African Development Bank and Exim Bank Tanzania sign $10 million trade facility

The African Development Bank (AfDB) and Exim Bank Tanzania Limited signed a $10 million trade finance transaction guarantee facility on 28 September to boost trade finance activities in Tanzania, according to a press release by the African Development Bank. The agreement was formalized at a signing event held in Dar es Salaam. Under the arrangement, the Bank Group will provide a guarantee of up to 100% to confirming banks against non-payment risks arising from letters of credit and similar trade finance instruments issued by Exim Bank Tanzania. The facility targets small and medium-sized enterprises (SMEs) and local corporates engaged in the import sector. It is also expected to advance intra-Africa trade objectives linked to the African Continental Free Trade Area (AfCFTA).

The African Development Bank’s Transaction Guarantee is an unfunded instrument that provides up to 100% non-payment risk cover to confirming banks for trade finance transactions of eligible Africa-based issuing banks. The mechanism is designed to strengthen trade finance activity across the continent. Tanzania’s private sector is positioned to benefit directly from this type of support. The facility is aligned with the Bank Group’s Tanzania Country Strategy Paper 2026-2031, which prioritizes enhancing the private sector business environment for job creation. It also supports Tanzania Vision 2050, aimed at building an inclusive, climate-resilient, high-income, and globally competitive economy by 2050.

Speaking at the signing event, the Bank Group’s Country Manager for Tanzania, Mary Monyau, highlighted the facility’s relevance to Tanzania’s trade finance needs. She noted its role in reducing reliance on trade, agriculture, manufacturing, and energy imports. Monyau underlined that the agreement reflects the Bank’s broader strategic direction. She linked the facility to efforts in mobilizing capital and unlocking SME financing. She also emphasized its contribution to strengthening Africa’s regional integration.

“This facility is in line with the African Development Bank’s Cardinal Points on managing risk and mobilising capital, unlocking SME financing, as well as enhancing Africa’s regional integration and elevating its role in global markets,” Monyau said.

Exim Bank Tanzania’s Chief Financial Officer Shani Kinswaga described the agreement as more than a financing arrangement. He said it strengthens the financial infrastructure required to support Tanzania’s growing trade ambitions. Kinswaga added that the partnership gives Exim Bank an opportunity to deepen its trade finance business. He noted it enables Tanzanian businesses to participate more confidently in regional and international markets.

Kinswaga further explained that the partnership’s value lies in the additional capacity and risk support it provides. This allows Exim Bank to pursue viable trade opportunities with greater confidence. At the same time, the institution will maintain disciplined risk management and sound credit standards. The signing is expected to benefit Tanzania’s private sector while advancing the Bank Group’s country strategy. Together, the two institutions aim to reinforce trade finance capacity and support local businesses across the country.