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TDB agrees US$100mn trade finance facility with Export Trading Group

The Eastern and Southern African Trade and Development Bank (TDB) has provided a US$100mn trade finance facility to commodity trader Agri Commodities and Finance in a bid to support smallholder farmers.

The borrower is a wholly owned United Arab Emirates-based subsidiary of agricultural supply chain manager Export Trading Group (ETG).

According to TDB, the facility aims to combat supply chain disruption and rising inflation while helping to bridge the trade finance gap. It will target smallholder farmers in Africa by funding the import of fertilisers and seeds as well as the purchase of commodities like coffee, cocoa and cashew nuts from farmers in TDB member states.

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The loan “will facilitate intra and extra-regional trade flows, and boost forex revenues, to the benefit of member states’ balance of payments”, TDB says.

“Through our longstanding relationship, we are contributing to supporting food security in the region, building on sustainable and responsible practices, as well as sustaining income and market access for smallholder farmers,” says TDB chief executive Michael Awori, adding that over half of the labour force in Sub-Saharan Africa works in the agricultural sector.

Anish Jain, ETG’s chief treasury officer, says the loan “will help enhance agricultural value chains and livelihoods of approximately 285,000 smallholder farmers in the African region and work towards building a sustainable future”.

“ETG remains focused on uplifting farming communities by connecting smallholder farmers with international markets, expanding mechanisation and processing capabilities, and increasing knowledge around quality inputs, irrigation, post-harvest techniques and yield-enhancing practices,” Jain says.

Earlier this year, TDB also led a US$600mn deal with global commodity trader Trafigura to develop copper and cobalt mines in the Democratic Republic of the Congo and extended a US$10mn trade finance line of credit to NMB Bank to support corporate clients in export-focused sectors of Zimbabwe’s economy.

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