ATI & Ministry of Trade announce positive signals for Kenyan trade and investments amidst global recession
NAIROBI, 14 May, 2009
Fresh from the launch of its first regional office in Kampala last week and ahead of its Annual General Meeting next week, the Nairobi-based African Trade Insurance Agency (ATI) and the Ministry of Trade will deliver remarks expected to give a boost to Kenyan business and trade at a joint press conference on Monday18 May at the Intercontinental Hotel. The press conference will feature ATI's CEO, Peter Jones and Ministry of Trade's Permanent Secretary, Dr. (Eng.) Cyrus Njiru.
ATI uses a flexible mix of political risk, credit risk and export credit insurance products to mitigate risks against such situations as a buyer who fails to pay for goods received from a Kenyan exporter, or adverse impacts of foreign currency fluctuations on a company's receivables. To prove its flexibility, in 2008, ATI launched a groundbreaking product together with local Kenyan insurers that protects individual property against the risk of political violence, civil disturbance, terrorism & sabotage.
Since writing its first policy in Kenya less than a decade ago, ATI has written policies with a transaction value of more than US$865 million. Specifically, the Agency continues to provide protection to some of the country's most important export sectors including agribusiness, where the total transaction value of ATI's policies have been over US$115.5 million, energy, with transaction values worth some US$ 98 million, and over US$74 million in the telecommunication/ICT sector.
"The global recession provides a rare opportunity for Kenya and for Africa to develop the necessary infrastructure that will help us create demand within our own markets. ATI has developed innovative insurance products that are now proving their ability to protect our trade and investments, against external shocks," noted Dr. Cyrus Njiru, Permanent Secretary for Trade.
For Kenyan companies like HighChem, a distributor of industrial chemicals supplying to buyers in Uganda and across East and Southern Africa, ATI insurance coverage has given peace of mind and security against non- payment from their buyers.
"We obtained credit risk insurance from ATI a couple of years ago just as we were exporting to more markets," explained High Chem Director, John Griffin "In retrospect, our insurance purchase was timely. What we couldn't have predicted then were two major incidents that would happen within months of each other - the political violence in Kenya and the global financial crisis - both of which could have impacted our buyers' ability to pay us. ATI's credit assessment process is very much complementary to our own."
Since the global recession began last year, ATI has seen demand for its products and services across Africa more than double in some categories. ATI hopes to leverage its reputation and strong financial standing as the Agency was assigned a long term 'A' rating by Standard & Poor's last year, committing it to structure the best deals possible for Kenyan and for African companies.
Peter Jones, ATI's CEO added, "we expect our volume of business to increase substantially this year to well above the US$769 million worth of policies we issued last year. In fact, we predict that the current increase in demand for our products may well signal an upturn in trade and investments across Africa."
Headquartered in Nairobi, Kenya, the African Trade Insurance Agency (ATI) is an African owned International Financial Institution. Founded in 2001 by African States with the financial and technical support of The World Bank Group, ATI provides a range of customised, innovative and competitively priced Credit and Political Risk Insurance Products to support African investments and trade. Since writing its first policy in 2003, ATI has supported US$1.2 billion in trade and investments across Africa. In 2008, ATI issued insurance policies covering political and commercial risks for transactions worth US$769 million. The Agency also supported exports worth US$95 million from its African Member States. The sectors supported include; telecommunications, manufacturing, agribusiness, education, export, services, hotels, mining and residential housing. Beneficiaries include manufacturers/exporters of goods/services located in Member States, regional and international banks who are providing financial support to regional businesses, investors investing in the region, and the overall business community in ATI's Member States.
ATI offers Political Risk Insurance for Trade & Investment, Political Violence, Terrorism & Sabotage Cover, Comprehensive Non-payment Cover, Inter & Intra-Regional and Domestic Whole Turnover Credit Insurance, Project Loan Cover, Unfair Calling of Bonds Insurance and Mobile Assets Insurance.
The Agency's paid in capital is US$86 million, with US$54 million in additional committed capital.
Awarded a Stable Long Term 'A Stable' rating for Financial Strength and Counterparty Credit by Standard & Poor's in 2008, ATI is on track to continue providing effective cover to Africa.