The Central Bank of West African States just released its annual report on banking conditions across the WAEMU in 2017. The document provides a detailed review of the union’s banking sector, with specifics regarding loans granted over the last year, as well as customers’ deposits and interest rates in place.

In five points, here is a summary of the apex bank’s report for Togo.

No new institution in 2017

Though three new banks joined the union’s market, in Côte d’Ivoire, Burkina Faso and Senegal, the BCEAO’s report indicates that in Togo, the banking sector recorded no new arrivals with 15 lending institutions, 13 banks and 2 financial institutions, operating in the country, just like in 2016. In 2017, indicators of the banking sector were overall satisfying, despite some corrective measures imposed on some institutions, including two State-owned banks. Also, though some banks show concerning signs, the central bank says measures were taken to improve affected ratios, such as social capital threshold. The latter is now set at CFA10 billion for banks and CFA3 billion for financial institutions.

Lower volumes of loans granted

Following consecutive surges, knowingly a 13.5% increase to CFA664.4 billion, in 2016, loans provided by Togolese banks slumped by about 4.2% falling at CFA632.2 billion. Out of this amount, private firms captured the most. However, on a year-to-year basis, the figure slumped by 10.4%; a decrease spurred by lower loans dedicated to equipment purchase which fell 61.9% to CFA39 billion. Moreover, housing loans also decreased by 42%. Same goes for loans given to support exports. Meanwhile, consumption loans increased but very slightly.

Loans granted to cooperatives, village associations, individual companies, insurance companies and pension funds also decreased. This is alarming, considering that in Togo, close to 70% of the people live off agriculture.

Overall, the slump is attributed to the socio-political crisis recorded in the second half of 2017. Indeed, due to the political uncertainty resulting from the crisis, some banks preferred pushing the risk on treasury loans. They indeed disbursed more than CFA327 billion (+19%) for companies treasury.  

Higher interest rates for vulnerable groups

While average debit interest rates applied in WAEMU states remained stable in 2017 (about 6.93% in Togo), the lowering trend started since 2012 is maintained. Last year, rates were the lowest in the past decade. It improved 21 base points to 8.1%. According to the central bank, this is due to high rates imposed by intermediates. In detail, rates applied for cooperatives, village associations and insurance-pension funds were the highest, 9.15% and 9.74% respectively.

Long-term loans are safer

In 2017, long-term loans were the safest for banks. In effect, rates for 10-year loans were the lowest, while very short term loans (less than a month) had the highest interest rates.

Deposits plunged drastically  

In 2016, customers deposited a total CFA1,742.2 billion. Last year, banks collected 28% less, knowingly CFA1,254.4 billion.

From private companies operating in the production chain, banks collected CFA313 billion, thus 25% more than the year before.  

Fiacre E. Kakpo

Approved during a ministers council end-March 2017, the merger between State-owned banks BTCI and UTB was suspended, sources close to the case told Togo First.

“The merger is suspended and its effective date has been postponed…until ongoing talks with the IMF, regarding other options to restructure or rescue BTCI and UTB are concluded. The two institutions will hence restart operations, independently,” reads a note addressed to the lenders by Patrick Mestrallet who is in charge of the merger.

The merger was decided by the government to “consolidate the banks’ financial situation and increase their respective capitals, thus solvability in order to improve their intervention capacities to better support the national economy,” after their privatization failed.

Concerning the latter, it was a measure initiated by the International Monetary Fund (IMF) in line with its 3-year ECF programme signed in May 2017 with the Togolese government. This program aligned with Lomé’s will disinvest from public banks.

Séna Akoda

For its 45th anniversary, the West African Development Bank (BOAD) has launched a new contest which will reward the best bearers of clean energy projects (in WAEMU) with a CFA30 million grant.

Eligible applicants include civil society organizations, professional or non-professional associations, researchers, and private entities. Projects submitted should include an environmental resilience component, help create jobs for youth, boost Togo’s competitiveness in renewable sector, and meet basic social needs, among others.

The prize to be gained is one of many advantages that the contest’s winner is to benefit from. Applicants have until next October 8, to submit their candidacy.  

Séna Akoda

From October 23 to 29, 2018, the International Agriculture and Agrofood Fair of Lomé (SIALO) will take place. This was recently announced by the event’s coordination team on its official website.

The seventh edition of the fair will be held at the Centre Togolais des Expositions et Foires (Togo 2000) to be exact.

The Sialo brings together various actors of the Togolese agricultural, fishing, husbandry, agrofood, catering sectors, among others.

Its promoters aim to foster talks and exchanges between these actors, thereby promoting local agricultural projects and attracting subventions for these. The event also exists to improve access to the international market, information, research, training and innovations in the agricultural sector.

During the fair, there will be agrofood days across the country’s various regions, a market place with exhibitions of products, services, technologies, and innovations, B2B meetings, etc.

Paired with SIALO’s 7th edition is the 4th packaging fair. 

Séna Akoda

Launched by Bernadette Legzim-Balouki, minister of Trade, the Project for the sustainability and reinforcement of cashew and sheanut’s commercial capacities (PRODAK) will benefit from a three-year $5.6 million financing. This was disclosed by Commodafrica. 

In this framework, Togo’s government and the World Trade Organization (WTO) signed a financing agreement last week. The monies will be disbursed via the Reinforced Integrated Scheme, which is led by the WTO.

The project’s end-goal is to improve the quality of cashew, sheanut and their derivatives. It should also help both sectors’ productivity, making them true cash crops. This will also help slightly raise revenues of the sectors’ actors.

Séna Akoda

African farmers will now easily benefit from Israel’s technologies and solutions. Related memorandum of understanding was signed between the African Green Revolution Alliance (AGRA) and Tel-Aviv-based NGO Start-Up Nation Central (SNC).

This was during the 8th African Green Revolution Forum (AGRF) held Sept 5-8, 2018, in Kigali, Rwanda, under the theme “Lead, measure and grow”.

According to SNC’s president, Eugene Kandel, the partnership will help mitigate risks associated with food scarcity in Africa (actually more than 150 million people of more than 15 years are suffering from severe food insecurity).  

Mostly financed by philanthropy, SNC offers solutions based on Israeli innovations to companies, governments and universities. It developed Start-Up Nation Finder, a platform that gathers more than 5,000 top innovative Israeli firms operating across various sectors, agriculture included.

AGRF is one of the main forum dedicated to African agriculture. Last year, it was held in Côte d’Ivoire.

Octave A. Bruce

The China-Africa Development Fund (CAD Fund) plans to invest in Asky Airlines, a Lomé based pan-African airline which seeks new strategic partners.

Presenting interests and opportunities in Togo’s 2018-22 National Development Plan (PND), CEO Shi Jiyang, said the fund will support new projects in Togo including Asky Airlines.

“CAD Fund will continue to support projects in infrastructure, industrial parks, hydroelectric power, resource development and aeronautics,” the manager said during the China-Togo Business Forum in Hangzhou.

Mr. Shi indicated that the desire to enter into the company’s capital is subsequent to its good performance, particularly in 2016. In addition to the aeronautics sector, the fund also intends to support the project to extend the Port of Lomé and create an industrial park in Togo. Let’s note that CAD Fund is the Chinese private investment arm in Africa.

Fiacre E. Kakpo

Lire aussi:

https://www.togofirst.com/en/investments/1109-1578-togo-cad-fund-to-support-new-development-projects

In Lome, in the framework of the launch of a campaign to promote passenger’s rights, Daouda Elhadj Adam (photo), president of Union Africaine des Consommateurs (UAC), a pan-african consumers’ union, presented a press conference on September 13, 2018.

During the conference on air travelers’ rights in Africa, the official presented the aims of this campaign to journalists. According to his statement, African air travelers are affected by several problems notably, the high cost of airline tickets, thus difficult to afford for the average traveler, the limited or rather absent supply of direct flights to towns on the continent, the delays, overstatements and flight cancelations without warning.  

It is, therefore, an awareness-raising campaign and a plea will be launched for political authorities and airline companies to have greater respect for African travelers’ rights.

Let’s remind that though there are texts regulating air transport in Africa, those texts are less known (if not unknown).

 “We will monitor the implementation of these measures to ascertain the impact of liberalization in this important sector for African consumers”, Daouda Elhadj Adam indicated.

During his stay in Lome, Daouda Adam will discuss with Togo’s members about this Pan-African association grouped under ATC (Association Togolaise des Consommateurs) and LTC (Ligue Togolaise des Consommateurs). 

Octave A. Bruce