The African Development Bank (AfDB) has warned that Africa’s trade finance gap could widen to $86.6 billion by 2027, with rising geopolitical tensions in the Middle East increasing energy prices and tightening global credit.
The report, Trade Finance Supply in Africa: Post-COVID Trends and Emerging Opportunities, estimates that Africa’s unmet demand for trade finance in Africa ranged from $74 billion to $92 billion in 2024. The estimated gap of $74 billion represents 5.4 percent of the region’s total merchandise trade value in 2024.
“This outcome was underpinned by swift and substantial interventions following the COVID-19 pandemic from multilateral development banks, governments, export credit agencies, and others,” the report said.
Anthony Simpasa, Director of the Macroeconomic Policy, Forecasting and Research Department at the African Development Bank, said unmet demand for trade finance declined by nearly 10 percent between 2019 and 2024, supported by strong interventions from multilateral development banks, governments, export credit agencies, and global banks.
These interventions were critical in sustaining trade flows, with estimates suggesting that, in the absence of DFI support, the annual trade finance gap could have exceeded $100 billion during the 2020-2024 period.
