MANDISI NKUHLU The company enables export trade from South Africa to the rest of the world and also supports cross-border investments
An issue that has come into sharp focus for businesses in Africa is the shortage of available hard currency, as most capital projects on the continent tend to be funded in US dollars, although they may generate their revenue in local currency, says Export Credit Insurance Corporation of South Africa (ECIC) COO Mandisi Nkuhlu.
“Challenges on the continent are quite immense, owing to the backlog in infrastructure, as there is a limited pool of capital available from sources within the continent and an insufficient number of bankable projects. Owing to this, you would need foreign direct investment and risk capital to help with additional capital to accelerate the development of the continent, whether it is with infrastructure projects or innovative technology investments,” he points out.
ECIC has high exposure to the countries within the Southern African Development Community and plans to increase its footprint in West and East Africa.
“We have in-house research teams that assess countries and regional dynamics to identify trade and investment opportunities for South African companies. We publish this research and it is available on our website,” Nkuhlu says.
Nkuhlu explains that, in this manner, the ECIC shares information with the domestic players in the South African market, creating awareness among them about which countries and sectors the company is willing to underwrite political and commercial risk.
The ECIC’s insurance is dedicated to support export trade and, on the continent, supports projects and transactions that source at least 50% of the required goods or services from South Africa. Through its insurance products, and collaboration with financiers and exporters, the company enables export trade from South Africa to the rest of the world. It also supports cross-border investments, with a strong focus on the African continent.
The company’s end goal is to assist businesses by helping them expand into markets outside South Africa. This will ensure a wider footprint and bigger market for them, which will positively impact on the South African economy in terms of hard currency earnings flowing back into the economy, increasing the order book for companies based in South Africa and integrating them into global supply value chains, he explains.
“This also enables higher levels of manufacturing and job creation which benefits the domestic economy,” concludes Nkuhlu.