The African Trade & Investment Development Insurance (ATIDI) has backed a landmark financing deal that reinforces its role in advancing sustainable economic growth across the continent. The institution is providing a second-loss guarantee for a EUR 507.5 million loan from Deutsche Bank to the Republic of Benin, a deal designed to improve the country’s financial stability while supporting its sustainable development ambitions.
This strategic initiative, centered around innovative loan insurance for African sovereign debt, marks a pivotal moment for Benin’s public finance strategy. The senior unsecured amortizing term loan, arranged solely by Deutsche Bank, is bolstered by a first-loss guarantee of up to EUR 200 million from the International Development Association (IDA), a branch of the World Bank Group. Complementing this, ATIDI’s second-loss guarantee covers the remaining principal and interest, a structure that reduces financial risk for investors and lowers borrowing costs for Benin.
“This landmark financing demonstrates the power of strategic partnerships in unlocking sustainable investment for African economies. Our collaboration with Deutsche Bank in supporting the Republic of Benin highlights ATIDI’s essential role in facilitating innovative financial solutions that enhance fiscal resilience. By providing a second-loss guarantee, we help ensure that Benin secures long-term, cost-effective financing, reinforcing its economic stability while channelling resources toward its sustainable development goals.”
Manuel Moses, CEO of ATIDI
This move represents ATIDI’s latest step in providing tailored risk-mitigation solutions that empower African nations to access long-term financing under favorable conditions. Notably, this is the first IDA-backed guarantee structured under the World Bank’s new guarantee platform, which was launched in July 2024, signaling a new chapter in international development finance on the continent.
The deal allows Benin to restructure and extend the maturity of its public debt obligations, creating much-needed fiscal space. This financial breathing room will enable the government to align its debt management strategy with key priorities outlined in its Sustainable Development Goals (SDG) Framework. Resources previously allocated to near-term debt servicing will now be redirected to priority social and economic programs.
Boost For Development-Focused Public Spending
The added insurance protection from ATIDI and the IDA not only enhances investor confidence but also ensures that Benin can continue to secure competitive financing in global markets. The structure of the transaction reflects a growing recognition that blended finance — combining public guarantees with private capital — can play a powerful role in stabilizing and growing African economies.
Maryam Khosrowshahi, Managing Director at Deutsche Bank, emphasized the significance of the transaction.
“We are proud to have acted as sole mandated lead arranger and sole lender to the Republic of Benin on this novel transaction with IDA and ATIDI. We leveraged our successful financing track-record with the Republic of Benin as well as our excellent relationship with the Republic’s advisor Rothschild & Co, and extensive transaction experience with the World Bank Group and ATIDI to deliver this critical financing in an effective and timely manner.
“Timing was indeed of the essence as the Facility was signed on 8 January 2025 concurrently to the announcement of a tender offer targeting up to EUR 250 million of Benin’s EUR2032s notes and of a new USD 500 million bond issue to complement the country’s 2025 budgetary needs.”
Maryam Khosrowshahi, Managing Director at Deutsche Bank
The EUR 507.5 million loan was finalized in tandem with Benin’s return to global capital markets via a USD 500 million bond issuance. A portion of the proceeds is being used to refinance existing debt, including a targeted buyback of the EUR 2032 bond. The strategy is designed to optimize the country’s debt portfolio by extending maturities and reducing the immediate debt service burden.
As Benin repositions itself on the international financial stage, ATIDI’s role has proven vital. Its participation sends a strong signal to global markets that risk-mitigated investment in Africa is not only possible but can be profitable and impactful. Through this and similar efforts, ATIDI continues to deliver on its mandate to de-risk African economies and promote long-term investment, partnering with institutions like Deutsche Bank and the World Bank Group to advance financial innovation and sustainable development.
READ ALSO: Alleged Drug Trafficking at KIA: President’s Response Timely – Security Consultant
