The Export Credit Insurance Corporation of South Africa (ECIC), in collaboration with key stakeholders in the transport and financial sectors, recently participated at the Southern African Railways Association (SARA) Rail Conference and Exhibition.
At this year’s event, the ECIC highlighted how the Luxembourg Rail Protocol can serve as a powerful catalyst for incentivising rail sector exports and unlocking growth opportunities for South African manufacturers, financiers, and operators. The Luxembourg Rail Protocol, which provides a harmonised international legal framework for the recognition and enforcement of security interests in railway rolling stock, introduces significant advantages for exporters and financiers alike, with enhanced access to finance.
By reducing lender risk through stronger asset-based security, the Protocol lowers financing costs and expands access to credit for rail-related exports. It also acts as a functional platform as a boost to rail exports. South African manufacturers of locomotives, wagons, components, and signalling equipment stand to gain from increased competitiveness in regional and international markets.
In light of market expansion across Africa, the Protocol supports cross-border interoperability and ownership recognition, making it easier for exporters to penetrate new markets across the African continent as well as stimulating private investment. With greater legal certainty, it encourages more private sector participation in the financing of rolling stock and rail infrastructure projects.
Accordingly, ECIC announced that when the Protocol is in force in the state of the debtor/lessee, ECIC will apply a discount of up to 20% to its risk premium when it underwrites rolling stock financings, subject to ECIC's minimum local South African content rules, compliance with the Protocol and other underwriting conditions. A detailed policy guideline was scheduled to be published by ECIC in the days following the announcement.
The Luxembourg Rail Protocol is a game-changer for Africa’s rail industry. By aligning financing structures with global best practice, it not only strengthens investor confidence but also positions South African exporters to play a leading role in supplying the continent’s rail revolution. The ECIC is committed to supporting exporters in seizing these opportunities through innovative export credit solutions.
The ECIC’s presence during this year’s 2025 SARA Rail Event showcased how export credit insurance can be leveraged in conjunction with the Luxembourg Rail Protocol to unlock new financing channels, de-risk transactions, and build the foundation for a sustainable and integrated African rail sector.
