Saturday, November 13, 2010

Africa’s exports grow to USD 558 bln

By Solomon Bekele

At the Export-Import Bank of India (Exim Bank) inauguration on Tuesday, September 21, at the Sheraton Addis T.C.A. Ranganathan, Chairman and Managing Director (CMD) of Exim Bank said that Africa is emerging as a major partner in global trade.
“The region’s exports to the world have grown from USD 106 billion in 1998 to USD 558 billion in 2008. Imports to Africa have also grown from USD 133 billion in 1998 to USD 466 billion in 2008,” the CMD of Exim Bank noted.
The inauguration ceremony was attended by Ahmed Shide, State Minister of Finance and Economic Development (MoFED), Tekeda Alemu (PHD), State Minister of Foreign Affairs, Genet Zewde, Ambassador of Ethiopia to India, R. Gopalan Secretary, Department of Financial Services of the Government of India and Bhagwant Singh Bishnoi, Ambassador of India to Ethiopia and Djibouti.
In the keynote address, State Minister Ahmed Shide stated that the historic trade relationship between Ethiopia and India will further be strengthened by the formation of the Exim Bank. “We are very proud that Exim Bank has decided to establish its office in Addis Ababa. We will do everything possible to help the bank achieve its mission,” the State Minister said.
Dr. Tekeda Alemu on his part noted that Ethiopia’s response to the opening of Exim Bank is truly overwhelming. He further reminded the audience what Prime Minister Meles Zenawi said during the EPRDF’s 8th Congress in Adama in relation to India: a dependable ally.
In the seminar session that same day entitled ‘Trade and Investment Opportunities between India and East Africa, different dignitaries including Lamin G. Barrow, Resident Representative of African Development Bank and Prabhakar Dalal, Executive Director of Exim Bank, delivered speeches.
In his speech Lamin G. Barrow said that Africa needs to have a win-win strategy with India. “South Africa is a major player exporting 45 percent of its goods to India. The rest of African countries are lagging behind. India is now becoming an important global economic power. We Africans must exploit this situation,” he said.
Prabhakar Dalal said that India’s leading partner in the Common Market for Eastern Africa (COMESA) region in terms of total bilateral trade are Egypt, Kenya, Sudan, Libya Mauritius and Ethiopia. India’s export to its largest trade partner in the COMESA region is Egypt, which has registered continuous growth from 2004-05 to 2008-09 from USD 444.6 to 1653.9 million.
Vis-à-vis Ethiopia Mr. Dalal said: India’s total exports to Ethiopia increased from USD 55.5 million in 2004-05 to USD 248.9 million in 2008-09. He added that a further increase was made in 2009-10 to USD 254.4 million.
Capital learnt that Ethiopia’s exports to India have shown a modest growth to USD 18.56 million in 2009-10 up from USD 11.2 million in 2008-09. The major export items are pulses, oilseeds, leather and spices.
In an exclusive interview with Capital, T.C.A. Ranganathan, explained the primary factors for opening the headquarters in Addis Ababa, Ethiopia as the centre for East Africa on the grounds that it is a very peaceful country with a stable government and the historical ties between Ethiopia and India.
Asked about Exim Bank’s future plans in addition to the already set USD 640 million for a sugar Plant in Ethiopia, Ranganathan replied: “What we do procedurally is see to requests that come through the Indian Embassy in Addis Ababa. The Ethiopian government and the Indian Embassy’s recommendations on certain bilateral issues will be processed in consultation with the Indian government.,” he added.
According to the Chairman and Managing Director, the Exim Bank has been involved in heavy railway and road constructions in a number of African countries such as: Mozambique, Angola and Mali. This kind of involvement in East Africa is yet to take place.
The Exim Bank has interest to engage in the construction of power plants. “We were involved in the recently concluded rural electrification project, where Indian companies were engaged. We have assisted these electric transmission projects. Our basic intervention is in the capital formation in the host countries,” he commented.
In his concluding remarks Mr. Ranganathan said; “India is playing a significant role in Africa’s development in terms of trade, investment and capacity building. India’s share in Africa’s imports has been 3.6 percent, and its share in Africa’s exports has been almost similar at 3.4 percent. We are aware of the trends, and we are enhancing our engagements by supplying different projects like sugar, power, and cement. So far in East African regions Exim Bank has supported projects worth approximately USD 1 billion. The credit commitment for sugar industry rehabilitation (USD 640 million) in Ethiopia is one of the largest ever in the region.