After financing phase one in 2019, Deutsche Bank announce today the closing of a new lending facility to finance phase two of the Kumasi Market redevelopment project in the Republic of Ghana, together with the UK Export Finance Agency (UKEF) and African Export-Import Bank (Afreximbank).
The 184 million euro financing consists of a 145 million euro loan supported by UKEF and a 39 million euro commercial loan by Afreximbank. Deutsche Bank acted as the sole structuring bank and mandated lead arranger for the two loans.
The Kumasi Market is the largest market in West Africa. It not only serves the Kumasi region, but also acts as a magnet for traders from neighbouring countries such as Benin and Togo. Before its redevelopment, it comprised of more than 12,000 stores and stalls, with footfall of around half a million people each day. However, regular fire outbreaks resulted in the destruction of stalls and loss of livelihoods prompting its redevelopment.
The overall construction was awarded to Contracta Construction UK Limited and has been split into three phases to minimise disruption in the Kumasi business district and ensure the market continues operating at all times.
Commenting on the transaction, Alarik d’Ornhjelm, Head of Structured Trade & Export Finance for Middle East and Africa at Deutsche Bank, said: “We are pleased to be again involved in the redevelopment of this iconic marketplace. This further development of the market will boost economic activities and provide social benefits to the local community.”
Harriet Thompson, British High Commissioner to Ghana, said: “When I visited Kejetia Market last year, I met the stall owners and market traders, many of whom are women, working in the newly completed phase one of the market, I heard first-hand the positive impact the development has had on their businesses, their families and the community within the market, which spans generations. This positive impact is thanks to the partnership between the UKEF, Ghana and Deutsche Bank which has and continues to support the growth of Kumasi’s trading centre through the development of the region’s largest market. I look forward to visiting the market again to see the second phase progress.”
As the transaction plays a key role in assisting the socioeconomic advancement of a number of local small and medium enterprises in the overall supply chain, it will contribute towards Deutsche Bank’s target of facilitating over 200 billion euros in sustainable finance and investments by 2023.
Since 2011, Deutsche Bank has arranged over 3 billion euro of financing across over 20 transactions to support critical infrastructure development in Ghana most of which are social loans supported by Export Credit Agencies (ECAs). In July 2021, the bank announced the closure of two social loans with the Republic of Ghana to fund four health and two transportation projects. The bank also announced signing an approximate 600 million euro agreement to finance the construction of a 100km stretch of Ghana’s Western Railway Line, running from Takoradi Port to Huni Valley.