Emerging markets are increasingly feeling the pressures resulting from ongoing economic pressures, and Africa is no exception. The continent faces a major challenge: a trade financing gap estimated at $100 billion annually. This significant shortfall complicates Africa’s ability to fully engage in global trade and realize its economic potential.
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One of the main reasons behind this gap is the presence of trade barriers. Unfair trade agreements, coupled with high tariffs and numerous non-tariff barriers, create an unlevel playing field. These obstacles undermine the competitiveness of African economies on the international stage, limiting their growth and prosperity. Overcoming these barriers is critical to unleashing Africa’s trade potential and promoting sustainable economic development.
The upcoming 25th edition of the Afreximbank event (4-6 November) is poised to address the critical trade finance gap affecting African economies. This year’s event will focus on innovative financing structures designed to open new business opportunities, especially for SMEs, which make up 90% of businesses on the continent. With a focus on going beyond traditional banking, this event seeks to empower these vital companies. This will be followed by a one-day factoring workshop on November 7, 2025, which will provide more tools and strategies for growth according to Afreximbank.
The upcoming event will host a diverse number of leading African and global trade finance professionals, banking professionals, corporate representatives and regulators. This pool of expertise promises to foster collaborative solutions and drive impactful change in the trade finance landscape in Africa.
According to Ms. Gwen Mwaba, Managing Director of Trade Finance and Correspondent Banking, “Structured trade finance is Africa’s ticket to turning unbankable deals into viable trade.” She emphasizes that these tools enable financial leaders to unleash growth at scale, especially in difficult circumstances. However, despite these promising initiatives, Africa has struggled to adapt, facing recurring issues that persist despite ongoing efforts and discussions.
In my opinion, Africa needs to explore different strategies to turn the page and compete internationally. Taking advantage of the latest technology can be a game changer. Digital trade finance, which includes blockchain, e-invoicing, and digital platforms, can streamline processes, reduce fraud, and improve access to finance for SMEs. These technologies can also provide valuable market data. Digital payment systems can help mitigate currency fluctuations and reduce reliance on the US dollar, boosting trade in local currencies. Furthermore, the adoption of digital fintech innovations such as peer-to-peer lending platforms, which are expanding rapidly, can provide alternatives to traditional banking, enabling individuals and SMEs to transact without relying on banks, especially in light of current high interest rates.
This year’s event will include keynote addresses, including “Unlocking the Potential of Africa’s Trade Finance” presented by Mark O’Boin of the World Trade Organization. Sylvia Macri of S&P Global Commodity Insights will also deliver a keynote address, and several workshops are scheduled, providing attendees with a wealth of practical insights and knowledge.
Unlocking the potential of trade finance in Africa and enabling SMEs to compete internationally is indeed possible, but depends on implementing the right approach and strategy.
