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N’Djamena, 31 May 2023 – The Republic of Chad and the African Trade Insurance Agency (ATI), have today signed ATI’s Participation Agreement, a condition precedent to the disbursement for the country’s membership capital by the European Investment Bank (EIB). This follows the signing of a financing agreement between the Republic of Chad and the EIB, in November 2020.
The Republic of Chad also ratified the ATI Treaty in 2020, which grants ATI a preferred creditor status, prioritising payment to ATI as a result of sovereign actions or defaults. Following the signed participation agreement, EIB will disburse Chad’s equity, thus completing the country’s membership requirements.
In becoming a shareholder of ATI, Chad stands to benefit from ATI’s investment and trade credit solutions that would accelerate the implementation of Chad’s National development plan, which reflects the government’s commitment to long term development. Additionally, Chad will stay on course of its development priorities, as imbedded in its vision 2030 strategy, whose objective is to make Chad an emerging country.
Chad is home to important natural resources including gold and uranium and stands to benefit from its status as an oil-exporting state. It also boasts of a growing young population, and has the potential to make significant progress towards the Sustainable Development Goals. However, structural development challenges, among other challenges, are hampering the Government’s development efforts and putting pressure on already vulnerable households and communities.
As ATI’s mandate is to help increase trade and investments in the continent, Chad, a landlocked West African nation, will benefit from ATI’s innovative insurance solutions that will not only facilitate more trade and investments within the country, but will also help in the realization of the “Chad we want”, which is in line with Agenda 2063 of the African Union.
Specifically, ATI will achieve this objective by helping a number of sectors of Chad’s economy including supporting the government by issuing sovereign guarantees for government risks. Additionally, ATI attracts more private investments into public sector projects such as infrastructure, Special Economic Zones, access to credit on favorable terms, help to reduce the country’s risk premiums, ameliorate the impacts of climate change through its Regional Liquidity Support Facility (RLSF), and more importantly, ATI will provide comfort to regional and international financial partners interested in investing in the country.
In the last two years, ATI has received enquiries valued at over EUR255M for transactions directed at the Chad market, so there is demand. These enquiries are in the following sectors: Engineering & Construction, Power, Water and Agriculture Services. Once membership is complete, Chad can start benefiting fully from ATI’s products.
ATI has recently seen its membership grow exponentially, thanks to the support of development partners and strategic partnerships with reputable financial institutions such as EIB, who continue to provide membership financing for African countries to join ATI. These strategic partnerships are expected to see ATI expand further into non-member states and other African countries joining the institutions.
For this reason, the multilateral insurer is rebranding to realign its brand with its commercial strategy and to strengthen its identity, reputation and visibility on the continent. The new brand will be unveiled in July at its Annual General Meeting in Kigali, Rwanda.
Quote from Madeleine Alingué, Secretary of State for Economic Prospects and International Partnerships, Chad
“We are doing everything we can to make our country an emerging economy by 2030. By signing this agreement today, we are making a commitment to create a favourable, stable and attractive business climate with a view to making Chad a preferred destination for investment and trade. It is thanks to institutions such as the African Trade Insurance Agency (ATI) that our continent will someday regain its place in the sphere of leading export producers”.
Quote from Manuel Moses, CEO, ATI
“We are eager to receive Chad as the 22nd Member State and look forward to working with the government to identify their priority projects as part of the economic diversification strategy. We are also keen to work with the government of Chad, its financial and non-financial institutions to strengthen SME finance through provision of credit risk reduction solutions for SMEs, thus supporting Intra African Trade.”
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