London-based Kimura Capital is set to launch an African focused Commodity Trade Finance Fund that will comprise loans backed by physical commodity assets.
The Fund is launched in partnership with Dhow Advisory who bring their expertise in originating transactions in Africa and presence on the continent.
Dhow Kimura will offer both an open-ended and closed ended structures, focused on hard and local currency commodity financing opportunities related to extra Africa and intra African trade. Supporting the Africa Continental Free Trade Area capitalizing on the African Development Banks estimated USD80bn annual trade deficit in Africa.
The fund will invest in self-originated trade finance opportunities across selected geographies in Africa. Target borrowers are SMEs who may be financially excluded, or impacted by liquidity challenges, and Sovereign states needing to finance the import of strategic commodity flows, such as fertilizer and maize.
Leveraging their experience and 5-year track record in their Cayman based Trade Finance Fund, Dhow Kimura hope to reach new investors, looking for diversified risk in high demand commodity supply chain transactions.
The partnership with Dhow will continue to build on Kimura’s commitments to increasing sustainability within the supply chain. The investments will contribute toward the growth and development of the SME sector in Africa. Strengthening the availability of finance to SMEs has significant beneficial economic and social impacts and is viewed as critical in achieving a number of the Sustainable Development Goals.
Kimura, a signatory of the UN PRI, will continue to implement their proprietary ESG due diligence standards, within the investment making process for all assets under management.
Kimura CEO Kristofer Tremaine said
“Kimura has had ambitions to enter the African market for some time. However, managing risks and governance diligently could only be achieved with a deeply experienced team of experts who have ‘Boots on the ground’. Kimura was not able to achieve this, until now. Our partnership with Dhow marks an exciting new horizon for the company, as our business continues to expand across the globe, providing expertise and funding solutions in the wake of the present liquidity drought. We feel the partnership with Dhow has great potential, combining niche market knowledge and relationships, with Kimura’s strong operational platform and best in class governance.”
Dhow Advisory CIO Michael Kagwa commented “With the reported $80bn annual deficit in African Trade Finance, the fund seeks to support African SMEs in their efforts to secure commodity-backed financing to sustain their activities in intra-African and extra-African trade. The fund aims to help businesses to grow and to have a continued impact on employment and GDP growth across the continent.
