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Making China accessible to African importers
Community Manager
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Standard Bank has launched an Africa China Agent Proposition (ACAP) which aims to assist African importers source and validate quality goods, safely and efficiently, from the most competitive suppliers in China. The ACAP offering is expected to revolutionise African importers’ view of China’s supplier universe. It will also ease the cash flow of African importers by providing access to financing while empowering importers with sight and control of the entire importing and logistics process. The offering is to be launched in Nigeria, Ghana and South Africa with other markets in Standard Bank’s African footprint to follow before the end of 2019.

 

Currently African importers order from only a handful of trusted Chinese suppliers. This limits the negotiating power of African importers while stacking the terms of trade against them. While ordering online provides access to a wider range of suppliers, online imports cannot guarantee the quality of goods. In most cases too, advance payments for goods is required. This is often demanded in cash, without reciprocal guarantees of delivery or quality. This means that African importers often carry a disproportionate burden of risk in most transactions. Language and cultural barriers are also a challenge for African importers when travelling and negotiating supplier agreements in China.In response to these challenges, and in light of the vast opportunity that China presents as a trading partner, Standard Bank, the biggest bank in Africa, has leveraged its partnership with the Industrial and Commercial Bank of China (ICBC), the biggest bank in the world, to connect African importers with a dedicated trade agent in China.

 

“The ACAP offering - underpinned by a letter of credit - will deepen trust in Africa-China trade relationships, guaranteeing African importers access to the best suppliers in China, the best payment terms and the best quality,” says Dr Manessah Alagbaoso, Head: Africa China Integration, Standard Bank. If any of the terms of the letter of credit are not met, payment will not be made. As such, the offering will, “place African importers in a much stronger negotiating position when it comes to the price, quality and efficiency of importing Chinese goods,” says Dr. Alagbaoso. At the same time, “Chinese suppliers can be confident that once the terms of the letter of credit have been met, payment will be made in full and on time - guaranteed by Standard Bank and ICBC,” adds Dr Alagbaoso.

 

Zhejiang International Trading Supply Chain Co. Ltd (Guomao) is the first Chinese Trade Agent nominated by ICBC to partner with Standard Bank to assist African importers trade seamlessly with China. “Guomao currently has almost 10 000 suppliers that meet the import needs of our clients,” says Dr Alagbaoso. Where the need of a client falls outside of the supplier base that Guomao currently has, they will source new suppliers for that need after going through a process of new supplier validation and verification.

 

Guomao will assist African importers:

  • Source the right suppliers
  • Negotiate the best prices and trade conditions
  • Arrange for African importers to travel to China and meet with a broad range of suppliers
  • Provide translators to facilitate trade negotiations and discussions
  • Source and validate the quality of goods
  • Provide quality guarantees on goods from those Chinese suppliers recommended by the trade agent, ensuring that quality meets the expectations of African importers
  • Rectify any quality issues on behalf of the African importer
  • Finance imports based on a letter of credit from Standard Bank and ICBC as required
  • Handle shipping logistics

 

With over 20 years’ experience in foreign trade procurement services, Guomao provides a one-stop foreign trade supply chain, supply chain finance, and cross-border ecommerce supply chain service, “able to help Standard Bank’s clients navigate China’s foreign trade supply chain and trade seamlessly,” he adds. In time, Standard bank’s ACAP offering will include other Chinese trade agents in other key international trade hubs of China, deepening access to China’s supplier universe.  

 

Importantly, the ACAP offering will ease the cash flow of African importers. “Since Chinese suppliers will be secure in their possession of an ICBC-underwritten letter of credit, African importers will be able to receive goods before payment is made,” explains Dr. Alagbaoso. This will allow African importers to keep cash in the business for growth.

 

Standard Bank’s developed experience in building and operating its broader Africa-China trade corridor also recognises the importance of African importers travelling to China to meet with their Chinese suppliers. “Each African country has its own way of doing business. Similarly, in China, suppliers have their own expectations of how business should be conducted,” explains Dr Alagbaoso. African importers meeting, face-to-face, with Chinese suppliers builds an understanding of what is expected when doing business with China. “It is also the foundation of long-term, mutually beneficial and sustainable trade relationships,” he explains.

 

“Equipping African importers to navigate both the simple and the complex aspects of doing business in China is what our ACAP is there to facilitate,” says Dr Alagbaoso.

 

African importers can access China’s broad universe of suppliers, as well as the entire Standard Bank and ICBC-supported import process for free. Besides the usual fees associated with conducting an international trade via a letter of credit, “the entire ACAP offering is available without cost, simply by joining Standard Bank’s digital trading platform, called Trade Club,” says Dr. Alagbaoso.

 

Standard Bank’s secure and seamless ACAP offering combines ICBC’s access to the highest levels of the Chinese financial system with Standard Bank’s deep expertise in driving Africa’s growth, “enabling balanced cross-border trade between Africa and China by expanding opportunities and transparency, and deepening trust,” says Dr Alagbaoso.

 

For any queries please email to : [email protected]

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1 Comment
bharat n ruparlia
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kindly assist us with Email addess of:-

1). Zhejiang International Trading Supply Chain Co. Ltd 

2). industrial commercial bank of china