Rwanda to host AfCFTA Adjustment Fund

AfCFTA Fund

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The AfCFTA Secretariat and African Export-Import Bank (Afreximbank) have signed a host country agreement with the Republic of Rwanda for the AfCFTA Adjustment Fund, meant to address potential tariff revenue losses resulting from AfCFTA’s implementation.

The AfCFTA Adjustment Fund, which will be managed by the Fund for Export Development in Africa (FEDA), the impact investment arm of Afreximbank, will address potential tariff revenue losses and infrastructure deficits so as to facilitate trade growth and possible supply chain disruptions that states parties may face in the implementation of the AfCFTA Agreement.

Established by the AfCFTA Secretariat and Afreximbank following a mandate from the African Union Assembly and the AfCFTA Council of Ministers responsible for Trade, the Fund is meant to support AfCFTA State Parties to adjust to the new liberalised and integrated trading environment established under the AfCFTA Agreement.

According to a press statement by the AfCFTA Secreteriat, the host agreement was signed Friday in Kigali, Rwanda, by the trio of Mr Wamkele Mene, Secretary-General of the AfCFTA Secretariat, Professor Benedict Oramah, President of Afreximbank (represented) as well as Dr. Vincent Biruta, Rwanda’s foreign minister.

In his remarks at the signing ceremony, Wamkele Mene, secretary-general of the AfCFTA Secretariat, described the Fund as a critical instrument in the realisation of the AfCFTA – by addressing potential tariff revenue losses and infrastructure deficits so as to facilitate trade growth and possible supply chain disruptions that states parties may face in the implementation of the Agreement, among others.

Similarly, Prof. Benedict Oramah, president of Afreximbank, said the signing of the host country agreement completes the incorporation of the fund’s legal entities and marks the establishment of the necessary governance structures to facilitate its day-to-day operations. “It breathes new life into the AfCFTA Agreement and empower the AfCFTA Secretariat to deliver on the promise of the Agreement.”

The Adjustment Fund consists of three sub-funds namely, the Base Fund, which will utilise contributions from AfCFTA State Parties as well as grants and technical assistance to address tariff revenue losses emanating from the Agreement’s implementation; the General Fund, which will finance the development of trade enabling infrastructure; as well as the Credit Fund, aimed at mobilising commercial funding to support public and private sectors to adjust and take advantage of the opportunities created by the AfCFTA.