Still reeling from the negative economic effect of the COVID-19 pandemic, Africa, in the first quarter of 2020, recorded over $5 billion in financial outflows.

The African Export-Import Bank (Afreximbank) disclosed this in its latest report, ‘African Trade Finance Survey Report.’

The survey was published in collaboration with the United Nations Economic Commission for Africa, and the African Development Bank-hosted ‘Making Finance Work for Africa Partnership’ on Thursday.

The new continent-wide survey on trade finance launched on April 15, 2021, analysed the evolution of trade finance on the continent during the pandemic and the steps adopted to survive the pandemic’s social and economic impact.

The report is targeted at mapping out strategies to “address market challenges and effectively engage African financial institutions, trade finance intermediaries, regulatory authorities, and national authorities to accelerate efforts to bridge the region’s trade finance gap.”

Afreximbank President Benedict Oramah noted that international banks were avoiding partaking in payment risks in deteriorating economies.

“These massive capital outflows strained African banks, many of which recorded sharp drops in their net foreign assets. This further exacerbated liquidity constraints and undermined the capacity of banks to finance African trade,” Mr Oramah said.

While admitting the strong resilience and expansion of economies of few African countries despite the pandemic, the survey called for more engagements between Central Banks and the industry, improvements in digitalisation, adoption of new technologies, and better data.

Executive Secretary of the UNECA, Vera Songwe, charged Africa’s central bank governors, finance ministers, and development partners to assist with more capital and resources to further enhance Africa’s recovery from outflows.

In her opinion, Bola Adesola, the Senior Vice Chairman for Africa at Standard Chartered, said taking advantage of the African Continental Free Trade Area (AfCFTA) would help drive new businesses in Africa.