Libya is joining Afreximbank and preparing major projects to advance intra-African trade. The development of the Misurata Free Zone, the road to Chad and Niger, and support for the Sahel-Saharan Bank for Investment and Trade are some of the key projects targeted in this new era of cooperation. This partnership is expected to facilitate the development of vital infrastructure, boost trade, and support Libya’s efforts in economic diversification and reconstruction.

Afreximbank : Libya’s Membership

Libya officially joins the agreement establishing Afreximbank, becoming the 53rd member country of the pan-African financial institution. The oil-rich country’s membership marks a crucial step in advancing continental integration through trade and investment.

Signed by Libyan Finance Minister Dr. Khaled Al-Mabrouk Abdullah, the accession document lays the foundation for a new era of cooperation between Libya and the African Export-Import Bank (Afreximbank). This partnership is expected to facilitate the development of vital infrastructure, stimulate trade, and support Libya’s efforts in economic diversification and reconstruction.

Key Development Projects to Boost Intra-African Trade

Libya’s collaboration with Afreximbank focuses on transformative projects aimed at enhancing regional connectivity and trade.

Development of the Misurata Free Zone: This project aims to make Misurata a thriving commercial and logistics hub, stimulating economic growth and attracting foreign investments.

• Road Connectivity with Chad and Niger : The construction of a road linking Libya to Chad and Niger is expected to strengthen cross-border trade, fostering stronger economic ties in North and West Africa.
• Support for the Sahel-Saharan Bank for Investment and Trade (BSIC ): Afreximbank will provide financial and technical assistance to expand BSIC’s operations across East Africa, enabling broader access to regional trade finance.
• Training for Libyan Exporters : To capitalize on growing African markets, Libyan exporters will receive technical training and support in trade finance structuring, allowing them to access and benefit from intra-African trade opportunities effectively.

These initiatives not only improve Libya’s economic prospects but also align with Afreximbank’s mission to promote industrialization and trade integration across the continent.

Catalyst Agreement for Libya’s Economic Reconstruction

Libya’s accession to Afreximbank comes at a critical time as the country seeks to rebuild its economy after years of instability. With a GDP of USD 50.49 billion in 2023, Libya ranks as the 12th largest economy in Africa. However, less than 10 % of its trade is with other African countries, highlighting significant untapped potential.

Dr. Khaled Al-Mabrouk Abdullah emphasizes the importance of this partnership in supporting Libya’s reconstruction and economic diversification goals. This partnership will not only provide vital financial and technical support to Libya but also strengthen the country’s role in intra-African trade. By leveraging resources, Libya aims to position itself as a regional commercial hub and a key player in Africa’s economic landscape.

Afreximbank’s Role in Transforming African Trade

Since its inception, Afreximbank has played a crucial role in financing and promoting trade in Africa. The institution’s innovative solutions support the transformation of Africa’s trade structure, accelerating industrialization and promoting intra-regional trade.

Pan-African Payment and Settlement System (PAPSS)

Afreximbank’s commitment to the African Continental Free Trade Area (AfCFTA) is demonstrated by the launch of PAPSS, a revolutionary platform adopted by the African Union. This system enables seamless cross-border payments in local currencies, reducing transaction costs and enhancing trade efficiency.

To support AfCFTA-participating countries, Afreximbank is establishing a USD 10 billion adjustment fund. This initiative aims to help member states adapt to the new trade dynamics resulting from the free trade agreement.

With total assets and contingency reserves exceeding USD 37.3 billion in December 2023, Afreximbank continues to drive economic transformation in Africa. Its subsidiaries, including the Fund for Export Development in Africa (FEDA) and AfrexInsure, further extend its impact by supporting export-oriented businesses and managing trade-related risks.

Unlocking Libya’s Trade Potential

By joining Afreximbank, Libya will gain access to a set of financial and technical resources tailored to deepen its trade and investment relationships with other African countries. This partnership is expected to catalyze Libya’s efforts to transition from an oil-dependent economy to a diversified one. Leveraging its geographical position as a gateway between North Africa and the rest of the continent.

Libya’s historical ties with the rest of the continent position it as a crucial player in promoting continental trade and economic integration. This strategic collaboration will enable Libya to leverage Afreximbank’s vast portfolio of products and services, fostering a conducive trade infrastructure and strengthening its economic foundations.

While Libya’s membership represents a significant advancement, ratifying the agreement establishing Afreximbank remains a crucial step to complete the membership process. Once ratified, Libya will fully benefit from its membership, ensuring its public and private sectors have access to Afreximbank’s comprehensive financial solutions.