General Meeting of the African Export-Import Bank

Address by
K. Y. Amoako, UN Under-Secretary General and Executive Secretary, ECA
9 May 1996
Addis Ababa, Ethiopia

Mr. Chairman,

Honourable Ministers,

The President of the African Export-Import Bank, Mr. C. C. Edordu,

Ladies and Gentlemen,

It is an honour for me to welcome you to the Headquarters of the Economic Commission for Africa. The General Meeting of the Board of Governors of the African Export-Import Bank is taking place against significant developments in the world economy, including its rapid globalization. Elsewhere in the world, larger economic and financial blocs are being created or reinforced. The post Uruguay Round trading environment offers opportunities for those countries that are able to take advantage of a liberalized global trading environment. For Africa, this poses formidable challenges as well as opportunities.

Africa has not been a beneficiary from the expansion of international trade over the last two decades. On the contrary, the continent's share of world trade has shrunk. It has had to endure the ravages of declining terms of trade, with its economic and social implications. Africa will need to work harder than ever if the continent is to become an effective partner in the world economy. In this, the African ExIm Bank has indeed an important role to play.

The Economic Commission for Africa strongly supported the establishment of the African ExIm Bank when the idea was mooted in the late 1980s, and we are happy to see that it is emerging among the leading regional financial institutions in Africa.

Considering the profound impact that globalization will have on the way trade is conducted and financed, trade financing in Africa has to be viewed in two dimensions: in terms of enhancing Africa's trade with the rest of the world; and increasing trade among African countries, which is now running at a meager 5 per cent of Africa's total trade.

The links between trade, economic growth and development are now fully recognized. Outward and market-oriented development strategies are being accepted by many African countries as a precondition for sustainable development. Expansion in trade leads to improved resource allocation and optimal use of a country's comparative advantage. An export-led strategy, to be successful, needs more than trade financing. But a lack of such financing can be a serious impediment to the development of the trade sector.

We at the ECA recognize that much needs to be done to enhance the capacity of Africa to be effectively integrated into the globalizing and liberalizing world economy, to reap its benefits. We recognize that improvements in trade financing have to be complemented by improved trade-related facilities.

Accordingly, the ECA intends to devote time to helping African countries to develop trade-related services. Governments ought to recognize that in order to help expand trade and trade related financing, they have to facilitate the setting up of private sector service providers. It is crucial that the private sector is enabled and encouraged to play its proper role as the engine of economic growth in Africa.

Trade is efficient when business information is timely and affordable. Firms remain competitive when they can stay well informed about market opportunities. Increased marketing is also a key to improved competitiveness for Africa's exports.

The United Nations has recognized that improved guidelines in customs, banking, insurance and telecommunications will encourage more efficient trade and reduce transaction costs. In 1992, UNCTAD 8 launched the Trade Point Programme, which aimed to establish a set of Trade Points across different regions of the world. The Trade Point combines three services: a trade facilitation center, where participants in foreign trade can be grouped under one roof; a trade information source, providing data about opportunities, suppliers and regulations; and a gateway to global networking.

The establishment of subregional and regional Trade Point Development Centres will be carried out in cooperation with all UN Regional Commissions, including the ECA. We look forward to working with strategic partners in this important endeavour, including the Africa ExIm Bank.

As you may know, we at the ECA are currently undergoing a process of change and renewal, with a view to Serving Africa Better. We recognize that the future of Africa depends on its ability to adapt to the rapidly changing international economic environment. We are trying to position ourselves to help the continent to make it across the bridge. We intend to develop strong cooperative arrangements with our strategic partners in this mission and we look forward to a fruitful alliance with the African ExIm Bank in areas where we believe the ECA can help.

I wish you every success in your deliberations.

I thank you.