The impact of the financial crisis and the state of financial sector development in North Africa – these were the topics that Issa Faye of the African Development Bank’s research department presented at the “Financing Africa” consultation workshop held during the just-concluded African Economic Conference (AEC) in Tunis.
Mr. Faye, one of four authors of the book “Financing Africa: Through the Crisis and Beyond”, which will be published in 2011, pointed out the main barriers the financial sector was facing, as well as possible reforms to foster its development in the Maghreb. He cited access to finance and high costs of loans as major problems for the sector’s development, with initiatives by some banks to reach out to a presumably “unbankable” population showing encouraging results. Contrary to what one might expect, Islamic finance does not play, for the moment, an important role in Maghreb countries, the author said.
The findings presented at the session were discussed among the panelists, which included experts on financial sector development from the Maghreb. The event was the first in a series of five consultative meetings where the authors meet with stakeholders to present and discuss their findings prior to finalization and publication.
“Financing Africa” is a follow-up to “Making Finance Work for Africa” which, published in early 2007, had a critical impact on the financial sector debate across the continent, as it drew attention to the low level of financial depth in Sub-Saharan Africa. But since its publication, the African financial landscape has changed significantly. The financial crisis has affected the continent’s economies, and innovative approaches and new technologies are offering opportunities to increase financial access around the continent overcoming infrastructure barriers. “Financing Africa: through the Crisis and Beyond” takes into account changes that have occurred over the past three years and expands the analysis of the first book.
The book is a product of collaboration among donors, which was enabled and partially funded by the MFW4A secretariat. Three development partners; the AfDB, the World Bank and the German Development Corporation BMZ, and four authors – Thorsten Beck, Samuel Munzele Maimbo, Thouraya Triki and Issa Faye – jointly worked on the publication. For the MFW4A initiative, this publication will represent a new milestone, as the principal findings will inform future activities and address priority areas.
The MFW4A Partnership was created to support efforts by African countries to accelerate economic growth and reduce poverty by facilitating financial sector development. With this in mind, the partnership’s objective is to serve as a platform for joint action among local stakeholders, development partners, private sector actors, and civil society organizations. It provides a joint framework for coordination, communication, and alignment with country development strategies. It facilitates knowledge exchange and generation by bringing together the experience and expertise of donors and stakeholders. It serves as a catalyst for joint diagnostic work, and as a repository of existing knowledge.
The consultation, chaired by the AfDB Chief Economist, Mthuli Ncube, was opened by the Making Finance Work for Africa (MFW4A) Partnership Coordinator, Stefan Nalletamby.