Regional Trade Facilitation Project for Africa RTFP

1
Regional Trade Facilitation Project for Africa
(RTFP)

• A COMESA-WORLD BANK PROJECT

2
Regional Trade Facilitation Project for Africa
(RTFP)

• Provides political risk insurance for cross-
  border trade
• Administered by the African Trade Insurance
  Agency (ATI)

3
Regional Trade Facilitation Project for Africa

• Membership in ATI and participation in the
  project is
• OPEN TO ALL AFRICAN COUNTRIES

4
Regional Trade Facilitation Project for Africa

• Which Government Performance Risks are covered?
• expropriation
• interference in the management or operations of
  an enterprise causing non payment
• imposition of exchange controls
• foreign exchange shortages
• retrospective imposition of import or export
  taxes
• confiscation of goods
• withdrawal of import or export licenses
• transit risk

5
Regional Trade Facilitation Project for Africa

• Which non-Government Performance Risks are
  covered?
• War
• Civil disturbance
• Civil commotion
• Embargoes

6
Regional Trade Facilitation Project for Africa

• Who is covered?
• Foreigners engaged in trade transactions in a
  participating country, against political risks in
  that country
• Exporters of goods and services in participating
  countries, against political risks in the buyers
  country

7
Regional Trade Facilitation Project for Africa

• What types of transactions are covered?
• ANY TYPE OF TRANSACTION THAT LEADS TO A
  PRODUCTIVE ACTIVITY, other than equity investment

8
Regional Trade Facilitation Project for Africa

• How is the project structured?
• Participating countries borrow from the World
  Bank
• Control of funds ceded to ATI
• ATI operates in partnership with private insurers
• Insurance policies are issued by the private
  insurers
• Private insurers are given exclusive access to WB
  funds
• Private insurers leverage WB funds
• Premium sharing formula recognises first loss
  arrangements

9
Regional Trade Facilitation Project for Africa

• What are the projects key design aspects?
• Single country schemes
• First come-first served principle
• Uniform premiums
• Strong and standardized disciplines
• Appointment of Ombudsman

10
Regional Trade Facilitation Project for Africa

• What are the benefits of a regional approach?
• THE MORE COUNTRIES PARTICIPATE, THE MORE POWERFUL
  AND EFFECTIVE THE PROJECT WILL BE

11
Regional Trade Facilitation Project for Africa

• What is the African Trade Insurance Agency?
• NEW MULTILATERAL AGENCY UNDER SECTION 102 OF THE
  UN CHARTER

12
Regional Trade Facilitation Project for Africa

• Catalyzing trade credit insurance in Africa
• MAJOR CREDIT INSURERS HAVE EXPRESSED INTEREST IN
  ENTERING THE AFRICAN MARKET
• IF POLITICAL RISK COVER IS AVAILABLE