Afreximbank says its closing in on setting up regional HQ in Nairobi

According to the Business Daily, Kenya will in a few days sign a deal to pave way for the setting up of a Sh3 billion regional headquarters by the African Export Import Bank (Afreximbank) in Nairobi.

The deal which was to be signed last Wednesday but Afreximbank head of communication Obi Emekekwue was quoted saying that some elements of the deal were being finalised.

“I understand that the signing is not taking place today after all as they are fine-tuning some elements. We will be in touch as soon as the agreement is finalised,” Mr Emekekwue said.

The deal has been on the table for two years, but threatened to unravel over the government’s refusal to grant the multilateral lender and its staff diplomatic status. However, it was not immediately clear whether Kenya had accepted all the conditions demanded by the regional bank.

The Bank then threatened that should Kenya not accept its conditions, it would move the headquarters to Ethiopia.

The government was said to be uncomfortable with several clauses in a draft agreement touching on taxation and diplomatic privileges that Afreximbank had set as preconditions for locating its regional headquarters in Nairobi.

The lender had argued that the privileges were not unique to Kenya as they had been granted by host governments in Abuja (Nigeria), Harare (Zimbabwe), Abidjan (Cote d’Ivoire), Tunis (Tunisia) and Egypt (Cairo), which is its headquarters.

Afreximbank finances and promotes intra-and extra-African trade. The institution has in the past decade become a significant player in Kenya’s economy, having financed major deals amounting to nearly Sh30 billion including the financing of Kenya Airways’ $2 billion (Sh200 billion)expansion project.

This year it loaned the Kenya government Sh20 billion ($200 million) to help save the airline, which has been struggling under the weight of massive debts.

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The bank has also lent power distributor Kenya Power Sh1.5 billion ($150 million) to support the Rural Electrification Programme.

It has lent billions of shillings to private financial institutions in Kenya, including Sh2 billion ($200 million) to the National Bank of Kenya for on-lending to exporters and Sh5 billion ($50 million) to NIC Bank, which supports importers with letters of credit.

Source;  Business Daily