ATI Announces Profits for 9th Consecutive Year as it Marks 20 Years of supporting Trade and Investment in Africa

The African Trade Insurance Agency (ATI) has shown great resilience and posted a net profit growth of 43% and a Gross Exposure of USD 6.3 billion amidst the COVID-19 Global Pandemic.

ATI is also increasing its capital base and footprint across the African continent through support from the African Development Bank (AfDB), the European Investment Bank (EIB) and the German Development Bank (KfW).

As it marks its 20th Anniversary, the Nairobi based Pan-African insurer has pledged a more robust, reliable and transformational strategic approach to its business offerings.

This was announced recently at its 21st Annual General Meeting (AGM) held virtually to present its record results for the 9th consecutive year for financial year 2020, which was marked with turbulence and uncertainty due to Covid-19 global pandemic.

As it marked its 20th Anniversary, ATI reaffirmed its role in the economic transformation in Africa, ensuring effective trade and investment, making the continent more resilient post Covid.

ATI has navigated the initial impacts of the Covid-19 crisis, managing both short and medium term effects of the pandemic on its balance sheet. It closed the year with a Net Profit of USD 39.4 million and a Gross Exposure of USD 6.3 billion.

The AGM also approved the proposed dividend distribution of USD 9.9 million, an annual growth rate of 139% from 2019. This growth reflects ATI’s resilience and the Board’s confidence in the underlying strength of the business.

Amongst the key highlights of the 21st AGM were also the following: A record Net Profit of USD 39.4 million, representing a 43% increase between 2019 and 2020; a record Gross Exposure of USD 6.3 billion, representing only a minor decrease of 3% between 2019 and 2020; a record Gross Written Premium of USD 125.6 million, representing a 12% increase between 2019 and 2020.

Others performance highlights are a Return on Capital of 12.6% despite 18% growth in Equity; three new shareholders joined (Niger, Togo and CESCE); and maintained its A/stable rating by Standard & Poor’s and A3/Stable rating by Moody’s.

As ATI strives to be fully Pan-African, its membership base continues to grow, underpinned by its increased relevance and support from the African Development Bank (AfDB), the European Investment Bank (EIB) and the German Development Bank (KfW).

Angola, Burkina Faso, Cameroon, Chad, Egypt, Gabon, Mali and Senegal are at an advanced stage of finalizing membership, while additional funding has been secured for capital increase for some existing members.

With the growth of membership comes other advantages such as increase in ATI’s equity and investment earnings, as well as upgrading its credit rating of A/Stable by both Moody’s and Standard & Poor’s.

The outgoing Chairman of the AGM, Honorable Matia Kasaija, Uganda’s Minister of Finance, Planning and Economic Development noted “ATI has worked with Ministries of Finance to help manage growing debt levels by re-profiling costlier and riskier debts and replacing them with longer term, affordable debts from top rated international commercial lenders. This has not only resulted in improvements in institutional framework for debt liability management, but also brought significant cost savings and lowered debt ratios. This is in addition to the support offered to commercial entities that facilitate private sector development in ATI member countries.”

The CEO, Mr. Manuel Moses, commented “I am extremely proud of the twenty-year track record that ATI has set in the provision of Credit and Political Risk Insurance to support Trade and Investments in Africa. While we embark on our third decade, ATI pledges a more robust, reliable and transformational strategic approach to its business offerings. We continue to be the de-facto business risk mitigation tool that propels intra Africa trade in support of AfCFTA.”

The AGM bureau confirmed Hon. Kenneth Ofori-Atta, Minister of Finance and Economic Planning of the Republic of Ghana as the incoming Chairperson of the General Meeting. H.E. Dr. Uzziel Ndagijimana, Minister of Finance and Economic Planning of the Republic of Rwanda was confirmed as Vice Chairperson.

Republic of Senegal signs ATI’s Participation Agreement

The Republic of Senegal and the African Trade Insurance Agency (ATI) have recently concluded and signed a Participation Agreement in fulfilment of the Government of Senegal’s final Membership requirements to join ATI.

The participation agreement will be tailed by payment of capital of EUR15 million, bankrolled by the European Investment Bank (EIB) for Senegal’s Membership in ATI after the successful signing of a financing agreement between Senegal and EIB in October 2020.

Membership in ATI will enable Senegal to attract competitively priced and longer-term financing. ATI’s investment-grade rating successfully mitigates investment risks and crowd-in investment insurance capacity to cover large borrowing volumes ensuring that Senegal is able to meet the terms of international lenders and investors.

ATI is increasingly seen as a strategic development partner to African governments, insuring between 1 – 2% of the annual GDP of its member states as well as participating in some of the continent’s largest strategic development projects with the view of boosting investment and intra-African trade in support of the Continental Free Trade Area (AfCFTA).

Senegal’s membership in ATI is aligned to the country’s strategic plan (2019–2023) which aims to contribute to the achievement of the Government’s national socio-economic development strategy. In addition, local private and public sectors will also benefit through provision of innovative insurance solutions to support trade and investments and will also enhance Senegal’s access to Foreign Direct Investment (FDI) for the country’s economic growth.

ATI’s current exposure in Senegal stands at USD21 million given the Institution’s pan-African mandate permitting the multilateral insurer to support strategic deals in non-members states. This gross exposure is set to increase over the next few years given the business pipeline in Senegal has enquiries worth over USD4 billion – mainly covering the Financial, Energy and Infrastructure sectors.

Following the ratification and signature of the ATI Treaty in March 2020 by the President of Senegal, H.E Macky Sall, the ATI treaty grants the institution a preferred creditor status in Senegal, recognizing ATI’s role as insurer of last resort and thus the need to reimburse ATI for any claims and recoveries made as a result of sovereign obligations or defaults. The Governments of Angola, Burkina Faso,
Cameroon, Egypt and Chad are also expected to join ATI’s membership in the coming months as they strive to finalize their various membership requirements.

S.E.M. Amadou HOTT, Minister of Economy, Planning and Cooperation, Sénégal said “The guarantee facilities and services offered by ATI are useful for our country. They can be used as a development catalyst to boost our economic growth in line with our current priorities as stated in the PAP 2A of the PSE. Therefore, with Senegal’s option to make private investment and Public-Private Partnerships (PPP) one of the key components of the PAP 2A of the PSE, ATI will act as a reliable interface between the public and private sectors for solid and mutually beneficial partnerships for our country.”

According to Manuel MOSES, CEO of ATI “The Republic of Senegal is well underway in being ATI’s 19th member state. We welcome the country’s commitment in enhancing inclusive economic growth which will without doubt pave way for a more sustainable growth and development in Senegal. ATI is committed to deepen our support for Senegal especially during the COVID-19 pandemic, as the country stands to benefit from risk mitigation and credit enhancement services offered by ATI to expand FDIs and trade flows in Senegal.

ATI is a pan-African institution that provides political risk insurance to companies, investors, and lenders interested in doing business in Africa. With deep roots in Africa, we are best positioned to understand and assess the risks here – and to help mitigate them. As a result, we offer robust risk solutions to our clients. Our financial partners have come to rely on our assessments because of our credibility, financial strength, and underwriting capacity.

Nigeria is member of ATI. President Muhamnadu Buhari has in August 2020 finalized the country’s membership by signing the membership agreement.