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Country Commercial Guides for FY 2000:
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CHAPTER VIII: TRADE AND PROJECT FINANCING
1. The Banking System
Côte d'Ivoire is a member of the Communaute Financiere Africaine, a financial grouping of Francophone African countries. Within that grouping, it belongs to the Union Economique et Monetaire de l'Afrique de l'Ouest (UEMOA). The BCEAO, located in Dakar, is the central bank for UEMOA members. The currency issued by the BCEAO, the CFA franc, is convertible against the French franc at a rate of 100:1; convertibility is guaranteed by the French Treasury.
There are 15 commercial banks in operation in Côte d'Ivoire. Selected banks with their U.S. (or other foreign) correspondent banks are listed in Section 6 below. There is a regional stock exchange, and over 30 insurance companies and the African Development Bank are headquartered in Abidjan. The World Bank and the International Finance Corporation also maintain regional offices.
Banking supervision for the eight UEMOA countries is the responsibility of the Banking Commission, headquartered in Abidjan. The Governor of the regional central bank, the BCEAO, also serves as Chairman of the Banking Commission, but the Commission also includes representatives of each member state and France, and eight independent members appointed by the member states. Although current capital requirements are lower than the international standard set by the Bank for International Settlements, the Banking Commission has exercised vigilance over the banking sector and the Ivoirian Government has paid out depositors from a bank that failed in the 1980's.
2. Foreign Exchange Controls Affecting Trading
Exchange controls within Côte d'Ivoire are administered by the Directorate of External Finance and Credit. According to Ivorian law, all exchange transactions relating to foreign countries must be handled by authorized banks or the Postal Administration. If an imported item has a value in excess of approximately CFA/F 500,000 (CFA/F 600 equals 1 US) the transaction must involve an Ivorian bank. Transactions involving goods valued at less than this amount must be handled by an authorized Ivorian bank if a financial transaction is to be undertaken before customs clearance. Import attestations allow importers to purchase any necessary foreign exchange, but no earlier than eight days before the scheduled shipment of the goods. All foreign exchange to be used for import payment must be purchased either on the date of settlement specified in the commercial contract, or at the time when the required down payment is made.
French Franc based transactions are the easiest and most common. Dollar based transactions may take longer. The fees associated with processing exchange transactions are high and vary slightly between banks. Proof of an importing transaction is required to remit payments for imports denominated in other currencies.
3. General Finance Availability
Commercial lenders tend to rely more on collateral than on prospective income and cash flow. Financing is generally available for short-term, (one year or less) private sector projects. Interest rates were kept high following the devaluation in an effort to control its inflationary impact. Since the devaluation, flight capital has returned, the liquidity within the system has increased substantially, and inflation has been on a declining trend. All these factors have led to single-digit interest rates, for the first time in years. Banks continue, however, to extend credit only to a limited group of borrowers--mostly large companies--who are deemed good credit risks. The current lending rate ranges from 15 to 17 percent. Medium to long-term infrastructure projects, even when privatized, are often financed by multilateral lending institutions such as the World Bank or the African Development Bank or by European foreign aid programs, rather than by commercial banks.
4. How to Finance Exports/Methods of Payment
While traditional trade finance instruments such as letters of credit, collections, and funds transfer are available to the exporter, the associated fees are high compared to other regions. If a letter of credit is chosen, the exporter should require an irrevocable, confirmed letter of credit to ensure prompt, reliable payment. The OPIC/Citibank African Trade Facility of USD 100 million is available. The Côte d'Ivoire country limit is USD 10 million.
The USDA's West Africa Regional GSM-102 Credit Guarantee Program provides access to financing for imports of wheat, rice, feed grains, vegetable oil, protein meal, livestock genetics , forest products, and dairy products. The payment guarantee to the U.S. exporter is for a minimum of 90 days and a maximum of one year. The guarantor banks in Côte d'Ivoire are Citibank, N.A and BICICI. The country limit for Côte d'Ivoire is USD 25 million. The GSM-102 program is generally available only to high quality importers with a good credit history and substantial assets with the guarantor bank.
5. Types of Available Export Financing and Insurance
For private sector projects, the Overseas Private Investment Corporation (OPIC), a Washington-based U.S. Government agency, offers U.S. exporter financing and insurance programs. OPIC's programs include loans, loan guarantees and insurance products. The Export Import Bank of the United States (Ex-Im Bank) does not lend to the public sector at this time. However, Ex-Im Bank financing is open for short-, medium-, and long-term private sector transactions. Ex-Im Bank's Direct Loan Program offers foreign buyers medium and long-term loans for up to 85 percent of the contract price at fixed interest rates for the purchase of U.S. capital equipment.
The U.S. Trade and Development Agency, the World Bank and the African Development Bank offer funds to finance feasibility studies and loans to finance Ivorian Government-sponsored procurement.
6. List of Banks with Correspondent U.S. Bank Arrangements
SGBCI Société Générale (SoGen) BIAO Credit Commercial de France (CCF) BICICI Banque Nationale de Paris (BNP) SIB Credit Lyonnais Citibank Citibank Paribas Paribas BHCI None Ecobank Chase Manhattan, and Bankers Trust Bank of Africa None HSBC Equator Bank HSBC Group
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[end of document] Note* International Copyright, United States Government, 1998 (or other year of first publication). All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title17, United States Code.
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