The African Trade Insurance Agency

African Trade Insurance Agency, is a trade and political risk insurer with operations in 16 African countries. The political cover ATI provides is proving popular due to the high risk perception that Africa attracts. The products are becoming especially popular among foreign investors who are positioning themselves to take advantage of the growing business opportunities in the continent.

ATI is a multilateral financial institution that provides export credit insurance, political risk insurance, investment insurance and other financial products to help reduce the business risks and costs of doing business in Africa. The Agency also facilitates foreign direct investment into Africa and trade flows within the continent.  

ATI was launched in 2001 and in less than a decade, they have supported over $1.2 billion worth of trade and investments across the continent, and secured an investment grade rating of ‘A’ from Standard & Poor’s.  They have also expanded membership to more than a dozen African countries with plans to attract non-African member states by 2011.  They also have thriving and plans to expand operations into Ghana, Benin, Gabon, Cote d’Ivoire and Cameroon, which is expected to open up the West African market by providing a trade linkage between east and west Africa.

ATI was created to fill a market gap in trade and investment risk mitigation in Africa. In the late 90's, risk mitigation tools for credit and political insurance were not available for many African countries, and where the cover existed, it was very costly. In addition, the relatively small volumes of trade and investments into these countries did not justify the establishment of national export credit agencies. The only viable solution was to form a multilateral agency that would provide more cost-effective use of underwriting capital, reduced over-head costs and the ability to encourage private sector insurers to assume risk in Africa. The investments covered cut across various sectors such as agribusiness, energy, housing and manufacturing.

The ATI Member States include: Burundi, Democratic Republic of Congo, Djibouti*, Eritrea*, Ghana* Kenya, Liberia*, Madagascar, Malawi, Rwanda, Sudan*, Tanzania, Uganda and Zambia. *Pending signature and/or ratification.

Some ATI insurance products include coverage against:

Expropriation

Coverage against confiscation, expropriation, nationalisation and other illegitimate actions of foreign governments which may deprive you of your rights of ownership or control of your assets without appropriate compensation in a freely convertible currency.

Transfer Restriction

Coverage against the inability to both convert local currency into convertible currency and to transfer convertible currency out of the country. Currency inconvertibility and transfer risk policies apply to losses resulting from financial crises, convertible currency shortages or arbitrary political decisions by a government. 

War, Civil Disturbance or Civil Commotion 

Coverage against destruction, disappearance or physical damage to tangible assets caused by politically motivated acts of war or civil disturbance including revolution, insurrection and coups d'etat.

Embargo

Covers against financial loss due to trade embargoes or any other sanction imposed by the Security Council of the United Nations, or by any country or group of countries against the host country.