A. Basu, R. Blavy, and M. Yulek, “Microfinance in Africa: Experience and Lessons from selected African Countries,” IMF Working Paper 04/174 (Washington: International Monetary Fund).
J. Christensen, 2004,“Domestic Debt Markets in Sub-Saharan Africa,” IMF Working Paper 04/46 (Washington: International Monetary Fund).
C. Cottarelli, G. Dell’Ariccia, and I. Vladkova-Heller, “Early Birds, Late Risers, and Sleeping Beauties: Bank Credit Growth to the Private Sector in Central and Eastern Europe and the Balkans,” IMF Working Paper 03/213 (Washington: International Monetary Fund).
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)| false “ C. Cottarelli, G. Dell’Ariccia, and I. Vladkova-Heller, Early Birds, Late Risers, and Sleeping Beauties: Bank Credit Growth to the Private Sector in Central and Eastern Europe and the Balkans,” IMF Working Paper 03/213 ( Washington: International Monetary Fund).
P. Hilbers, I. Otker-Robe, C. Pazarbasioglu, and G. Johnsen, “Benign or Malignant: Assessing and Managing Rapid Credit Growth and the Role of Supervisory and Prudential Policies” (unpublished, Washington: International Monetary Fund).
International Monetary Fund, 2005, The Federal Democratic Republic of Ethiopia, Selected Issue and Statistical Appendix, IMF Country Report 05/28 (Washington).
International Monetary Fund, 2005, Senegal, Financial System Stability Assessment Update, IMF Country Report 05/126 (Washington).
I am grateful to Robert Corker for useful comments and suggestions, to participants at the IMF’s African Department seminar for helpful discussions, and to Naly Carvalho and Bakar Ould-Abdallah for excellent research assistance.
Securitized government debt includes treasury bills, development bonds, and other bonds. The data exclude direct advances from central banks and commercial banks.
In Ethiopia the rising ratio between 2000 and 2003 of bank credit to government to deposits reflects has not been a cause of crowding out, but rather is the consequence of the high liquidity of the banks, which have been offered an outlet for investment by the government in form of government securities.
Large bank restructuring at significant cost took place in Senegal in 1988-89, Côte d’Ivoire 1988-89, Benin 1988-89, Mali 1989, Niger 1989-90, Nigeria in the late 1980s, Cameroon 1990-97, Kenya 1993-94 and 1998, Madagascar 1996-98, and Tanzania 1996-99. The restructuring process is continuing in Kenya, Tanzania and Zambia. High NPLs, with inadequate provisioning, persist in Ghana; however these adverse factors are cushioned by a wide interest rate spread, leading to comfortable profits for the banking system.
For an analysis of the factors explaining rapid credit growth in the region see Cottarelli, Dell’Arriccia and Vlakova-Hollar (2003) and Hilbers, Otker-Rober, Pazarbasioglu and Johnsen (2005).
Examples in this area are initiatives taken in Benin, Tanzania, and Gabon. In many countries much of the real property, even in cities, is not formally registered, i.e. is not formalized by a title; this is the case for instance in Senegal and Côte d’Ivoire, among others.
The law is in the process to be revised to allow foreign banks to hold real estate property, acquired in foreclosures, for a limited period of time.
They include the requirement that mortgages be approved by the Land Commissioner.
This has been noted in the Financial Systems Stability Assessment (FSSA) reports for Senegal, Mozambique, Uganda and Tanzania (see references).
A recommendation to overhaul Uganda’s formal insolvency system has been Submitted in September 2004 by the Uganda Law Reform Commission.
The weaknesses in the treatment of leases in Tanzania and Kenya have been highlighted in the recent Financial System Stability Assessment (FSSA) reports for these countries.
It is to be noted that in Cameroon, a country with an extensive network of MFIs, these have played an important role in SME financing for many years.
Benin, Burkina Faso, Chad, Mali, Niger, Senegal, and Togo.
The credit mechanism managed by the CSPR is constituted by two steps. First, when the agricultural campaign starts in February, ginning operators pay 40 percent of the value of their pre-agreed quotas of cotton to the CSPR. This part is put aside to repay the dealers which have financed the purchase of inputs for the previous campaign, and/or directly their commercial banks. At the end of the agricultural campaign in December, producers deliver their cotton production to the ginners, and receive, through the CSPR, the payment of the 60 percent value of their production, corresponding to the part that accrue to them after deducting the cost of inputs.
Data for Burkina Faso, Mali, and Côte d’Ivoire originate from a sample of credit unions monitored by the BCEAO, which account for about 90 percent of total credit union operations in these countries.
See International Monetary Fund (2005), The Federal Democratic Republic of Ethiopia, Selected Issue and Statistical Appendix.