YAOUNDE , February 18, 2009 -- As part of an initiative aimed at encouraging and expanding a better governed financial market and more transparent, better regulated, and more competitive financial systems, the World Bank and the Economic and Monetary Community of Central Africa (CEMAC) signed a US$50 million financial agreement on January 27.
Signed by Mary Barton-Dock, the World Bank’s Country Director for Central African Countries, and Philibert Adzembe, head of the regional central bank (Banque des Etats de l'Afrique centrale, BEAC), the agreement consists of (i) the strengthening of the central bank ; (ii) encouraging regional investment financing (through the implementation of the strategic plan of the Central African States Development Bank and the establishment of a fund providing funds to study sub-financings beneficiaries for regional integration purposes; (iii) improving regional economic policy coordination, financial sector supervision, and financial integrity; (iv) and project coordination.
The initiative will permit increased access to finance and greater availability of resources, particularly facilitating the re-utilization of surplus oil revenues in Central Africa.
The resulting project will support and strengthen regional institutions in order to promote stronger financial markets and the regional integration of Central Africa which is key for growth and poverty reduction in this area. The project also supports anti money laundering initiatives and training on micro finance.
“A specific emphasis will be put on management information systems between all the regional institutions as well as the two stock exchanges in the sub region in Douala and Libreville, financial systems and training,” Barton-Dock said.
The financial markets in the Central Africa sub region, which comprises Cameroon, Chad, Central African Republic, Congo-Brazzaville, Gabon and Equatorial Guinea, are shallow, with limited competition and few bank transactions. In addition, the insurance markets as well as the stock exchange are newly developing.
“The sub region has a lot of surpluses from oil revenues and a huge demand for investment and infrastructure but the two things are not helping each other,” Barton-Dock concluded.
It is expected that any petroleum surpluses will be re-invested in infrastructure.
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