AfDB Warns Africa’s Trade Finance Gap May Hit $86.6 Billion

The African Development Bank (AfDB) has warned that Africa’s trade finance gap could widen to as much as $86.6 billion by 2027 as escalating geopolitical tensions in the Middle East, rising energy prices and tightening global credit conditions increase pressure on the continent’s trade ecosystem. 

The warning was contained in the bank’s newly released 2025 Trade Finance Report, which noted that disruptions to critical global shipping routes, including the Strait of Hormuz, have introduced fresh risks to African economies already facing constrained access to international trade finance. 

The AfDB noted that at least 29 African currencies have depreciated since the outbreak of the conflict, placing additional pressure on foreign exchange reserves and import financing. It is projected that under a moderate risk scenario, Africa’s trade finance gap could rise to $86.59 billion by 2027, representing about a 17.66 percent increase from the $73.59 billion recorded in 2024. 

The bank warned that the weakening of African currencies and rising import bills could trigger stricter lending conditions from international correspondent banks, thereby limiting access to trade finance for businesses across the continent. In a more severe scenario involving prolonged disruption of the Strait of Hormuz and tighter global credit conditions, the continent’s trade finance gap could widen further to $95.59 billion by 2027. However, under a baseline scenario without major geopolitical disruptions, the bank estimated that the trade finance gap could gradually narrow toward $65 billion.

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The report highlighted that inflationary pressures across Africa could worsen further as sustained energy price shocks continue to affect production and import costs, with the AfDB projecting that inflation across Africa could average 10.4 percent in 2026, nearly one percentage point above earlier forecasts released in January 2026. The bank added that global financial institutions are increasingly redirecting capital toward conflict-related hedging activities, reducing risk appetite for trade finance exposure in emerging and frontier markets.