CDC Group, the UK’s development finance institution and impact investor, has committed an additional $100m commitment to its existing master risk participation agreement with Standard Chartered.

The increase in commitment will provide Standard Chartered with systemic liquidity to directly support trade lines to local banks across South Asia and sub-Saharan Africa.

Admir Imami, Director, Head of Trade & Supply Chain Finance, CDC, said: “We continue to ramp up our trade finance programme as part of CDC’s “Strengthen” pillar response to COVID-19. Our partnership with Standard Chartered Bank will support vital trade and supply chains in sub-Saharan Africa and South Asia, thereby protecting jobs and economic growth. Our trade finance programme aims to alleviate poverty, and ensure vital goods get to those that need it most across our markets.”

This new commitment comes at a particularly challenging time as the COVID-19 pandemic has created severe liquidity pressures for banks and businesses across Africa and South Asia, exacerbating the existing pressure on trade finance availability as international banks limit their risk appetite.

In this context, development finance institution capital becomes even more critical to maintain trade flows and support economic growth.

The capital will be channelled into some of Africa’s most fragile countries and will address major challenges in the food & agriculture and healthcare sectors as they benefit from preferential terms.

This deepening partnership between CDC and Standard Chartered demonstrates the need to channel more trade finance towards vulnerable countries most affected by the impacts of the crisis, as well as support sectors that are critical to serving people’s basic needs.

The new commitment further strengthens CDC’s long standing relationship with Standard Chartered, marking a key milestone in the partnership, and contributes to two of the United Nations’ Sustainable Development Goals: Zero Hunger (SDG 2) and Decent Work and Economic Growth (SDG 8).

Nicolas Langlois, Global Head, Trade Distribution, Standard Chartered, said: “We are delighted to partner with CDC on this initiative, which will enable us to support business sectors across sub-Saharan Africa and South Asia that are impacted by COVID-19, as well as provide them with the much-needed access to trade finance in these challenging times. This is not only testament to our commitment to be there for good for our clients and the community, but more importantly, to continue to play a role in facilitating trade flows for businesses that are the life-blood of their local economies.”

James Duddridge, FCDO Minister for Economic Development, said: “As we work to support global economic recovery from Covid-19, this additional $100m through the CDC and Standard Chartered partnership will be critical for many businesses in sub-Saharan Africa and South Asia. This investment will help protect jobs, support economic growth and ensure vital goods get to those most in need.”

Since 2015, CDC has guaranteed $3.3bn, resulting in $12.5bn of trade across its markets of Africa and South Asia.