MICROCAPITAL BRIEF: Central Bank of West African States, Islamic Corporation for the Development of the Private Sector to invest $30m in Small, Medium-sized Enterprises (SMEs)

Banque Centrale des Etats de L’Afrique (BCEAO), the central bank for eight West African countries, and the Islamic Corporation for the Development of the Private Sector (ICD), a development finance institution affiliated with the Saudi Arabia-based Islamic Development Bank, recently agreed to provide USD 30 million to small and medium-sized enterprises (SMEs) in the West African Economic and Monetary Union (WAEMU). This region includes Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo.

ICD will be responsible for providing capital in a newly created “Sharia compliant investment fund”. Furthermore, the organizations will try to attract investments from other institutions to increase the fund’s size to USD 100 million. BCEAO, in addition to providing incentives to invest, will be: (1) “conducting studies on support and coaching structures”; (2) “promoting complementary instruments tailored to the financing”.

As of September 2014, ICD reported total assets of USD 1.5 billion, return on assets (ROA) of 1.92 percent and return on equity (ROE) of 2.82 percent.

By Kevin van den Brink, Research Associate

About Banque Centrale des Etats de L’Afrique

The Banque Centrale des Etats de L’Afrique (BCEAO) is the regional central bank for eight member states which together form the West African Monetary Union. These states include Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. The BCEAO is a public international institution headquartered in Dakar, Senegal.

About the Islamic Corporation for the Development of the Private Sector (ICD)

The Islamic Corporation for the Development of the Private Sector (ICD) is a development finance institution that operates as part of the Saudi Arabia-based Islamic Development Bank (IBD). The corporation was founded in November 1999 to support the economic development of its 52 member countries by providing finance for private-sector projects, promoting competition and entrepreneurship, providing advisory services to governments and private companies, and encouraging cross-border investments. As of September 2014, ICD reported total assets of USD 1.5 billion, return on assets (ROA) of 1.92 percent and return on equity (ROE) of 2.82 percent.

Sources and Additional Resources

[1] Information provided by the African Press Organization

MicroCapital Universe Profile: Central Bank of West African States (BCEAO)

MicroCapital Universe Profile: Islamic Corporation for the Development private sector (ICD)

MicroCapital Universe Profile: Islamic Development Bank

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