Gapejarbeda
Since the early 1990s home- grown cross-border business coalitions have begun to change the perception and realities of West Africa’s trading environment. These changes, complex and far-reaching at once, have the potential to raze the barriers of currency divide between the West African countries ruled in colonial times by France, the Francophone, and those ruled by England, the Anglophone. Fifty odd years into independence , this colonial hangover continues to disrupt the development of trade and its gains among West African states.
Since independence, a mindless post-colonial Anglophone/Francophone rivalry stymied state-led efforts to increase intra-West African trade. It also was responsible for the inability of West African states to create a regional bank, until the Federation of West African Chambers of Commerce and Industry decided to fill this vacuum in 1985 with the founding of Ecobank Transnational Incorporated (ETI), a regional investment bank. Before the Ecobank began operation in 1988 in Lomé, Togo, the banking industry in the sub-region was dominated by foreign and state-owned banks. There were hardly any commercial banks owned and managed entirely by the African private sector. Today, Ecobank International is Africa’s sixth-largest banking institution, and probably the first West African multinational corporation with subsidiaries and branches in 30 African countries. This is integration in action, not words.
While governments continue to pay lip service to regional integration, Ecobank has transformed from a regional bank to a Pan-African bank fostering along the way, the speedy integration of sovereign states in the region. It has busted cross-border colonial walls against intra-regional business and people interactions, and has defied distances to grow participating West African businesses.
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The result has been an emerging revolution in the financial services industry that has become the pillar of development in the sub-region, and across Africa. Ecobank now operates a regional health and auto insurance, a regional clearinghouse, and customs nomenclatures currently adopted by most member states of ECOWAS. The bank is also the primary issuer of the sub-region’s travelers’ checks (introduced in 2000,) as well as the complementary ECOWAS Travel Certificate presently in circulation in eight member states. That’s integration with great potential for the bottom line. And this has not gone unnoticed. Over the past five years, Nigerian banks Bank PHB, Zenith, Guranty Trust, Intercontinental, Access, First International, and Oceanic have followed on the trails of Ecobank.
They have gone on an unprecedented acquisition spree of formerly government controlled banks and other financial institutions all over West Africa, linking them up with bigger banks at home and in the region. Predictably, entrepreneurs, tourists, and all manner of fortune-seekers have not been left behind. Indigenous West African Business led by Nigerian businessmen and women are creating before our eyes a level of interaction among the peoples of West Africa that governments and international organizations can only dream about. Yet, cross-border regional banking should not in any way be seen as Nigerian monopoly.
In 2007, the International Bank of Liberia Limited re-capitalized up to US$3.5 million with capital input from three major shareholders, namely the Trust Bank of Gambia, Databank Financial Services of Ghana, and Pan African Capital of the United States. The Trust Bank of Gambia itself cross-listed on the Ghana Stock Exchange in 2002, a decision that led to an increase in its market capitalization from US$15 to over US$80 million. There are other great examples, but the point to note is that thanks to the efforts of the private sector, the burdens of regional payment systems that prevented meaningful intra-West African trade appears to be over.
Just last week, the Nigeria-led West African Monetary Zone postponed yet again the introduction of its regional currency first proposed in 2000. But that seems almost blasé to many West African peoples who already have access to their funds anywhere in the sub-region because of new developments in cross-border banking services.
There is the availability of automated teller machines (ATMs) in all the major commercial centers of the sub-region. There is the variety of multiple-currency card schemes. Through Ecobank and other regional bank ATMs, holders of debit cards are now able to travel across the region with only one card that makes it possible for them to access local currencies in 14 countries.
Again, West African governments deserve praise for creating the environment for the private sector to craft this level of integration of the sub-region. The highly innovative Real Time Gross Settlement (RTGS) payments system now operative in all ECOWAS countries could not have happened without the helpful hands of West African states. The RTGS allows financial intermediaries to settle inter-bank transfers in real time. Other innovative products developed by Nigerian banks include Intercontinental Bank’s business friendly eTransact, and I-Cash Mobile that allow a Nigerian in Ghana, for instance, to withdraw his money in cedis using an I-Mobile re-loadable card.
More than growing the volume of trade among the states in the region, the Nigerian-led cross-boarder banking is becoming a major symbol of cross-national identity-formation that is finally eating away on old colonial barriers to bottom-up regionalization. This means that the funeral of currency nationalism in West Africa may be just around the corner and we, needless to jubilate, approve of it!
