BCEAO releases $ 6 billion for West African economies

The BCEAO has just made a liquidity injection of 3350 billion FCFA ($ 6 billion) at a fixed rate of 2% in favor of several banks of the UMOA. A total of 87 financial institutions participated in the operation. The Central Bank of West African States (BCEAO) made a further injection of liquidity to its member countries last week. In total, 3350 billion FCFA ($ 6 billion) were disbursed by the institution.

During the auction on September 14, 87 banks in the sub-region obtained an injection of liquidity at a fixed rate of 2%. With more than 1000 billion FCFA ($ 1.8 billion), it is the Ivory Coast which obtained the most important financing, ie 31% of the funds injected.

It is followed by Senegal with more than 580 billion FCFA ($ 1 billion), Mali with 466 billion FCFA (835 million $), Benin with 434.5 billion FCFA (777 million $) and Burkina Faso with 318 billion FCFA. ($ 569 million). Niger with 241.6 billion FCFA ($ 432 million), Togo with 219 billion FCFA (…

Brussels approves exceptional spending by Italy against coronavirus

The Commission will keep in mind the exceptional circumstances when judging the budgets and deficits of the Member States, announces the European Union. In extraordinary situations, extraordinary measures. On Saturday March 7, Rome published a letter from the European Commission in which the Union authorities express their "full support" to Italy, facing the epidemic of coronavirus. The authors of the missive also explain that the exceptional expenditure "decided in response to the epidemic" will not be taken into account by Brussels in order to determine if a country like Italy respects its budgetary commitments vis-à-vis the Union.
Brussels approves exceptional spending by Italy against coronavirus

While Rome initially planned a 3.6 billion euro plan to fight the epidemic, the total amount has been increased in recent hours. Friday, the Italian Minister of Finance, Roberto Gualtieri, sent a letter to Brussels justifying his choice to mobilize 7.5 billion euros to deal with the coronavirus. A decision explained both by the need to increase the means of the authorities to fight the disease, but also by the need to support the economy, and in particular the most affected sectors such as "transport, accommodation, services tourism, entertainment, cultural activities and business events ”.

However, these measures will come at a cost: Rome expects its deficit, forecast at 2.2% of GDP in 2020, to drop to “2.5%” for the year. The government therefore had to obtain approval from Brussels to validate its plan. "The EU should respond to this emergency by using the integrated flexibility of the Stability and Growth Pact and by preparing a coordinated fiscal stimulus plan," argued the Italian finance minister. "We are not jumping into a vacuum," insisted the head of government, Giuseppe Conte. He also promised to quickly bring the deficit down to 1.8% in 2021 and 1.4% in 2022.

The European Commissioner for Economic and Monetary Affairs, Paolo Gentiloni, responded in a letter published Saturday to the Italian request, stating that "any exceptional expenditure decided in response to the epidemic would, by definition, be excluded from the calculation". In addition, "our framework of budgetary rules offers the flexibility necessary to respond to unusual events beyond the government's control," writes the European representative, adding that the Commission will have in mind the exceptional context when evaluating state budgets. members.

In other words, Brussels will not take into account these costs, considered as “one-off”, or exceptional expenses, to estimate if Italy respects its structural budgetary commitments vis-à-vis the European Union. On Twitter, Commissioner Gentiloni also expressed his "support and solidarity for Italian citizens and government initiatives" in the face of the disease. 

Rome will therefore be able to continue its mobilization against the epidemic. This decision was expected: earlier this week, Paolo Gentiloni had estimated that the Italian device - at the time estimated at 3.6 billion euros - was "proportionate". The representative added that the Boot's proposal would be studied "in a spirit of solidarity and understanding", recalling that the current crisis was an "unusual event", requiring an appropriate response. The EU is also ready to deploy "all the political options available if and when necessary to protect our growth against these downside risks," he said.