Almost in turn, international banks of American origin are gradually displaying their
ambitions for African markets. A move that looks like an imminent offensive. Corn
while Citigroup remains the exception that proves the rule, due to its presence in 16 global markets
Continent, the American giants of international banking display a certain aversion to risk which
considerably slows down their rate of evolution in Africa. According to experts, the new program of
60 billion dollars from President Donald Trump could accelerate their projects -existing or future- especially
in a context of strong Chinese competition in terms of investments.
Seen from another angle, the slowness in the development of American banks in Africa is pushing
even an ex-African bank boss to think that the New York giants are not interested
especially on the Continent. “When I talk to a few of these banks, they give me
the impression that Africa is not - for the moment in any case - a very strategic market for them",
explains this senior financier who requests anonymity. “What some banks are currently doing
in Africa, he continues, may look large in terms of volume from the African angle, but
seen from the American angle, these are semicolons, because a transaction of 100 million dollars in the Congo
or in Ivory Coast seems huge. But 100 million dollars in the United States is the small deal
province”. According to this source, American bankers are aware of what studies on
Africa, but would not yet be worried about continuing to buy raw materials from
traders, even if the Chinese, in particular, are strengthening their base. Really ? The boost to 60
billion dollars from Trump Yet it is one of the key objectives of the "Prosper Africa" initiative,
recently launched by US President Donald Trump: to counter the advance of China, even if the
American authorities do not officially express it in this way. It is also for this purpose that in
addition to the traditional Overseas Private Investment Corporation (OPIC) -the financing institution of the
development of the American government- Washington will inaugurate, on October 1st, a new
development finance agency called US International Development Finance Corporation
(DFC) and credited with $60 billion, more than double the $29 billion wagered in OPIC.
“The United States recognizes Africa as a dynamic economy and trading partner.
essential, with six of the ten most dynamic economies in the world and more than a billion
consumers. The Continent already plays a pivotal role in the global economy, the purchasing power of
consumers reaching 1,600 billion dollars in 2017”, recognizes Tibor Nagy, deputy secretary
American for African Affairs. On the other side of the scale, the United States offers all
African States an American market of more than 300 million consumers with purchasing power -the
largest in the world - 13 trillion dollars. Just by taking these data into account, the
Americans might have more interest in investing in Africa than Africans in the United States. For
some experts, there is no doubt that this commitment by the Trump administration will have a motivating effect
on US banks. “2/3 of this money [60 billion dollars from the DFC, editor’s note] will be invested
in Africa precisely to thwart Chinese policy and then promote trade and
American investments in Africa. But how will this funding be deployed in Africa? He
need American banks. This is also the reason why entities like JP Morgan
are they interested in the Continent", explains to La Tribune Afrique Simon Tiemtoré, member of the
Board of Directors of the Africa-US Business Center of the United States Chamber of Commerce (AmCham). "
The implementation of the DFC is a way to reduce the risk [for banks, editor's note] and create a context
of blended finance. This is an important aspect in terms of incentive", considers the former manager at the Bank
world. But this program will only be active from next October, and according to Tiemtoré, it should not
not expect a real offensive from the major American banking groups anytime soon. "They're going to go
timidly", foresees the administrator of AmCham, before adding: "The sectors in which they go
engage will remain those where their capital will not be at risk, sectors that only call on their capacities for arrangement, distribution and verification”. African markets enhanced by AfCFTA
In a context where African countries seek to implement the Continental Free Trade Area
(Zleca), this agreement should double manufacturing production and boost consumer spending
and businesses to $5.6 trillion by 2025. Last week, during the African edition of the
WEF in Cape Town, Miguel Azevedo, head of Africa at Citigroup, underlined the catalytic role that the
Zleca on the business of the Continent and the boon that this agreement represents for the banks. " The good ones
companies will therefore be even better placed to take advantage of new opportunities. As they
grow, they will need more capital and that is exactly what we are doing,” he said,
according to Bloomberg. While the whole world closely follows the evolution of this strategic file for the future,
three attitudes are now observed within American banks: the motivated (already in the process of
talk about strategy); observers and wait-and-sees waiting to see what the first to
embark on a real offensive. According to our source formerly with the World Bank,
this situation cannot last too long: "Africa is no longer a market that can be ignored,
whatever the country. It is quite clear that the outlook for global growth over the past five,
next ten years will be in Africa. Eventually, the African automotive market - for example - will
surpass that of Europe, due to population growth. We have an older population in
Europe, a young population in Africa that is more susceptible to an accelerated increase in
domestic consumption. It was perhaps with a view to future interests that Morgan Stanley entrusted the year
past his African activities to a financial risk expert, Clara Woodman, who notably worked
for a long time in the region. Especially since South Africa is the best performing market of the ten countries
of the EMEA zone, according to the MSCI Emerging markets EMEA index in 2018. “America cannot counter the
China without its banks” Last February, Capital One, the fifth largest credit card provider in
world and 11th largest bank in the United States, appointed an African to its board for the first time
by: Francois Locoh-Donou, CEO of F5 Networks, an equipment supply giant
networks. This Togolese businessman is supposed to be a source of advice for the bank in the field
digital, but it would not be surprising if the son of the very influential Togolese businessman Hilaire
Locoh-Donou - which benefits from an important network, particularly in West Africa - helps, if necessary,
Capital One to see more clearly in the event of an expansion project in Africa. “What is interesting today,
is that there has been a multiplication of gateways to Africa. The first landing point
international banks interested in the Continent is no longer necessarily Johannesburg, thanks
in particular to the remarkable work of the AfDB [African Development Bank, editor's note]. It is also
Casablanca, Tunis, Abidjan, but also Nairobi, Kigali, ...", comments our source close to the circles
American businessmen. "Africa's breakthrough in the world, China's investment in Africa
Development Bank, China Investment Bank and those of Eximbank cannot let the banks
indifferent Americans. In short, America cannot compete with China on issues
of investment in Africa without its banks", hammers the ex-manager at the World Bank.