The expansion of African countries’ involvement in international trade and global value chains holds the promise of triggering a profound ripple effect, transforming economies, and alleviating poverty across the continent.
But our prosperity isn’t solely reliant on international value chains. In West Africa, our rapid population growth, rising incomes, and a burgeoning middle class makes us a dynamic consumer market. Our region is home to a wealth of natural resources, from fertile agricultural land to abundant mineral deposits and a diverse range of industries, from manufacturing and technology to creative arts and tourism.
Now is the time to harness this potential and unleash the power of intra-African trade. By strengthening our economic ties and exchanging goods and services within our own region, we can create jobs, boost economic growth, and improve the lives of millions of people.
Enhancing intra-African trade presents a multitude of benefits for our region. By reducing our reliance on external markets, we fortify our resilience against global economic upheavals. It fosters the evolution of regional value chains, catalyzing heightened productivity and innovation. This, in turn, fuels economic growth, and bolsters regional integration, nurturing a shared sense of unity and cooperation.
The African Continental Free Trade Agreement (AfCFTA), operational since January 2021, offers a glimpse into the potential transformational impact of a single continental market. The United Nations Economic Commission for Africa estimates that the AfCFTA could raise intra-Africa trade to as much as $50bn to $70bn by 2040 while the World Bank predicts that it could increase real income as much as 9% by 2035, lifting 50 million people out of extreme poverty.
This is where Access Bank emerges as a pivotal player having grown from a small presence in Nigeria to becoming Africa’s largest banks by customer numbers. The Bank has been on a journey, to strategically establish presence across Africa, expanding to high-potential markets and leveraging the benefits of the (AfCFTA). In West Africa alone, outside of Nigeria, we have expanded into five other countries and the latest acquisition of Standard Chartered Bank’s shareholding in Cameroon, The Gambia and Sierra Leone will further enhance the bank’s presence in the region.
We are establishing a strong presence in all the major trade centers on the continent, enabling us to make our trade finance expertise available to West African multinational corporations as well as small and medium-sized enterprises (SMEs). As we consolidate our Wholesale business, supporting intra-African trade across the continent, our international subsidiaries will continue to play a critical role in anchoring trade across key global markets
It would, however, be remiss of me not to highlight that, to fully realize the potential of intra-African trade, we must address the challenges that hinder its growth. These include inadequate infrastructure, such as roads, railways, and ports, which makes transportation of goods costly and inefficient; non-tariff barriers, such as complex customs procedures and regulatory hurdles which discourage trade; and limited access to finance, particularly for SMEs, which while being the backbone of our economies, face an annual trade finance gap of approximately $81 billion.
Overcoming these challenges requires concerted action at both private and public sectors. While governments must invest in infrastructure development, streamline trade procedures, and harmonise regional regulations to facilitating cross-border trade, and promote regional value chains, the private sector also has a key role to play in driving intra-African trade.
As African businesses continue to expand their reach across the continent, the role of trade finance is expected to grow even more significant. By providing the right funding at fair costs, trade finance empowers businesses to optimize their bottom line, contributing to the sustainable development of Africa’s burgeoning economies.
The benefits of trade finance extend beyond access to capital. Access Bank’s trade finance solutions also help businesses manage payment and supply risks, ensuring seamless transactions and protecting against potential disruptions. This reduces the burden on businesses and allows them to focus on their core operations.
As we move forward, it is essential to foster a spirit of regional cooperation and collaboration. We must recognize that our destinies are intertwined, and that our success is linked to the success of our neighbors. By working together, we can create a prosperous and interconnected West Africa, where trade serves as a catalyst for economic growth, social development, and shared prosperity.
Access Bank stands ready to support the region in seizing this opportunity and building a future where West Africa stands tall, not just as a region of immense potential, but as a region that has harnessed its strengths to create a brighter future for all its citizens.