Ghana International Bank (GHIB) is urging bold reforms in Africa’s trade finance systems to address one of the continent’s most pressing economic challenges—the persistent trade finance gap.

The bank’s Chief Executive Officer, Mr. Dean Adansi, emphasized that reforming trade finance is not just about easing transactions, but also about creating the foundations for stronger domestic capital markets.

Mr. Adansi argued that Africa’s current export model is leaving billions of dollars in potential earnings untapped. With the continent’s share of global trade stuck below three percent, the reliance on raw commodity exports has limited Africa’s ability to capture more value from its natural resources.

“Interest rates are significantly higher than in the West in many African countries, making it very difficult for smaller entities with short-track records to obtain the financing they need to export commodities, or even to industrialise locally.”
Mr. Dean Adansi

He further explained that this structural disadvantage hampers Africa’s ability to invest in local processing industries, which could multiply export earnings, create jobs, and boost domestic savings.

According to GHIB’s analysis, sub-Saharan Africa faces an estimated US$80 billion trade finance gap. Mr. Adansi stressed that for every US$1 of trade, there is a US$1.70 impact on GDP. Closing this gap could therefore unlock an additional US$133 billion annually for African economies. “The consequences are significant; in jobs, in revenues, and in building the local savings needed to strengthen domestic capital markets,” he said.

Without access to adequate financing, many African businesses remain trapped in a cycle of exporting raw materials while foreign markets reap the benefits of value addition.

GHIB’s Role in Bridging the Gap

For more than 65 years, Ghana International Bank has operated from London, serving as a bridge between African markets and the international financial system. Over the last five years, GHIB has facilitated over US$14 billion in trade flows, including US$10.6 billion in documentary trade collections and US$2.7 billion in primary trade finance transactions across sub-Saharan Africa.

In 2024 alone, downstream payments to West Africa exceeded US$8.5 billion, highlighting the scale of GHIB’s involvement in sustaining African trade. Mr. Adansi said the bank continues to work closely with local financial institutions to build their capacity, making them more attractive to larger international lenders.

Despite these achievements, GHIB recognizes that financing for processing industries remains the biggest bottleneck to Africa’s economic transformation. Processing plants require significant upfront capital, long repayment periods, and tailored risk assessments—needs that traditional banking products often fail to meet. “Traditional banking products are rarely designed to support multi-year investment cycles in processing,” Mr. Adansi explained.

This mismatch in financial products leaves African processors unable to compete globally, perpetuating the cycle of dependency on raw exports.

Strengthening Domestic Capital Markets

Beyond supporting trade transactions, Mr. Adansi emphasized that reforming trade finance is a pathway to strengthening domestic capital markets. By enabling more local businesses to access financing, countries can build up domestic savings, which in turn feeds into stronger local financial systems.

A robust domestic capital market would reduce Africa’s dependence on foreign debt, lower financing costs, and provide sustainable long-term funding for both trade and industrialization.

GHIB’s approach is to create a sustainable cycle in which local banks, once strengthened, can support small and medium-sized enterprises (SMEs) and exporters. This, Mr. Adansi argued, will set off a multiplier effect across African economies—boosting trade, industrialization, and employment.

The blueprint GHIB is pursuing goes beyond immediate financing solutions. It focuses on aligning trade finance with Africa’s industrialization agenda, ensuring that the continent not only participates in global trade but does so on more competitive and profitable terms.