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Afreximbank Announces $120M Facility for Djibouti’s Port and Free Zone Authority

Afreximbank Announces $120M Facility for Djibut’s Port and Free Zone Authority

The African Export-Import Bank (Afreximbank) has announced a $120 million credit facility to Djibouti’s Great Horn Investment Holding (GHIH) for the execution of projects in the country’s Damerjog Industrial Development Free Trade Zone.

The facility came following a meeting between Afreximbank President Prof. Benedict Oramah and Omar Guelleh, President of Djibouti in Nairobi on the sidelines of the ongoing Summit of Heads of State of the African Union.

It is part of $155 million for work on the free trade zone, and the remaining $35 million withe the Banque pour Ie Commerce et I’Indunstrie Mer Rouge (BCIMR) of Djibouti financing the remaining.

“The crucial contribution of this landmark deal lies in its potential to deliver a boost to the development of the industrial capacity of Djibouti and its neighbors by assuring the implementation of critical trade enabling infrastructure to support bulk handling of liquid products,” said Prof Oramah.

Proceeds of the facility will go towards the completion of the Damerjog Oil Jetty, which will provide marine connectivity to the free trade zone, and for the construction of a 150,000m³ first storage depot/oil tank farm, as well as for other costs related to the projects.

Afreximbank first deal GHIH

The deal, which is Afreximbank’s first in Djibouti in collaboration with GHIH and the government, seeks to support the development of a trade-enabling infrastructure to assist Djibouti in achieving its plan to become a regional trans-shipment and logistics hub.

The establishment of a jetty and bulk port in the Djibouti Free Trade Zone will add significant value to Djibouti’s role as a trans-shipment hub for neighbouring landlocked countries. Afreximbank is very proud to contribute to such a crucial project for Djibouti and the wider region.”

It will also promote intra-African trade, given that Djibouti’s economy is largely based on the provision of marine services to neighbouring Ethiopia and Somalia, by offering them a gateway for ocean-borne freight.

The facility is also providing support and capacity to SOMAGEC, a Moroccan construction company which is Afreximbank’s Intra-African Trade Champion.

Under the Intra-African Trade Champion programme, Afreximbank supports African companies to execute infrastructure projects in other African countries and assists them to compete globally with international players.

“In line with our multi-year infrastructure investment strategy aiming to position our country as a logistical and commercial hub for the sub-region, we’re meeting this growing demand by delivering the infrastructure necessary, to support and enhance the economic and efficient movement of petroleum products in the region whilst developing a core economic belt with Ethiopia and ultimately an industrial base for East and Central Africa,” said GHIH’s Chairman Aboubaker Hadi Omar.

Boosting Development in Africa

Afreximbank has been a key supporter of the engineering, procurement and construction (EPC) market in Africa with financing and facilitation interventions totaling $13 billion in the last 6 years. This includes financing of more than $7-billion worth of EPC-related transactions and issuance of trade instruments worth more than $6 billion to support and facilitate the award of contracts to African contractors. 

GHIH, a state-owned investment holding vehicle of the Government of Djibouti, is responsible for logistics and transportation infrastructure. It holds interest in about 18 of the largest state-owned companies in the country, with a portfolio that includes companies in shipping, bunkering, management of free zones, storage, road transport and port security.