The African Export-Import Bank (Afreximbank) recently announced that it will inject $6.5 billion into its capital in order to expand its capacity to provide development services to Africa's recently pandemic-stricken economies.

"This is a historic moment for the Bank; it represents a great opportunity to deepen the Bank's ability to deliver transformative growth across this continent," said Benedict Oramah, President of Afreximbank, quoted in the bank's statement.

The document states that this General Capital Increase (GCI) will expand the bank's ability to purchase Covid-19 vaccines for the continent.

Afreximbank aims to create greater capacity for African nations to deal with the bumps of the pandemic through support in programs and provision of vaccines, but also wants to boost the implementation of the African Continental Free Trade Agreement (AfCFTA).  

The bank says that the decision was taken at the 28th annual meeting in July 2021, and that African countries, the bank's shareholders, will contribute up to $1.5 billion in capital, and an additional $3.9 billion to be made available in case of need.

The bank's Board of Directors opened the ICG to other shareholders of the bank to contribute up to $1.1 million to allow them to participate to the extent of their shares in Afreximbank.

"Afreximbank expects to double its annual lending capacity over the next five years, contributing to the reduction of the annual trade finance deficit in Africa," the note advances.

Afreximbank is a multilateral financial institution mandated to finance and promote trade between African countries.