The Export and Import (EXIM) banks of Ghana and the United States have exchanged a cooperation framework agreement to finance local exports to the United States through the establishment of small-scale industries in each of Ghana’s administrative districts.
The deal forms part of efforts to empower Ghanaian private businesses and to promote industrial development. The framework agreement which has since taken effect was signed earlier this month by the Executive Vice President and Chief Operating Officer of EXIM Bank of the United States, Jeffrey Goettman, and CEO of EXIM Bank of Ghana, Lawrence Agyinsam.
According to the partners, the agreement is a statement of intent to cooperate in utilising U.S EXIM Bank’s medium-term loan guarantees to support financing by the EXIM of Ghana for on lending to qualified Ghanaian SMEs for their purchases of US goods and services.
The EXIM Bank of the United States has set a ceiling of $300 million that can be disbursed in transactions of up to $10 million under its medium-term guidelines.
Chairman and Acting President of US EXIM Bank, Jeffrey Gerrish, said the agreement on Friday, April 29 demonstrates his country’s commitment to collaborate with the EXIM Bank of Ghana to curb unemployment in Ghana.
“This cooperative framework agreement confirms [United States] EXIM’s commitment to President Trump’s Prosper Africa initiative and demonstrates our sincere interest in partnering with GEXIM [Ghana EXIM Bank] to create economic opportunities and jobs in both Ghana and United States.
“We anticipate that US] EXIM-backed financing will support the Ghanaian government’s initiative to create sustainable employment throughout Ghana and also will support American exporter and supply-chain jobs in multiple industries in the United States,” he said.
CEO of the EXIM Bank of Ghana, Lawrence Agyinsam, said he believes the framework agreement will position his outfit to effectively support private sector businesses by creating an enabling environment free from financing challenges to ensure growth.
He is optimistic the framework will ensure projects earmarked under the 1D1F receive the needed support. The agreement, he said, will also strategically empower the private sector to create jobs to curb unemployment.
“I’m extremely delighted about this cooperation framework under which [US] EXIM can provide up to $300 million in guarantees for GEXIM’s clients to source and procure machinery and equipment from the United States for their factories,” he stated.
According to Mr Agyinsam, “As the lead financing institution mandated to support government’s One-District, One-Factory program, GEXIM will be better positioned to empower and equip private-sector operators situated in each district to add value to their raw materials through processing and final export.”
About the EXIM-GEXIM cooperative framework agreement
Under the agreement, US EXIM and GEXIM will create an on-lending structure that allows GEXIM to serve as a borrower and the primary source of repayment for EXIM.
GEXIM will on-lend in transactions of up to $10 million to Ghanaians businesses as the end users of the financing, up to a total of $300 million as approved by US EXIM.
All transactions would be approved individually and are subject to EXIM’s policies.
The cooperative framework agreement exchange ceremony was attended by US representatives, Ambassador Stephanie S. Sullivan and Acting Vice President at the Industrial and Project Finance Division of EXIM.
Finance Minister, Ken Ofori-Atta and GEXIM CEO, Lawrence Agyinsam, were Ghana’s representatives.
