The Africa Export-Import Bank (Afreximbank) is establishing a regional base in the Caribbean in order to drive trade between the African continent and the region.

It will be based in Barbados and is set to open its doors on August 4.

Barbadian Prime Minister Mia Mottley made the announcement during a news conference on Thursday (June 29), describing the bank’s decision to choose Barbados as its headquarters as an honour.

According to her, “the Africa Exim Bank has chosen Barbados as its regional headquarters, and we are thrilled to be hosting them. We are currently working towards the opening ceremony, and they have already selected an office space and are making the necessary preparations to become fully functional.”

Mottley added that Afreximbank has allocated funding, amounting to US$1.5 billion, to finance public and private sector projects across the region. She is upbeat on the potential for significant technical assistance being passed onto Barbados from it being Afreximbank’s regional headquarters.

Major benefits to be derived

“One of the major benefits is the pilot scheme to facilitate our utilisation of the Pan-African Payments and Settlement System. This will have a profound impact on our ability to conduct trade and make transactions. It reduces the need for large amounts of hard currency and simplifies the process,” Prime Minister Mottley explained.

She noted that the payment system offered by Afreximbank would provide an underpinning and backstop, similar to their operations in Africa. This arrangement, Mottley said, would streamline trade by netting off transactions and minimising the need for extensive foreign currency exchanges.

She elaborated that, “in essence, we will be able to settle our debts by netting off trade balances and paying only the difference in hard currency. This will significantly reduce the absolute amount of US dollars required, making a tremendous difference for our region.”

She is hopeful that other CARICOM countries would join the initiative in the coming months, which would further amplify the financial support available.