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 (…

The African private equity sector is exposed to the upheavals caused by the coronavirus in the region

Private equity entities present or operating in Africa are not spared the upheavals caused by the coronavirus. Many companies that count private equity funds as investors are also exposed to the negative consequences of the containment measures taken by several countries in the region to cope with the pandemic.

In South Africa, the Central Bank is not ruling out the possibility of quantitative easing, which will involve intervening on the capital market, by buying bonds to bring balance to the financial sector, especially banking. At the moment, the arrangements for supporting investments made by firms and private equity funds are unclear.

According to data provided by the crunchbase database, it emerges that the amounts of funding known and mobilized in the first quarter of 2020, were $ 1.24 billion. This is the lowest level for the period since 2016. Some observers note that contributors to investment funds will have to plan to be in their capital for a longer period.

Insofar as the companies benefiting from private equity investments are also likely to experience poor performance, voices are raised asking for support from these companies. This request was particularly made by the South African Private Equity Association. According to relevant data collected by the Ecofin Agency, 172 investment funds focused on Africa are active in the region.

In addition to these investment funds, we can also note the presence of development finance institutions with the capital of nearly 450 companies or investment funds. Private equity is just as important a part of the financing of the economy as the banking sector in Africa. Its evolution in the next post-covid-19 years is to follow.