ACCRA (Ghana): Britain has stepped up business in French-speaking West and Central Africa as it seeks new frontiers for its exports.
UK Export Finance (Ukef), a state body that helps fund suppliers and foreign buyers of British goods and services, was backing transactions in francophone Africa worth a cumulative £1bil or about US$1.3bil at the end of the 2023-2024 financial year, up from just £3mil in 2017-2018, according to Steven Gray, its West African regional lead.
These countries now represents about 13% of Ukef’s portfolio on the continent.
“Historically, you would have thought that because of the language barrier, these francophone markets would have been closed to Britain,” Gray said in an interview in Ghana’s capital here.
“We may speak a medley of languages in the room, but we speak a common language, which is commerce.”
For more than a century, Ukef has tried to stoke global demand for British goods and services by offering government-guaranteed loans, insurance and other support.
Britain is positioning itself to grow just as French public investment bank Bpifrance grapples with strained relations between France and some of its former colonies. Meanwhile, China’s export credit agency Sinosure is increasingly dominant.
The Treasury raised Ukef’s global credit exposure limit to £60bil last year, up from £50bil.
The agency “has been aggressively expanding its reach”, Gray said.
Britain typically runs a global trade deficit, and its biggest trading partner, the European Union, lost some of its appetite after the country left the bloc.
This has been partly offset by a surplus with other nations, resulting in an overall deficit of £33bil last year, according to a parliamentary report.
In the financial year ending March 2024, Ukef covered £1.3bil of new business across Africa, making the continent its largest market for new business, followed by the Middle East, according to the agency’s annual report.
The organisation has recently backed projects including a £106mil drainage upgrade in Benin and £68mil road construction works in Togo, both French-speaking nations.
Major investments like this have become more reliant on loan guarantees or credit insurance in recent years, with a jump in interest rates making borrowing in US dollars more expensive.
Both Ukef and Bpifrance are preparing for events in Africa to forge local links in the coming months.
“We haven’t slowed down backing transactions,” Arnaud Floris, Bpifrance’s Africa head, said from Ivory Coast’s commercial capital, Abidjan. “We continue at a good pace.” — Bloomberg
