Africa: Expanding access to trade finance is necessary for SMEs

November 29th, 2021 – When it comes to enhancing access to trade finance for African small and medium-sized enterprises (SMEs), current challenges call for innovative solutions.

The African continent represents a market of approximately 1.2 billion people – most of whom are under the age of 30 – and a collective GDP of $2.5trn, but currently accounts for a small portion of global trade (2%). Intra-Africa trade is also low, about 18% of the total for the continent, representing a missed opportunity for African businesses.

The majority of trade participants in Africa are SMEs. In 2020 alone, sub-Saharan Africa was home to 44 million micro, small, and medium enterprises, which provide an estimated 80% of jobs across the continent.

Due to their smaller size and sometimes less formal procedures – including lack of digitization, audits, and credit history – these firms often struggle to secure the financing they need to scale trade operations effectively, holding back both their own development and that of the economy overall.

More…https://www.theafricareport.com/151540/africa-expanding-access-to-trade-finance-is-necessary-for-smes/

Written by The Africa Report
Photo: Global Trade Magazine