The Board of Directors of the African Development Bank (AfDB) have approved a financial package consisting of $20 million in additional equity and a $50 million line of credit (LOC) to finance projects in the Eastern and Southern African Trade and Development Bank (PTA Bank) member states.
The package will allow PTA Bank to finance a mix of small- and medium- scale enterprises as well as regional infrastructure projects, AfDB said in a statement, adding that it would contribute to mobilising financial resources for development of the Tripartite Free Trade Area (TFTA) region, which will ultimately contribute to economic development and generate employment opportunities.
PTA Bank was established in 1985 as the financing arm of the Common Market for East and Southern Africa (COMESA) and is headquartered in Bujumbura, Burundi.
The bank's shareholders include Burundi, Comoros, Democratic Republic of Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Malawi, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tanzania, Uganda, Zambia and Zimbabwe as well as the AfDB and the People's Republic of China.
Its mandate is to foster economic and social development in regional member states through regional integration, trade and project finance, and its financial performance in recent years has been robust, despite the global financial crisis, consistently posting healthy profits over the last five years.
"By focusing on trade finance and financing of small and medium enterprises and infrastructure projects, the financial package to PTA Bank will have positive impact on inclusive growth, private sector development and job creation through increased taxes and government revenues in Eastern and Southern African countries and also across the continent through leverage stemming from regional trade and regional infrastructure projects," the statement read.
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