France to Invest in African Trade & Investment Development Insurance (ATIDI)
France is set to become a shareholder in the African Trade & Investment Development Insurance (ATIDI), a pan-African multilateral insurer specializing in covering political, sovereign, and commercial risks in Africa. The announcement was made by Emmanuel Macron during the closing of the Business Forum in Nairobi.
Initiative to Encourage Private Investments
This initiative, led by Sidi Ould Tah, President of the African Development Bank (AfDB), aims to create a "first loss" guarantee mechanism to encourage private investments in African economies considered higher-risk. The mechanism is expected to be presented at the G7 summit in Évian in June. According to Emmanuel Macron, several African countries suffering from a downgrade in their sovereign rating remain excluded from traditional guarantee mechanisms offered by multilateral banks. The goal is to use ATIDI as a tool to absorb the initial levels of risk, thereby reassuring banks and investors.
About ATIDI
Based in Nairobi and supported by the African Development Bank since 2013, ATIDI currently has 24 African member states. The institution claims to have supported over $93 billion in trade and investment operations on the continent since its creation in 2001.
Recent Developments
The French announcement comes just a few weeks after Germany's, which recently became a shareholder in ATIDI through a $32 million investment, led in part by the German public bank KfW. This move demonstrates the growing interest of European countries in supporting African economic development through innovative insurance mechanisms.
