Connect with us

Markets

Factoring Can Bridge Financing Gap, Says Afreximbank

Published

on

afreximbank
  • Factoring Can Bridge Financing Gap, Says Afreximbank

African Export-Import Bank (Afreximbank) has reiterated the importance of factoring services in bridging the assessed gap in financing among small and medium-sized enterprises (SMEs) in Africa.

While admitting that the business model was scripted to address the challenges the SMEs face in accessing funding for business activities, the bank noted that it is also important to develop the model across Africa.

In factoring, an exporter or supplier sells his accounts receivable or invoices at a discount to a third party, called a factor, in exchange for immediate cash with which to finance continued business.

The Managing Director of the Intra-African Trade Initiative of Afreximbank, Kanayo Awani, at a two-day factoring promotion seminar in Douala, Cameroon, said the effectiveness and potential of factoring services to support SMEs became even higher during periods of financial distress.

She said that because of its unique features, factoring was well-suited for facilitating financial inclusion of SMEs. The seminar followed similar factoring promotion and capacity-building events organised by Afreximbank in Egypt, Ghana, Nigeria, Tanzania, Kenya, Zambia and Mauritius.

To support its strategy to grow intra-African trade and facilitate greater SME contribution to regional and global supply chains, Afreximbank had been championing the development of factoring in Africa.

The support had been through provision of credit lines to factors, capacity-building workshops, policy and regulatory inputs, advisory services and technical assistance to promote best practices.

“We are proud to note the increased awareness about factoring in Africa and, more tangibly, the growing number of factoring companies on account of our efforts,” she said.
Increasing factoring transaction volumes and ensuring stronger legal frameworks were also part of the Bank’s targets.

The representative of the Governor of the Littoral Region of Cameroon, Aboubakar Njikam, said the country had enacted legislation to regulate factoring in recognition of its importance in unlocking economic development.

Cameroon was sparring no effort in promoting the development and use of the product and the new law provided the enabling environment for its growth in the coming years. Cameroon is among African countries where new factors are emerging and its factoring volumes reached about €40 million in 2016.

In addition to providing networking opportunities for international and sub-regional factoring practitioners, the seminar introduced participants to the principles, mechanics, risks and benefits of factoring using case studies and success stories.

The Afreximbank Model Law on Factoring was also explained to participants, highlighting the ways in which it could be adapted to suit different local regulatory environments.

The seminar was organised in collaboration with FCI, the global representative body for the factoring and receivables finance industry; Afriland First Bank Group; and CamLease, the Cameroonian leasing association. More than 150 finance professionals, legal practitioners, corporates and SMEs from Cameroun, the Central Africa region and beyond attended the event.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading
Comments

Crude Oil

Oil Prices Continue to Slide: Drops Over 1% Amid Surging U.S. Stockpiles

Published

on

Crude Oil

Amidst growing concerns over surging U.S. stockpiles and indications of static output policies from major oil-producing nations, oil prices declined for a second consecutive day by 1% on Wednesday.

Brent crude oil, against which the Nigerian oil price is measured, shed 97 cents or 1.12% to $85.28 per barrel.

Similarly, U.S. West Texas Intermediate (WTI) crude slumped by 93 cents or a 1.14% fall to close at $80.69.

The recent downtrend in oil prices comes after they reached their highest level since October last week.

However, ongoing concerns regarding burgeoning U.S. crude inventories and uncertainties surrounding potential inaction by the OPEC+ group in their forthcoming technical meeting have exacerbated the downward momentum.

Market analysts attribute the decline to expectations of minimal adjustments to oil output policies by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known collectively as OPEC+, until a full ministerial meeting scheduled for June.

In addition to concerns about excess supply, the market’s attention is also focused on the impending release of official government data on U.S. crude inventories, scheduled for Wednesday at 10:30 a.m. EDT (1430 GMT).

Analysts are keenly observing OPEC members for any signals of deviation from their production quotas, suggesting further volatility may lie ahead in the oil market.

Continue Reading

Energy

Nigeria Targets $5bn Investments in Oil and Gas Sector, Says Government

Published

on

Crude Oil - Investors King

Nigeria is setting its sights on attracting $5 billion worth of investments in its oil and gas sector, according to statements made by government officials during an oil and gas sector retreat in Abuja.

During the retreat organized by the Federal Ministry of Petroleum Resources, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, explained the importance of ramping up crude oil production and creating an environment conducive to attracting investments.

He highlighted the need to work closely with agencies like the Nigerian National Petroleum Company Limited (NNPCL) to achieve these goals.

Lokpobiri acknowledged the challenges posed by issues such as insecurity and pipeline vandalism but expressed confidence in the government’s ability to tackle them effectively.

He stressed the necessity of a globally competitive regulatory framework to encourage investment in the sector.

The minister’s remarks were echoed by Mele Kyari, the Group Chief Executive Officer of NNPCL, who spoke at the 2024 Strategic Women in Energy, Oil, and Gas Leadership Summit.

Kyari stressed the critical role of energy in driving economic growth and development and explained that Nigeria still faces challenges in providing stable electricity to its citizens.

Kyari outlined NNPCL’s vision for the future, which includes increasing crude oil production, expanding refining capacity, and growing the company’s retail network.

He highlighted the importance of leveraging Nigeria’s vast gas resources and optimizing dividend payouts to shareholders.

Overall, the government’s commitment to attracting $5 billion in investments reflects its determination to revitalize the oil and gas sector and drive economic growth in Nigeria.

Continue Reading

Commodities

Palm Oil Rebounds on Upbeat Malaysian Exports Amid Indonesian Supply Concerns

Published

on

Palm Oil - Investors King

Palm oil prices rebounded from a two-day decline on reports that Malaysian exports will be robust this month despite concerns over potential supply disruptions from Indonesia, the world’s largest palm oil exporter.

The market saw a significant surge as Malaysian export figures for the current month painted a promising picture.

Senior trader David Ng from IcebergX Sdn. in Kuala Lumpur attributed the morning’s gains to Malaysia’s strong export performance, with shipments climbing by a notable 14% during March 1-25 compared to the previous month.

Increased demand from key regions like Africa, India, and the Middle East contributed to this impressive growth, as reported by Intertek Testing Services.

However, amidst this positivity, investors are closely monitoring developments in Indonesia. The Indonesian government’s contemplation of revising its domestic market obligation policy, potentially linking it to production rather than exports, has stirred market concerns.

Edy Priyono, a deputy at the presidential staff office in Jakarta, indicated that this proposed shift aims to mitigate vulnerability to fluctuations in export demand.

Yet, it could potentially constrain supply availability from Indonesia in the future to stabilize domestic prices.

This uncertainty surrounding Indonesian policies has added a layer of complexity to palm oil market dynamics, prompting investors to react cautiously despite Malaysia’s promising export performance.

The prospect of Indonesian supply disruptions underscores the delicacy of global palm oil supply chains and their susceptibility to geopolitical and regulatory factors.

As the market navigates these developments, stakeholders remain attentive to both export data from Malaysia and policy shifts in Indonesia, recognizing their significant impact on palm oil prices and market stability.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending