• Declares skills shortage threatens electric battery manufacturing ambitions, value addition crucial for continent’s growth
• PAPSS gains momentum as 28 African central banks join payment platform
•Afreximbank boss declares stronger perception of Africa key to attracting capital, others, 80% of bank’s assets deployed as loans across continent
James Emejo in Abuja
President of African Export-Import Bank (Afreximbank), Dr. George Elombi, yesterday renewed the bank’s advocacy for the establishment of an African-owned credit ratings agency, adding that the continent can no longer afford to have its economic fortunes and borrowing costs determined largely by foreign institutions.
Speaking during Afreximbank’s mid-year media roundtable in Abuja, Elombi said Africa must take ownership of the institutions that shaped investor perceptions, stressing that other regions already operate their own ratings agencies.
He said, “Why should we not have one when other regions have one?”
He insisted that an African ratings institution would provide a fairer assessment of the continent’s economies and development institutions.
According to him, international perceptions continue to influence Africa’s access to capital, borrowing costs, and investment flows, making it imperative for Africans to tell their own economic story rather than depend solely on external assessments.
Elombi accused international rating agencies of applying inconsistent methodologies that penalised African institutions simply because they operated on the continent.
He pointed out that despite acknowledging Afreximbank’s strong capital position, high-quality collateral, and sound loan portfolio, the agencies routinely downgraded the bank’s overall rating because of what they described as Africa’s risky operating environment.
According to him, the institution effectively suffers a “double penalty”—first through the discounting of the value of African-based assets and then through additional notches applied solely because it operates in Africa.
He maintained that Africa’s loan default record did not justify such assumptions, insisting that the continent has demonstrated resilience and lower losses than often portrayed internationally.
The Afreximbank president stated that changing the narrative about Africa was as important as mobilising finance, stressing that distorted perceptions have for decades undermined confidence in the continent despite significant progress in infrastructure, industrialisation, and trade.
He maintained that journalism, like banking, should serve as an instrument for development by highlighting both Africa’s challenges and its successes, instead of reinforcing stereotypes centred on conflict, poverty, and instability.
Elombi described Nigeria as the “heartbeat” of Africa’s industrial transformation, citing the Dangote Refinery as evidence of how strategic investments can strengthen the continent’s economic resilience.
He revealed that Afreximbank recently committed $2.5 billion towards expanding the refinery’s capacity, saying the investment is driven not by the needs of the promoter but by Africa’s energy security.
According to him, the refinery proved its strategic value during the recent Middle East crisis by helping to stabilise petroleum supplies and supporting refined fuel exports beyond Nigeria, including to countries, such as Ethiopia.
He said Afreximbank planned to replicate similar refinery, storage, and pipeline infrastructure across East, Central and Southern Africa to reduce the continent’s dependence on imported petroleum products and improve energy security.
Elombi also defended the bank’s growing relevance, recalling that some international ratings agencies once questioned Afreximbank’s developmental mandate and dismissed trade finance as incapable of driving economic transformation.
He said those perceptions had changed substantially as the bank expanded its impact across the continent, pointing to its latest investment-grade assessment by Standard & Poor’s (S&P) and growing recognition of its strategic role in supporting African economies.
According to him, Afreximbank has become “too big to fail” because of its central role in financing trade, supporting governments during economic shocks and advancing the implementation of the African Continental Free Trade Area (AfCFTA).
Addressing concerns over the bank’s lending profile, Elombi disclosed that nearly 80 per cent of Afreximbank’s assets were deployed as loans across Africa, demonstrating its commitment to financing productive sectors rather than holding idle assets.
He explained that the institution carefully managed credit risks while maintaining a development-focused approach that prioritised businesses capable of transforming African economies.
Beyond financing trade, Elombi identified local processing of Africa’s vast mineral resources as the continent’s next major economic frontier.
He stated that exporting raw materials without processing them locally continued to deprive African countries of jobs, industrial growth, and higher export earnings.
He said the continent must deliberately build industries that would convert its mineral wealth into finished products before they leave African shores.
According to him, battery manufacturing represents one of the biggest opportunities currently reshaping global industrial competition, particularly with rising demand for electric vehicles and renewable energy technologies.
Citing his recent visit to China, Elombi said the global transition towards electric vehicles had created a once-in-a-generation opportunity for Africa to build battery manufacturing industries around its abundant critical minerals.
He said Afreximbank would prioritise financing investors prepared to process lithium and other strategic minerals within Africa rather than export them in raw form.
He said, “We are no longer interested in people who simply mine Africa and ship the minerals abroad.
“We want investors who will mine, process and export finished products from Africa.”
With the availability of funding, Elombi identified shortage of specialised technical skills as the continent’s biggest constraint, stating that battery manufacturing expertise remains scarce across Africa.
He said Africa’s development agenda would remain incomplete unless the continent controlled the institutions that shaped global perceptions of its economies, mobilised more of its own capital, and built industries that retained value within Africa, instead of exporting raw materials with little economic benefit.
He said, “We want to fund investors who will mine and process in Africa and now take out of Africa.”
On regional trade integration, Elombi described the Pan-African Payment and Settlement System (PAPSS) as one of Afreximbank’s biggest achievements, despite a slower-than-expected rollout.
He disclosed that 28 African central banks had now signed onto the platform, connecting more than 190 commercial banks and fintechs.
Although he said participation must expand considerably before the system could reach its full potential.
Elombi said the initial pace of adoption was slowed by resistance from some central banks, many of which feared PAPSS would encroach on their regulatory powers.
“We had to convince them that PAPSS is not replacing the central banks. It is simply part of the trade infrastructure Africa needs,” he said.
Elombi likened the payment platform to essential infrastructure, such as seaports, railways and pipelines, stating that Africa cannot build a truly integrated market under AfCFTA without an efficient cross-border payment system.
He highlighted the African Currency Marketplace, one of PAPSS’ flagship products, which enables businesses to exchange African currencies directly without first converting them into the US dollar or other foreign currencies.
Elombi cited practical examples, including arrangements that allowed companies, such as Dangote Group and Ethiopian Airlines, to swap local currency holdings across different markets, thereby reducing pressure on scarce foreign exchange and lowering transaction costs.
The Afreximbank president also revealed that the institution was preparing to launch the PAPSS Card, which will allow Africans to spend their domestic currencies across participating countries without first converting them into foreign currencies.
According to him, the card company has already been established and its management appointed ahead of commercial rollout.
While dismissing suggestions that cryptocurrencies posed a threat to PAPSS, Elombi said the platform could eventually coexist with stablecoins and other digital payment innovations, stressing that Africa would still require a trusted payment infrastructure as long as individual countries retain separate national currencies.
He added that Afreximbank continued to work with regulators to secure approvals for more commercial banks to join the network, expressing confidence that wider adoption would accelerate as governments and financial institutions increasingly appreciate its role in facilitating intra-African trade.
Elombi explained that PAPSS was first introduced as a pilot in West Africa because of the region’s relatively advanced monetary integration framework.
However, he acknowledged that some regions initially viewed the initiative with suspicion, slowing continental adoption before broader confidence began to build.
He said wider adoption of the platform would reduce dependence on foreign currencies in intra-African trade, lower transaction costs, and accelerate commercial activities across the continent.
The Afreximbank president expressed optimism that participation would continue to expand as more financial institutions and central banks recognised the benefits of a unified African payment infrastructure.
Elombi emphasised the need for Africans to redefine how the world viewed the continent.
He stressed that while the continent’s challenges should not be ignored, equal attention must be paid to the factories being built, new airports, refineries, hospitals and industrial projects that were steadily reshaping economies across the continent.
The Afreximbank president defended the bank’s funding strategy, revealing that Afreximbank has significantly reduced its dependence on Western capital markets by diversifying its funding sources across Africa, Asia, and the Middle East.
According to him, whereas about 80 per cent of the bank’s funding previously came from one region, Africa now accounts for about 38 per cent of its liquidity, Asia another 38 per cent, while roughly 12 per cent comes from the Middle East, leaving only about 12 per cent sourced from traditional Western markets.
He said the shift enabled the bank to access cheaper funding in currencies aligned with Africa’s growing trade with Asia while also mobilising idle African capital held abroad through a central bank deposit programme.
“Africa needs to raise its own money for Africa’s development,” he said.
Elombi also disclosed that the proposed African credit ratings agency is being driven by the African Union’s African Peer Review Mechanism (APRM), which will establish the institution before handing it over to private professionals for independent operation.
He stressed that African bankers, accountants and financial experts already possessed the technical competence required to run a globally credible ratings agency capable of assessing African economies within their proper context.
“Risk must be contextualised. Nobody understands African realities better than Africans themselves,” he said.
