The reality is much better than the perception: the writing of political risk and trade credit insurance in Sub-Saharan Africa

Although the African Trade Insurance Agency (ATI) has clear developmental objectives, the Agency’s approach is much more informed by a streetwise pragmatism rather than by the high minded idealism that characterised the work of so many United Nations sponsored international financial institutions in the past. One recent example of the Agency’s pragmatism was to sign up Sudan, which at the moment is in less than good standing with the World Bank Group, as an ATI Member State. Another was the decision to change the Agency’s capital and legal structures. As a direct result of this move, which significantly increased operational flexibility and underwriting capacity, the ATI was last month assigned an ‘A’ counterparty and insurer financial strength rating by Standard & Poor’s

It is all too easy to be pessimistic about economic development in Sub-Saharan Africa. For example, recent coverage of the region by the international financial press has tended to concentrate on the damage to its foreign direct investment prospects by the ethnic feuding, the widespread reports of electoral fraud and the political instability which characterised the elections in Kenya and Zimbabwe.