Francophone Africa has long been seen as a French domain that was closed to other international players, but as prospects in many Middle Eastern countries recede, Francophone Africa is being viewed as an interesting and attractive business opportunity for those who are familiar with emerging markets and who are looking for new clients and relationships.
To find out more about how financial markets in Francophone Africa are changing, Arab Banker spoke to Nabil Frik, Managing Director for Africa at BACB, a London-based bank that is active in African markets.
What does Francophone Africa mean?
It includes countries that are members of the Organisation Internationale de la Francophonie (OIF), such as the two Congos, Côte d’Ivoire, Senegal, Burkina Faso, Gabon, Togo, Niger, Chad, and Cameroon.
What binds Francophone Africa together?
Beyond language and colonial ties, they share a currency pegged to the euro and guaranteed by the French treasury. The two zones are UEMOA (West Africa) and CEMAC (Central Africa), both using the CFA franc. They also share a business law system under OHADA, facilitating regional trade.
Is the region still dominated by French companies?
French institutions remain key, but the region is no longer a "chasse gardée." British banks like BACB and embassies are actively engaging with the region.
Who are the main players in Francophone Africa?
Morocco has made major inroads through manufacturing and financial services. Moroccan banks now hold more capital in the region than French banks. Insurance firms are expanding similarly.
What about China, Turkey, and Nigeria?
China focuses on infrastructure in East/Central Africa and agriculture in the West. Turkish firms are active in infrastructure. Nigerian banks, despite scale, struggle due to cultural differences.
Local Banks and Basel Regulations
Most local banks are small. If Basel II or III regulations are adopted, they may struggle to meet requirements like the 25% single borrower limit.
Multilateral Institutions
Afreximbank, the African Development Bank, and the Islamic Development Bank are increasingly active, filling gaps left by Western banks retreating due to de-risking and compliance.
Advice to New Entrants
Learn French and establish a local presence. BACB opened an office in Abidjan to build strong relationships and demonstrate long-term commitment.
Profile of Francophone African Countries
| Country | GDP ($bn) | Population (mn) | CFA Zone | OHADA Member |
|---|---|---|---|---|
| Benin | 8.5 | 10.9 | UEMOA | Yes |
| Burkina Faso | 11.1 | 18.1 | UEMOA | Yes |
| Cameroon | 29.2 | 23.3 | CEMAC | Yes |
| Central African Republic | 1.5 | 4.9 | CEMAC | Yes |
| Chad | 10.9 | 14.0 | CEMAC | Yes |
| Congo (Dem. Republic) | 35.2 | 77.3 | CEMAC | Yes |
| Congo (Republic) | 8.6 | 4.6 | No | Yes |
| Côte d’Ivoire | 31.8 | 22.7 | UEMOA | Yes |
| Gabon | 14.3 | 1.7 | CEMAC | Yes |
| Guinea (Bissau) | 1.1 | 1.8 | UEMOA | Yes |
| Guinea (Conakry) | 6.7 | 12.6 | No | Yes |
| Mali | 13.1 | 17.6 | UEMOA | Yes |
| Niger | 7.1 | 19.9 | UEMOA | Yes |
| Senegal | 13.8 | 15.1 | UEMOA | Yes |
| Togo | 4.9 | 7.3 | UEMOA | Yes |
About Nabil Frik
Nabil Frik is a bank specialist expert living in London and Frankfurt. He studied engineering and finance in Germany. He is an expert in Africa and structured trade finance. He joined BACB in 2013 as Managing Director for Africa.
Source: Arab Banker's Association