The United Kingdom’s development finance arm, British International Investment, has teamed up with Deutsche Bank to introduce a $150 million trade finance programme aimed at unlocking funding for businesses in Africa’s most underserved markets.
Structured as a risk-sharing facility, this marks the first joint initiative between BII and the German lender. The programme is designed to assist importers and exporters in frontier economies, where global banks often limit trade finance due to perceived high risks.
According to the African Export-Import Bank, Africa faces an annual trade finance shortfall of around $100 billion, with smaller and less developed nations most affected by tight liquidity. The new initiative aims to bridge this gap by enabling local financial institutions to provide more short-term credit for cross-border trade.
Through a Master Risk Participation Agreement, BII will share exposure on trade finance deals initiated by Deutsche Bank. This arrangement allows capital to be efficiently reused, increasing the total financing available to businesses over time.
The facility will concentrate on the least developed nations as classified by the United Nations, including Zambia, Ethiopia, and Rwanda. It is expected to facilitate the import of critical goods, such as machinery and other production inputs, while also reinforcing regional supply chains.
Anand Jha, Deutsche Bank’s global head of trade finance for financial institutions, stated that the collaboration would “expand our risk-sharing capacity” and enhance the bank’s ability to process cross-border transactions throughout Africa.
Ndaba Mpofu, BII’s head of financial services debt and trade finance, highlighted the developmental significance, noting that improving access to trade finance is vital to “support sustainable growth” and strengthen economic resilience across the continent.
This deal reflects a growing trend of partnerships between development finance institutions and commercial banks aimed at de-risking investments in emerging markets. By combining public and private capital, such collaborations seek to attract funding to areas often ignored by conventional lenders.
Analysts suggest that if successful, the programme could serve as a blueprint for scaling trade finance solutions across Africa’s frontier economies.