Ethiopia’s commercial lender Zemen Bank has secured $85 million in trade finance facilities from Afreximbank and the Trade and Development Bank (TDB) to strengthen its capacity to process import and export transactions.
According to local media reports published on Tuesday, the funding will allow Zemen to issue more letters of credit, guarantees, and collections, helping clients navigate Ethiopia’s foreign-currency-constrained market.
The arrangement builds on a $30 million trade guarantee the privately owned bank received from the International Finance Corporation in 2024.
The bank, which operates over 117 branches and serves corporates, SMEs, foreign investors, and embassies, said the new agreements form part of its ongoing engagement with development finance partners. By boosting trade finance capacity, Zemen aims to reduce transaction delays, improve liquidity for businesses, and support smoother cross-border trade operations.
Afreximbank’s $40 billion trade commitment
The deal comes just after Afreximbank reaffirmed its pledge to scale intra-African trade, industrialisation, and value-chain development under the African Continental Free Trade Area (AfCFTA).
The pan-African lender has committed to doubling its trade financing from $20 billion between 2017–2021 to $40 billion by 2026.
“Afreximbank designed a range of financing and trade facilitation instruments to support intra-African trade and the AfCFTA,” said Gainmore Zanamwe, Director of Trade Facilitation and Investment Promotion at Afreximbank during a conference held in Abuja, Nigeria on Monday.
The expanded trade facility with Zemen is part of a broader continental push, which also includes the AfCFTA Adjustment Fund, a $1 billion initiative established jointly with the AfCFTA Secretariat to support countries adjusting to the single market.
Of this, $100 million is allocated to a Credit Fund for commercial projects and $10 million to a Base Fund for policy reform support. Zanamwe noted that the Credit Fund is fully operational, with $10 million already disbursed to projects.
What it means for Ethiopia’s trade ecosystem
By tapping Afreximbank and TDB resources, Zemen is positioned to play a pivotal role in Ethiopia’s trade ecosystem, providing vital liquidity to businesses reliant on letters of credit and guarantees.
Analysts say such arrangements can help ease foreign-currency constraints, reduce delays in cross-border transactions, and create more predictable conditions for exporters and importers.
The facility also signals how local banks can act as intermediaries for continental finance initiatives, translating large-scale AfCFTA commitments into tangible support for SMEs and corporates.
As Ethiopia’s trade sector navigates currency and liquidity challenges, Zemen’s strengthened capacity underscores the critical role of development finance partnerships in enabling intra-African trade growth.
