The export finance arm of the Abu Dhabi Fund for Development, Abu Dhabi Exports Office (ADEX), signed a $30 million trade finance agreement with the Eastern and Southern African Trade and Development Bank (TDB) to strengthen trade between the UAE and the lender’s member states.

As part of the pact, ADEX will arrange for loans through the TDB to buyers and importers from the bank's member states for acquiring goods and services from the UAE.

This corporation is the first of its kind to be signed by ADEX with a foreign financial institution and is anticipated to support both exporters and importers as the global economy faces challenges due to the pandemic.

Saeed Al Dhaheri, acting director general of ADEX, said, “This is not only a difficult time for UAE exporters, but it is also a challenging time for their overseas buyers, chiefly smaller importers who cannot access any direct credit amenities from export-financing institutions”.

Mr. Al Dhaheri further added, “Both are dealing with liquidity and cash flow issues, delayed supplier payments and narrow access to financing. Through our partnership with TDB, we aim to deliver a solution to these challenges that allows both the exporter and importer to fund mutually beneficial transactions quickly and easily”.

Earlier this year, ADFD allocated Dh735 million ($200m) to the Abu Dhabi Exports Office I order to spur economic diversification and increase exports.

The TDA is made up of 22 member countries from Eastern and Southern African states extending from Egypt in the north to Zimbabwe in the south. It also totals a number of multilateral bodies as members including the Africa Reinsurance Corporation, the African Development Bank and the OPEC Fund for Development.

TDB group Managing Director and Chief Executive, Admassu Tadesse, said the trade between the UAE and Africa has doubled over the past 5 years, while it has grown about eight-fold in the past 15 years.

“The figures indicates a rising interest of businesses in the UAE and our region to build resilient trade relations.”

A cooperation agreement was also signed amid both institutions to promote trade between the UAE and Africa. ADEX and TDB will discover potentials of co-financing qualifying transactions and instituting additional lines of credit.