Finance

Africa can still thrive amid global geopolitical upheaval (Image source: Adobe Stock)

Africa has an opportunity to convert geopolitical tensions and shifting global trade patterns into a catalyst for industrialisation and long-term economic resilience, according to a new Afreximbank report

Leveraging Geopolitics for Trade and Industrialisation in Global Africa examines trade and economic developments across the continent and globally, and outlines strategies for African nations to benefit from supply chain realignments and changing geopolitical dynamics.

“Africa stands at a critical juncture,” said Dr Yemi Kale, group chief economist and managing director of research and trade intelligence at Afreximbank.

“Geopolitical tensions and economic fragmentation are reshaping global trade patterns, but they also present a historic opportunity for the continent. By strategically leveraging these shifts, Africa can build a more resilient, competitive and inclusive economic future.”

Despite a challenging global backdrop, the report highlights Africa’s strong recent economic performance.

While global economic growth slowed to 3.4% in 2025 and is projected to ease further to 3.1% in 2026, Africa’s real GDP growth accelerated from 3.4% in 2024 to 4.5% in 2025, outperforming the global average.

Africa’s merchandise trade also expanded by 6.1% to approximately US$1.5 trillion, while aggregate inflation fell significantly from 21.6% in 2024 to 13.1% in 2025.

According to Afreximbank, these gains reflect improved macroeconomic management, ongoing policy reforms and the role of development finance institutions in supporting economic stability.

However, the report warns that significant structural challenges remain.

Africa’s trade finance gap is estimated at approximately US$74bn in 2025, limiting the continent’s ability to fully capitalise on trade and industrial opportunities.

The situation is compounded by foreign exchange constraints and a continued decline in correspondent banking relationships.

The report also notes that evolving shipping routes and persistent disruptions in global logistics networks are increasing freight costs and extending delivery times, particularly for economies dependent on imported inputs and external markets.

To strengthen resilience, Afreximbank identifies accelerated implementation of the African Continental Free Trade Area (AfCFTA), expansion of the Pan-African Payment and Settlement System (PAPSS) and reforms to the global financial architecture as key priorities.

The report notes that stronger industrial ecosystems, increased intra-African trade and sustained financial support will be critical if the continent is to transform geopolitical disruption into sustainable and inclusive economic growth.

“It is imperative for the continent to act decisively to strengthen regional value chains, deepen industrial capacity, expand access to trade finance, and accelerate continental integration,” said Kale, adding that Africa “cannot afford to delay.”

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African boost for sustainable aviation fuels (Image source: Adobe Stock)

Africa’s first privately-financed sustainable aviation fuel (SAF) plant has secured funding from the Emerging Africa & Asia Infrastructure Fund (EAAIF) and various Middle Eastern investors

The deal expands EAAIF’s footprint into the Middle East North Africa (MENA) region, following its ongoing expansion into Asia.

The US$212mn clean fuels project, located in Egypt’s Sokhna Special Economic Zone, will be owned and operated by Green Sky Capital Limited together with its local subsidiary, SAF Fly Egypt.

EAAIF, a Private Infrastructure Development Group (PIDG) company managed by Ninety One, supported a senior secured loan of US$40mn for the development of the plant.

The transaction marks the first project-financed SAF plant in the MENA region.

The facility is designed to produce 200,000 tonnes per annum of biofuels, including SAF, Hydrotreated Vegetable Oil (HVO), bio-propane and bio-naphtha and will utilise commercially proven Hydroprocessed Esters and Fatty Acids (HEFA) technology to convert waste-based feedstock into high-grade sustainable fuel.

To ensure long-term bankability, the transaction will be anchored by Shell who will purchase the facility’s products on a take-or-pay basis and act as its primary feedstock provider.

Martijn Proos, co-head of emerging market alternative credit, Ninety One, the fund manager of EAAIF, said the transaction arrives at a critical juncture for the global energy market.

“Amid heightened geopolitical volatility and energy market uncertainty, this first-of-its-kind facility provides a practical solution to advancing both decarbonisation and energy security,”he said.

“By acting as the global mandated leadarranger, Ninety One and EAAIF are demonstrating how institutional capital can be mobilised to support the decarbonisation of hard-to-abate sectors like aviation, which is projected to account for 5% of global emissions by 2050 without intervention.”

The project is being developed with the support of regional sponsors, including Al Mana Holding, a Qatari diversified conglomerate, and Vision Invest, a Saudi Arabian infrastructure investor and developer.

Ninety One acted as the global mandated lead arranger and coordinating lender, facilitating the mobilisation of a total debt package of US$142.9mn with a US$40 million commitment from EAAIF and Ninety One’s Emerging Markets Transition Debt (EMTD) Fund.

Ninety One has also mobilised the participation of Qatar National Bank (QNB) via its Egyptian subsidiary, QNB S.A.E, with a commitment of up to US$31.4mn.

The debt financing was completed by The Arab Energy Fund, which acted as co-MLA and global structuring lender committed US$71.4mn to the project.

SAF is estimated to offer up to an 80% reduction in CO₂ emissions, compared to conventional jet fuel, supporting the aviation industry’s target of reaching net-zero by 2050.

The project's strategic location near the Suez Canal offers a direct export route to key demand centres in the EU and UK, which are currently implementing strict SAF mandates.

The transaction also demonstrates strong appetite among regional and international lenders for renewable fuels infrastructure, supporting both energy security and price stability amid heightened global volatility.

“Emerging markets have been transitioning toward renewables and cleaner energy sources for some time, driven by rising energy costs and the need to strengthen energy security,” said Alper Kilic, head of alternative credit, Ninety One.

“This investment highlights the critical role long-term capital plays in scaling next-generation energy infrastructure in emerging markets.”

He added that sustainable aviation fuel is “one of the most compelling – and challenging – decarbonisation pathways” requiring proven technology and strong commercial structures to deliver at scale.

“This project demonstrates how institutional investors can pursue attractive risk-adjusted returns while supporting the real-economy transition, and underscores the growing opportunity for transition debt strategies to finance high-impact assets in hard-to-abate sectors.”

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Finance boost for Africa’s supply chain sector (Image source: Adobe Stock)

Standard Chartered and the International Finance Corporation (IFC) have announced a new risk sharing facility aimed at strengthening supply chains across Africa

The partnership will introduce supply chain finance solutions in eight markets – Ivory Coast, Egypt, Ghana, Kenya, Nigeria, South Africa, Tanzania and Zambia – supporting companies in key sectors such as agriculture, healthcare and manufacturing.

The facility aims to help ensure suppliers get faster payments, freeing up working capital to improve production, pay wages and hire.

The risk-sharing facility will cover up to US$300mn in supply chain and trade finance assets originated by Standard Chartered in Africa.

It comprises a range of underlying supply chain financing instruments – such as payables finance, receivables discounting and pre-shipment finance programmes – to help smaller firms get paid earlier, reduce the cost of working capital, and invest in growth.

“This US$300mn facility with IFC underscores our shared commitment to strengthening Africa's supply chains and enabling sustainable business growth,” said Dalu Ajene, chief executive and head of coverage, Standard Chartered Africa.

“As a super-connector bank with deep expertise across key trade corridors linking Africa to Europe, Asia, the Middle East and the Americas, we are uniquely positioned to channel capital and innovation into the real economy. By expanding access to supply chain finance, we are helping African companies unlock liquidity, manage risk, and invest with confidence.”

Ajene said the collaboration unites Standard Chartered’s cross-border expertise with IFC’s development mandate to empower businesses – from major corporations to smaller local suppliers – “to engage more actively in regional and global trade, fostering job creation and promoting inclusive growth.”

IFC will provide guarantees for up to US$150mn from its own account, with US$100mn committed as the first tranche under the scheme, to support transactions in both US dollars and selected local currencies.

Over the next three years, the partnership is projected to enable about US$1.9bn in supply chain finance transactions, providing access to finance for firms across Africa.

It aims to support more than 500 suppliers, including small and medium enterprises (SMEs), in both domestic and global value chains, with the potential to indirectly benefit over 1 million farmers.

“Supply chain finance is among the fastest ways to narrow the growing finance gap that businesses, particularly small and medium enterprises, are facing in emerging economies,” said Mohamed Gouled, IFC’s vice president, products & clients.

“By partnering with Standard Chartered to support companies at the center of strategic value chains, we can unlock much-needed working capital at scale for businesses across Africa, including smaller firms and farmers, making supply chains more competitive and boosting job creation.”

According to IFC, global demand for supply chain finance has surged – in 2025, the estimated volume reached about US$2.7trn, showing an 8% increase year-on-year.

Yet supply chain finance has not scaled at the same pace in emerging markets, it says, especially in lower income and fragile contexts, largely because commercial banks tend to focus on developed markets.

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AFC reaches financial close on the Poro Power Green Bond (Image source: Adobe Stock)

Africa Finance Corporation (AFC) has reached financial close and disbursed €43mn under the Poro Power Green Bond, to be used to fund construction of a 66 MW solar power plant in the northern Korhogo region in Cote d’Ivoire

Structured as a €65mn dual-currency facility in euros and CFA francs, it marks the first project finance green bond in Cote d’Ivoire and across the West African Economic and Monetary Union (WAEMU).

The solar power plant, developed by Poro Power, is expected to be operational in 2027 and will become the country’s largest solar plant.

The solar plant is expected to provide electricity to more than 100,000 households and avoid over 72,000 tons of CO2 emissions annually, contributing to greater energy access and the country’s target of increasing the share of renewables in the energy mix to 45% by 2030.

AFC acted as lead underwriter and co-arranger, helping to structure the innovative dual-currency green bond that creates what it called a ‘replicable model’ for mobilising African capital into bankable infrastructure.

It also called the transaction a milestone for Côte d’Ivoire’s capital markets and for African infrastructure more broadly.

Historically, long-term infrastructure financing in the country has depended heavily on international capital.

By contrast, the Poro Power Green Bond was African-led, structured, and fully funded by African institutions.

Samaila Zubairu, president and CEO of AFC, said the Poro Power Green Bond sets a new benchmark for sustainable infrastructure financing in Africa.

“This landmark transaction demonstrates the growing capacity of African institutions to mobilise domestic capital and expertise to deliver transformative infrastructure projects,” said said Zubairu.

“We are not only helping to close the infrastructure gap, but also creating scalable, homegrown financing models that can be replicated across the continent.”

The transaction builds on AFC’s track record in Côte d’Ivoire across the power and transport sectors.

In the energy sector, it includes the 44MW Singrobo-Ahouaty hydropower project, Côte d’Ivoire’s first private hydro independent power producer.

Its investments in the country also include the 1.5km Henri Konan Bédié Bridge, which has eased congestion by 30% since commissioning and improved mobility in Abidjan.

In 2024, AFC also supported the Ivorian government in awarding six road development contracts worth €691.6mn.

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