African Trade Insurance Agency (ATI), a leading trade credit and investment insurer in Africa is confident that Rwanda’s insurance market will expand due to an increase in political risk insurance and trade credit insurance, boosting the country’s strategy to become a middle income economy by 2020.
On its side, ATI expects its business operations in Rwanda to hit a record value of $408 million in by covering Foreign Direct Investments (FDI) this year.
“In under a decade, Rwanda has evolved into a Mecca for business. This phenomenon is reflected in the number of enquiries ATI receives from investors interested in Rwanda and from Rwandan businesses seeking insurance to help them expand safely into the EAC market,” Stewart Kinloch, the Chief Underwriting Officer at ATI said.
He was speaking at an insurance workshop in Kigali, yesterday, where he revealed that ATI closed its first deals in Rwanda to provide insurance cover on two projects in construction and manufacturing with a collective value of $76 million.
One of the insurance covers is sought to have been provided on Cimerwa’s cement factory expansion. The other went to unnamed services industry project.
“A lot of interest in Rwanda comes from manufacturing, energy investments with regards to power, hotels and we also saw a request from aviation,” Kinloch said during a sideline interview with Business Times.
He said that some of the projects they insured will never get off to ground while others are still evolving.
Founded by African member states in 2001, at the initiative of COMESA to help attract more FDI to Africa, ATI offers political risk insurance to protect investors and lenders from any government actions or politically motivated violence that could negatively impact their business interests. It also offers trade credit insurance, which covers commercial non-payment and payment default risks of clients who include exporters, importers, manufacturers and banks.
The workshop was designed to increase knowledge and awareness about investment and trade credit insurance among bankers, insurance brokers and the media.