Projects - African Trade Insurance

ATI is helping grow Africa sector by sector and project by project with lasting impact.

ATI supports the goals of its member countries by providing insurance support for their priority sectors. From a USD110 million pre-export facility for the extraction of copper cathodes in the Democratic Republic of Congo to a USD255 million syndicated loan to secure outstanding contract obligations to Independent Power Producers in Tanzania, ATI is becoming a market leader in providing solutions that show real impact in our member countries.

Below is a sample of our projects:


Project:Production of biomass wood productsCountry: DRCInsurance Types: Political Risk InsuranceRisks Covered: Equity insurance,Expropriation,Fixed divesture,Selective discrimination

The use of charcoal, especially in Africa, has raised concern among environmentalists and those responsible for forest development. In 2000, nearly 470 million tons of wood was consumed in homes in sub-Saharan Africa in the form of charcoal, more wood per capita than any other region in the world. With ATI’s support, a European firm will harvest an environmentally friendly fuel substitute, hevea, which will be processed into briquettes, pellets or chips, and used as a substitute for charcoal. The company also plans to replant bamboo in order to increase forest cover – a move that will assist the DRC government with its clean development policy.

Maximum Sum Insured: USD 6.6 million

Project:Supply of irrigation equipmentCountry: TanzaniaInsurance Types: Comprehensive Risk InsuranceRisks Covered: All political & commercial risks

Tanzania produces and exports sugar, an important commodity. When a centrally-located plantation wanted to install an irrigation system, they turned to two renowned Italian suppliers. SACE, the Italian Export Credit Agency insured the transactions together with its trusted African reinsurance partner, ATI.

Maximum Sum Insured: USD 5.6 million

Project:HousingInsurance Types: Political Risk InsuranceRisks Covered: Civil disturbance or civil commotion; and embargo,Transfer restriction; expropriation; war

An African-based housing construction company required insurance to cover an investment from a European financial institution. This project supported by the Ministry of Urban Development and Housing, increases the housing capacity in Kinshasa with a three block housing complex that will service dozens of families.

Maximum Sum Insured: USD 1.8 million

Project:Construction of structural steel, buildings, reinforced concrete, associated earthworks and civil steelCountry: TanzaniaInsurance Types: Single Obligor Trade Credit InsuranceRisks Covered: Insolvency and protracted default

ATI insured a private civil and building construction company against non-payment by one of the main sugar companies in Tanzania.  The project aims at expanding the sugar cane production in the country, which is expected to grow by 3.39% in 2013 and create new jobs for the locals.

Maximum Sum Insured: USD 1.5 million

Project:Rehabilitation of Water and Electricity InfrastructureCountry: BurundiInsurance Types: Political Risk InsuranceRisks Covered: Contract Frustration and Unfair Calling of Bonds

Demand for electricity in Burundi outstrips supply, a situation attributed to frequent power failures and insufficient power generation. The situation is made worse by an inefficient power distribution system and the heavy dependence on electricity to distribute water throughout the country.

ATI supported a European contractor on a project to rehabilitate high voltage posts, and to modernize and extend electrical protection, communications and control systems. This is part of an ongoing infrastructure upgrade project in the peri-urban areas of Bujumbura.

Maximum Sum Insured: USD 17 million

Project:Petroleum importationInsurance Types: Political Risk InsuranceRisks Covered: Currency transfer restriction and inconvertibility

The government of Malawi created a new state-owned company to more efficiently respond to the urgent demands from its citizens for petroleum. To support this company in its efforts to import adequate supplies of petroleum, ATI provided an insurance policy against currency transfer restriction to PTA Bank the financier. The project is expected to support the government in its quest to meet demand and to quell the public’s concerns.

Maximum Sum Insured: USD 40 million

Project:Road ReconstructionInsurance Types: Non-payment by a sovereign obligor (a government buyer)Risks Covered: Political Risk Insurance

This project, the reconstruction of a road connecting rural regions to Kenya’s capital Nairobi, provides two noteworthy benefits: First, it resonates with the state’s objective of supporting domestic Small and Medium sized companies through the award of government contracts. Second, the road will give farmers easy and speedy access to key markets within the city by facilitating movement of produce from the farms. With recent studies indicating that over 70% of African farmers’ losses occur post-harvest, a reliable road system goes a long way to enhance the productivity of the agricultural sector on the continent. ATI supported the contractor by guaranteeing compensation if the government agency failed to pay for services rendered.

Maximum Sum Insured: USD 11 million

Project:Supply of road construction equipmentInsurance Types: Political Risk InsuranceRisks Covered: Non-payment by a sovereign obligor (a government buyer)

An international trading company based in China won a bid to supply road construction equipment to the government agency responsible for road construction and maintenance. The company’s bank requested them to obtain insurance to mitigate against non-payment risks while sourcing and purchasing the equipment. The project supports Kenya’s vibrant infrastructure strategy that will help reduce the cost for companies to move goods within the country.  This commitment by the Kenyan government is supported by a 20% budget increase on infrastructure development with $1 billion to be spent on improving road networks alone in 2011.

Maximum Sum Insured: USD 363,000

Project:Textile ExportsCountry: TanzaniaInsurance Types: Whole Turnover Credit Risk Insurance

The textile industry in Tanzania plays a central role in the country’s economy, supplying a broad tax revenue base and employing thousands of mostly women.

The trade liberalization policies of the late 80’s weakened the domestic industry as higher quality and cheaper goods from other countries entered the local market. Many plants could not survive and some languished under improper maintenance. Today the industry is seeing a revitalisation. Under the government’s Privatisation Policy, companies are focusing on export markets. And they are taking over and rehabilitating old textile plants.

To protect its export sales of cotton yarn to buyers in China, Columbia, Rwanda, Portugal and Italy, as well as protecting its investment in new machinery, a local Tanzanian company secured Whole Turnover Credit Risk Insurance from ATI. Though comparatively small, this project can have a major impact securing a vital industry against buyer default, a likely side effect of the global credit crunch.

Maximum Sum Insured: USD 385,000

Project:Water supply improvementCountry: TanzaniaInsurance Types: Non-payment or protracted default by a sovereign project sponsor and transfer restriction

Access to potable water remains a challenge to Tanzania’s development goals. It is estimated that only 11% of households have to-the-door access to potable water while the balance of the population must travel from 15 to over 30 minutes to access water.

This project provides reliable and safe water supply to a township of over one million people located in central Tanzania. ATI is providing insurance to the Mauritius based engineering firm to cover their contract against delays in payment and non-payment by the government ministry sponsoring the project in addition to the risk of transfer restriction.

Maximum Sum Insured: USD 17.2 million

Project:MiningInsurance Types: Political Risk Insurance for Equity

This project shows how even a small venture can have direct and positive impacts on a country’s socio-economic welfare. The project supports FDI flows into the DRC and in doing so paves the way for additional investments. Armed with a three-year ATI Political Risk Insurance policy covering the full project investment, a UK-based company was comfortable investing in a precious minerals trading business in the country.

Maximum Sum Insured: USD 125,000

Project:Supply of fuel to a copper mineCountry: DRCInsurance Types: Comprehensive non-payment insurance (Commercial and Political risks)Risks Covered: Non-payment by a private buyer

A South African based fuel importer faced a challenging situation. Rising fuel prices combined with its client’s need to ramp up production meant they required greater capacity to fill the order. They sought help from a premier African bank, which set up a financing facility. ATI then stepped in with a $4 million policy that protects the bank against non-payment by the fuel importer.

Maximum Sum Insured: USD 7 million

Project:Freight Forwarding by Air and SeaCountry: KenyaInsurance Types: Whole Turnover Credit Risk InsuranceRisks Covered: Insolvency and protracted default

The services sector in Kenya continues to be one of the key contributors to economic growth impacting on nearly every sector of the economy. Under this transaction.

ATI insured a freight forwarder who sought protection against non-payment by their overseas and local customers. The company services a large number of clients in the floriculture sector – a vital sector that contributes 28% of Kenya’s total exports to Europe.

Maximum Sum Insured: USD 5 million

Project:Supply of police uniformsCountry: TanzaniaInsurance Types: Political Risk InsuranceRisks Covered: Non-honouring of a sovereign obligation (a government commitment)

After The Government of Tanzania invited bids to supply their police force with new uniforms, the tender was awarded to an East African Textile Manufacturing Company. To support this company, ATI provided an insurance policy against the Government not honouring its Sovereign obligation for the delivered goods.

Maximum Sum Insured: USD 650,000

Project:Supply and Installation of Telecommunication EquipmentCountry: ZambiaInsurance Types: Comprehensive Non payment InsuranceRisks Covered: Expropriation,Insolvency,Payment delay,Transfer restriction,War & civil disturbance and embargo

This transaction falls under a Supply Agreement between two global companies, one a manufacturer of telecommunications equipment while the other provides mobile telephone services. ATI is insuring receivables from the supply and installation of network connectivity equipment and related accessories in several African countries.

The Zambian telecommunications market remains competitive with an independently regulated telecoms sector, three competing mobile networks and a national operator, which the government is privatising. The Zambian market, with a below average penetration of mobile telephony of 29% is one of several growth markets within the East and Southern Africa region.

Maximum Sum Insured: USD 3.7 million

Project:Supply and Installation of Telecommunication EquipmentCountry: UgandaInsurance Types: Comprehensive Non payment InsuranceRisks Covered: Expropriation,Nsolvency,Payment delay,Transfer restriction,War & civil disturbance and embargo

This transaction falls under a Supply Agreement between two global companies, one a manufacturer of telecommunications equipment while the other provides mobile telephone services. ATI is insuring receivables from the supply and installation of network connectivity equipment and related accessories in several African countries.
With 10 million mobile phone subscribers out of a population of 30 million, the Ugandan market is one of several African countries poised to take off.

Maximum Sum Insured: USD 730,000

Project:Term loan facility to finance purchase of new aircraft in support of air transportationCountry: RwandaInsurance Types: Political Risk Insurance Non honouring of a sovereign guaranteeRisks Covered: Non-Honouring of a Ministry of Finance Guarantee

This project supports Rwanda’s tourism boom which brought in $200 million to the local economy in 2010. To better service the estimated 666,000 tourists that visited last year the government is revamping its ICT infrastructure, regional railway and energy grid. Shoring up its regional carrier is also seen as a core part of a plan to compete with its neighbours for a share of the lucrative tourism market and manufacturing business. To support the airline’s expansion, ATI insured PTA Bank’s loan to the airline against government payment default. In the process, ATI fulfils a core mandate to support efforts that remove barriers to trade in the region – key among these barriers is lack of efficient transportation.

Maximum Sum Insured: USD 60 million

Project:Hotel constructionCountry: UgandaInsurance Types: Foreign Direct Investment Insurance

Kampala, Uganda, like many other major African cities experienced a surge in tourism in the last decade. Their success led to a shortage of quality accommodation and meeting facilities.

To help Uganda’s tourism industry, ATI provided $25 million in Foreign Direct Investment Insurance protection to a South African based investor of an international hotel chain being built in Kampala.

Maximum Sum Insured: USD 25 million

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