Kanayo Awani, Executive Vice President of the Intra-African Trade Bank at Afreximbank believes the African Sub Sovereign Government Network will deepen regional integration, and promote grassroots participation in the Africa Continental Free Trade Area. In a chat with CNBC Africa, Awani stressed that sub-sovereigns face challenges such as fiscal, and administration shortfall and a perceived lack of creditworthiness.
Kanayo Awani, Executive Vice President of the Intra-African Trade Bank at Afreximbank believes the African Sub Sovereign Government Network will deepen regional integration, and promote grassroots participation in the Africa Continental Free Trade Area. In a chat with CNBC Africa, Awani stressed that sub-sovereigns face challenges such as fiscal, and administration shortfall and a perceived lack of creditworthiness.' The African Sub-Sovereign Conference, or the network itself, is envisaged to support Intra-Africa, Intra-African trade, and Intra-African investments, in the sense that what we're trying to do is to bridge the gap between national trade policies and local implementation. So it will help us deepen regional integration, but also help in ensuring that there is grassroots participation, the local businesses, the local private sector, and grassroots participation in the benefits of the African Continental Free Trade Area agreements. Alright, I'm looking at the press release from the bank, I see that Afreximbank mentioned commitments to provide about $2 billion here to finance the sub-sovereigns, and also businesses. What are some of the specific financing challenges faced by these sub-sovereign governments in Africa, and how is Afreximbank addressing this through its services? Well, one of the things we're aiming to do is to see how we can support Intra-African investments, so across borders, but also investments among sub-sovereigns within the same country. So it's not just across borders, but within the same country. Some of the challenges they face is a lack of capacity, or the fiscal space, or administrative space, or even to be able to attract finance. And where they're able to attract finance, and there are obvious issues around perceived lack of credit worthiness. Many people and financial institutions want to deal at the center. And so the sub-sovereign network helps to capacitate their investment promotion agencies. One of the key deliverables of this conference on the 26th, or 25th, earlier, before the actual opening of the ceremony, is the training program. That training program is aimed at capacitating the investment promotion agencies to ensure that their states are investment ready. And that's one of the things we're doing. There's also the financing that we support. Technical assistance is what we are providing to those IEPs, working with our partners, Financial Times. But we're also supporting with helping them strengthen their project preparation capacity, and helping also to provide, and help to provide project preparation facilities, for instance, such that they can move from ideas to bankability. We see a lot of that. There are ideas out there, but to see how we can strengthen them, strengthen their capacity to curate those projects, and ensure that they become bankable. So we offer project preparation facilities, but we also offer other financing. The idea of this network is to deploy a suite of financing programs, which we offer through credit and project finance. We also do investment guarantees. We also do provide a suite of our guarantee programs, and provide advisory, as well as advocacy. The idea being to see how we can decentralize, ensure the centralization of ideas, ensure the centralization of financing, but also to see how we can advocate for devolution of powers from the centre to the sub-sovereigns. Yeah, because now looking at the outcomes from the previous conferences here, particularly some of the deals signed, I see the last one was about $1.5 billion here. What lessons can you leverage on this time around to impact this year's gathering in Kisumu? So what we're trying to do more this year is to see, well, $1.5 billion was the value of deals. We expect about that same size of deals this time, and given the fact that we have also, as you rightly mentioned earlier, that we have committed $2 billion to financing under this initiative. One of the things we're doing is, what we're doing now is to ensure that we have, as I mentioned earlier, in terms of attracting investments, trade and investment opportunities into your states, is to ensure that the investment promotion agencies are capacitated. And that's why we have that training program ahead, on the 25th, ahead of November, ahead of the conference itself. We are, guys, go ahead. No, no, you can continue. You know, that's one of the things we're trying to do, you know, move it from, and of course, to know that the last program was a one-day event, which held on the sidelines of the Inter-African Trade Fair in Cairo. This time around, we have spread it over three days so that we can actually have more opportunities to deep dive into the transactions that are being closed, engage at a practical level, and we're also supporting the, ensuring that we have more sub-sovereigns participate in this event, and also take advantage of the program. The reality of the matter is that we need to all go into the AFCFTA agenda collectively, because the borders are in the local areas, they're in the states. The businesses are domiciled in states. Some of them are subject to some of the state's programs, regulations, and laws. So it's important that everybody is dragged into this, for want of a better word, isn't it, tied to the foray, to say that trade and investment is promoted in the context of the AFCFTA, because there are significant benefits that accrue. Yeah, because one key thing that has been coming out is the issue of decentralization for government here, and that was also in the press release from Afraxin Bank, re-echoed here by the Kisumu County Governor, Peter Nyong'o. He emphasized the importance of this in Africa's economic growth, and I'd like to know, from Afraxin Bank's perspective, what you see as some of the key benefits for decentralization, especially for intra-African trade. It's, like I said, one of the main things you want to do with this sort of forum is to bridge the gap between what's happening at the center and what's happening at the local level. It's also to be, in a sense, domesticating trade policies or the national policies at the local level. In a sense, it's also to see how you can promote, I don't know how many people in the States, to see how you can deploy the initiatives around the AFCFTA. Our own financing initiatives, non-financing initiatives are deployed at the state level, not unnecessarily always at the center. Those are some of the benefits that will accrue. And that's what we're seeing in discussions with some of the state governments, with some of the counties and the provinces, is the fact that for those with a sufficient autonomy, they want to engage, they're looking for support to meet some of their own investment needs. And like I said earlier, it's to see, the whole idea is to devolve it, is to decentralize it, so that you can see deeper integration amongst sovereigns, and to bring it to the grassroot levels. Because this is, it's more local, it's more local content, for want of a better word.
Theme: The significance of the African Sub-Sovereign Government Network in enhancing regional integration and promoting grassroots participation in the AFCFTA.
In a bid to deepen regional integration and bolster grassroots participation in the Africa Continental Free Trade Area (AFCFTA), Kanayo Awani, the Executive Vice President of the Intra-African Trade Bank at Afreximbank, sheds light on the significance of the African Sub-Sovereign Government Network. Speaking in an interview with CNBC Africa, Awani highlighted the pivotal role played by sub-sovereigns in enhancing trade, investments, and economic growth across Africa, despite facing challenges such as fiscal constraints, administrative deficiencies, and perceived creditworthiness issues. Awani emphasized that the African Sub-Sovereign Conference aims to bridge the gap between national trade policies and local implementation. By supporting intra-African trade and investments, the network facilitates not only the deepening of regional integration but also ensures that local businesses and private sectors actively participate in reaping the benefits of the AFCFTA agreements. Afreximbank has committed approximately $2 billion to finance sub-sovereigns and businesses in Africa. One of the key hurdles faced by sub-sovereign governments is the lack of capacity, fiscal space, administrative capabilities, and the challenge of attracting finance due to perceived credit risks. To address these challenges, Afreximbank offers a suite of financial programs, including credit and project finance, investment guarantees, technical assistance, and project preparation facilities. The bank collaborates with partners like Financial Times to strengthen the capacity of investment promotion agencies and enhance project bankability. The upcoming conference in Kisumu aims to build on the successes of previous editions, where deals worth $1.5 billion were secured. This year, Afreximbank plans to facilitate similar high-value deals by focusing on capacitating investment promotion agencies through training programs to make states investment-ready. The conference will span three days to provide ample opportunities for engagement and practical discussions to drive intra-African trade and investments. Decentralization emerges as a key theme in Afreximbank's strategy, echoed by Kisumu County Governor Peter Nyong'o, who underlines its importance for Africa's economic growth. By decentralizing trade policies and promoting domestication at the local level, Afreximbank aims to foster deeper integration among sub-sovereigns and drive trade initiatives at the grassroots level. The bank advocates for devolution of powers from central authorities to sub-national governments to enhance regional integration and promote inclusive economic development within Africa.
"The whole idea is to devolve it, is to decentralize it, so that you can see deeper integration amongst sub-sovereigns, and to bring it to the grassroots levels. Because this is, it's more local, it's more local content, for want of a better word."
['Afreximbank', 'Africa Continental Free Trade Area', 'Regional Integration', 'Sub-Sovereign Government Network', 'Intra-African Trade', 'Investment Promotion', 'Fiscal Challenges', 'Creditworthiness', 'Financial Programs', 'Decentralization']