IB Bank Togo (former BTCI) and Togo’s National Council of Employers (CNP-Togo) inked last Friday a partnership agreement that will help local SMEs and SMIs readily secure financing. The agreement was signed by the bank’s MD, Nabil Tahari, and Laurent Tamegno, who heads the CNP.

“The goal is to review the offer provided to these types of clients,” said Tahari before adding that “IB Bank Togo will do everything to help SMEs materialize their projects.”

According to the two partners, SMEs and SMIs make up 90% of the country’s economic fabric, and developing them is one of the government’s top priorities. However, they stressed that these businesses are the most vulnerable to global crises. That is why IB Bank Togo, which belongs to Burkinabe mogul Mahamadou Bonkoungou, proposes accessible offers tailored to Togolese businesses, especially in agribusiness, transport, and infrastructure sectors. 

Before its purchase by Bonkoungou, the BTCI was Togo’s last fully public bank. Now, the State owns only 10% of the bank. The remaining 90% are held by IB Holding.

Esaïe Edoh

The World Food Program, WFP, greenlit Togo’s 2022-2026 food security strategy last month in Roma. The $17 million plan aims to help around 260,000 people who face food insecurity in the West African country. Also, it aligns with the ambitions falling under the government’s 2020-2025 roadmap. 

Concretely, the WFP will provide food and cash to those facing multi-dimensional crises in Togo. This support should allow the beneficiaries to prepare ahead of, and appropriately tackle emergencies.   

Besides, a pilot school feeding program will be implemented as part of the five-year strategy backed by WFP. This initiative will be based on local production and help smallholder farmers reduce their post-harvest losses. In effect, supply contracts will be established between these producers and school canteens, in line with the government's priorities relative to the Sustainable Development Goals (SDG 2030).

The WFP’s support complements the World Bank’s $716 million financing for the Regional Food Systems Resilience Program in West Africa (PRSA), which covers Togo and six other countries in West and Central Africa.

Esaïe Edoh

The Togolese government will indemnify the families of soldiers killed during military operations carried out inside the country. The grief-stricken will get CFA10 million.

Both agreeing on the amount, the minister of economy, Sani Yaya, and the minister of security, General Yark Damehane, disclosed it in a joint decree. 

According to the decree, the sum, “chargeable to the State budget,” will be shared between the deceased’s beneficiaries, in line with succession-related provisions in force in Togo.

The new measure follows the killing of eight Togolese soldiers in a terrorist attack that happened in Kpekpakandi, located in the Kpendjal prefecture. 

Esaïe Edoh

At the last quarterly meeting of the National Credit Council (CNC) held on July 1, Sani Yaya, the Togolese minister of economy, brought back agricultural financing to the table.

"At our previous meeting, I suggested the organization of a national workshop to reflect on the financing of the agricultural and housing sectors. But, to be more pragmatic and efficient, I asked instead to put the issue of agricultural financing on the agenda of this session. We will examine the issue of housing finance at the next meeting of the Council," he said at the meeting, which brought together the banking and finance actors of Togo.

The goal was especially to identify "the constraints to which the actors of the agricultural value chain are exposed; the requirements of banks and decentralized financial systems to further increase the financing of agriculture.” The idea was also to see how to strengthen and accelerate the effectiveness of the Risk-Sharing Agricultural Finance Incentive Facility (RFAIFF), and to identify "a set of measures to address financing issues in the agricultural sector."

These reflections involved stakeholders from the Ministry of Agriculture, Livestock and Rural Development; the Regional Office of the International Fund for Agricultural Development (IFAD); the MIFA; and the Togolese Coordination of Farmers' Organizations and Agricultural Producers (CTOP).

Ultimately, the government and its partners will have to “identify a set of measures to further increase funding for the agricultural sector.”

In Togo, the agricultural sector, although representing about 40% of the national GDP, benefits from only 0.2% of total bank financing.

Due to the war in Ukraine, Togo scaled down its growth forecasts for the year. From 6.1% the figure was reduced to 5.9% by the ministry of finance.  

Sani Yaya, who heads this ministry, disclosed the information last Friday, at the National Credit Council of Togo (CNC), a meeting that gathered the country's bank and finance actors. 

"As you know, since the end of February, the world has been shaken by geopolitical tensions induced by the Russia-Ukraine conflict. This has disrupted post-Covid-19 recovery plans," Yaya said. "This conflict is directly affecting economies through trade and indirectly through its impact on rising energy prices and imported food products," he added.

While new projections, at the national level, confirm an improvement in economic activity, they highlight a slight decrease of 20 base points (0.2%) which explains the forecast revision. 

The government is more optimistic than the African Development Bank (AfDB) which expects Togo to record a growth of 5.8% in 2022. However, both parties agree on the decrease of about 20 base points (AfDB initially issued a forecast of 6.2%).

Some good news

Not everything is bad. Indeed, Sani Yaya revealed last Friday that bank lending has risen sharply since the beginning of the year. It grew by 39% YoY to CFA270 billion in Q1 2022.

Over the same period, decentralized finance systems loaned CFA50 billion to economic operators, up by 37% compared to Q1 2021.

Another good news is the sustained improvement of lending by banks and microfinance institutions in the first quarter of this year. The gross deterioration rate of the credit portfolio of banks (the ratio between gross outstanding loans and total loans), has decreased by 5 percentage points, from 16% in Q1 2021 to 11% in Q1 2022. A positive trend that Togo First had already noted.

Ayi Renaud Dossavi

With over 5.4% of rapid cash transfers made within the WAMU, the Togo-Benin corridor is the fourth most dynamic in the region, according to data from the BCEAO. Transactions between residents of these two countries were more significant than those between Mali and Senegal. 

Meanwhile, traditional corridors, which include Burkina Faso, Côte d'Ivoire, and Mali remain the most active.

Intra-WAMU rapid cash transfers reached CFA432 billion in the first half of 2021, up 25% year-on-year. In this period, the volume of transactions swelled by 18%, passing 8.6 million.

Côte d'Ivoire, WAMU's economic powerhouse, sends 54% of all funds transferred within the region. Burkina Faso captured 54% of the money sent by other WAMU countries, in terms of value.

Coris Bank International Togo launched its e-money service, Coris Money, last Friday, July 1. Through the move, the lender wants to boost financial inclusion in the country. 

“Beyond its innovative aspect, launching this tool today is CIB Togo’s contribution to the financial inclusion policy of Togolese authorities,” said Alassane Kaboré, Managing Director, CIB Togo.

Coris Money lets the bank’s customers and non-customers deposit and withdraw money using their phones. The app’s users can also pay their bills and transfer money within and outside Togo. 

According to CIB Togo, in its pilot phase, Coris Money had 15,000 users. The lender expects this figure to reach 35,000 by the end of the year.

Active in Togo since 2015, CIB’s subsidiary recorded a total balance sheet of CFA309.9 billion in 2020, or 50% more than it did in 2019–CFA205.38 billion.

Esaïe Edoh

Togo launched a new simultaneous recovery bond issue last Friday. With this operation, which follows a similar one that Lomé successfully carried out on June 24, the country’s treasury aims to raise CFA30 billion on the UMOA securities market.

The new issue will close on July 8. The bonds have a nominal value of CFA10,000, maturities of five and 10 years, and interest rates of 5.8% and 6.1%.

The proceeds will help “meet Togo’s budgetary needs as part of its post-Covid-19 economic recovery plans.”

Togo, let’s recall, wants to raise more than CFA550 on the UMOA securities market this year.

Esaïe Edoh

Togolese authorities have forbidden the sale of petroleum products – super unleaded and diesel, especially - in jerrycans. The measure was disclosed via a statement co-signed by the ministers of trade and security, Kodjo Adedze and Yark Damehame. The document was issued on June 28,  2022.

"We noticed that some gas stations have been selling petroleum products, especially super unleaded and diesel, in jerrycans and other containers. Given the flammable nature of these products and to guarantee the safety of people and property, selling super unleaded and diesel in cans and other containers is prohibited throughout the national territory," the document, dated June 28, 2022, reads.

However, "a special dispensation is nevertheless granted to owners of generators on presentation of proof of ownership," it adds.