pesticides, farm machinery, spares and equipment, which Zimbabwe is in dire need of to revive its agricultural and manufacturing sectors.
AFDB said the credit support will also foster financial sector strengthening and generate more tax revenue through import duties and higher corporate profits.
Including roll overs, it is projected that the facility will finance approximately $150 million of trade over a three and half year period.
This facility contributes to scaling up of AfDB's interventions in supporting the economic turnaround necessary to re-position Zimbabwe as a major productive center in the Southern African region.
The Bank Group is currently engaged in a number of initiatives in the country and these include supporting the external debt and arrears clearance process.
In addition AFDB has been supporting Zimbabwe's infrastructure rehabilitation in the Energy and Water and Sanitation sectors through the Zimfund.
Under Zimfund, AFDB in December last year approved a $34million grant towards implementation of Bulawayo's Water and Sewerage Services Improvement Project.
The grant was aimed at ameliorating the health and social well-being of the people of Bulawayo which is the second most populous city and a major economic hub.
Other initiatives being rolled out by AFDB include improvements of governance through the Governance and Institutional Support Programme.
The finance group also indirectly supports the private sector through regional financial institutions that operate and invest in the country.
"This will be AfDB's first non-sovereign intervention in Zimbabwe's financial sector in recent years.
It is a strategic milestone expected to provide greater comfort to other international lenders to offer additional support," said AFDB.
Source - the herald
