The government has approved the resolution ratifying Mozambique’s accession to the African Trade Insurance Agency, a decision taken last week at the 20th ordinary session of the Council of Ministers.
Among other matters, the government in the same cabinet session assessed the terms of reference for the realization of FACIM 2023, scheduled for August 28 to September 3, 2023.
The African Trade Insurance Agency
The African Trade Insurance Agency (ATI) was established in 2000. The initial group of participating countries was: Burundi, Malawi, Rwanda, Kenya, Tanzania, Uganda and Zambia. Both country and corporate membership has since increased to 21 and 12 respectively.
The main objective of the ATI is to provide political risk cover to companies, investors, and lenders interested in doing business in Africa. Membership to the ATI is open to all African Union Member States. The agency is supported by the World Bank, which provides low interest loans to participating Member States.
The most important benefit of a regional insurance scheme is its potential to deal with the perception of high levels of risk in doing business in Africa as a region. Many financial institutions and business enterprises associate political risk to the region as a whole and never get to the stage of attempting to distinguish different levels of political risk between individual countries. This perception of high regional political risk deters financial institutions and business enterprises from establishing a presence in the region.
ATI’s current range of insurance products includes:
- Trade Political Risk Insurance
- Comprehensive Trade Political Risk
- Foreign Direct Investment Insurance
- Project Loan Cover
- Mobile Assets Cover
- Unfair Calling of Bonds and Standby Letters of Credit
- Credit Insurance Cover