The African continent is facing major financial challenges that are hampering its economic development. Faced with insufficient growth, growing public debt and limited financial inclusion, what initiatives have African banking institutions and stock markets put in place to overcome these obstacles? Let’s explore some innovative projects aimed at easing the burden of debt and freeing up essential resources for the continent’s development.
Africa’s economic development is hampered by major financial challenges, including insufficient growth, growing public debt and limited financial inclusion. Faced with these challenges, banking institutions play a crucial role. Innovative initiatives are emerging to alleviate the debt burden and free up resources for the continent’s development. Traditional banks and African stock exchanges are trying to diversify their sources of financing.
“The first pillar is what we call the Global Trad Bank, which enables us to be the bank of banks in Africa today. We’ve been talking since the morning about the level of risk of international financial institutions from the continent. What the African Export-Import Bank does is provide African banks with this international opening through correspondent banking. In this respect, we currently work with more than 200 banks on the continent. Our goal is to work with 500 banks by 2026.”
JEAN ARSÈNE YERIMA, Regional Director, West Africa Operations, Afreximbank – Cameroon
The growth of African economies, a major challenge to the continent’s development, is still below average, according to experts, particularly in the WAEMU zone, with a deficit of around 26%. Stock markets are proposing initiatives to be put in place.
“I think that the approach that should lead African entrepreneurs, our States, etc. to focus on projects, their profitability, the cash flow that these projects can generate. This approach is much more important than financing, because once you have proved that the projects are interesting, profitable, with the necessary cash flow, you can always find the financing, whether it’s local or from outside..”
EDOH KOSSI AMENOUNVE, Managing Director of BRVM – Côte d’Ivoire
Furthermore, for Africa, which accounts for just 3% of global investment in energy, initiatives such as the creation of the African Energy Bank with an initial capital of 5 billion dollars should also make up for the continent’s economic development funding shortfall, by financing projects linked to fossil fuels such as oil and gas.