Africa Leaders Magazine

SERGE EKUÉ – Chairman of the Board and President of the West African Development Bank (BOAD)

SERGE EKUÉ - Chairman of the Board and President of the West African Development Bank (BOAD) - African Leaders Magazine

The new head of the West African Development Bank (BOAD), based in Togo, Serge Ekué is bringing fresh dynamism and impetus to development finance. He’s quickly become an important voice on African affairs bringing a new approach to development banks and investing on the continent.

Colleagues at the French corporate and investment bank Natixis, where he used to head market activities in the Asia-Pacific Region before becoming the head of the UK office, describe him as humble, approachable and supportive. A hard worker and a well-polished banker, he was known for his strong values and being genuine.

When the opportunity to return to the continent came, he jumped at the chance despite a distinguished career that could have seen him rise even further in the global world of investment banking.

SERGE EKUÉ - Chairman of the Board and President of the West African Development Bank (BOAD) - African Leaders Magazine

In the short time he’s been at the bank, he’s brought a very commercial and pragmatic vision; he is happy to think differently around the challenges and offer new solutions.

He represents the new breed of business leaders and bankers, assured and with a clear vision of what is possible. Respected internationally because he speaks their language, he has also the tact and intelligence that makes his message resonate in the ministries and spheres in which he operates.

Since his arrival at the head of the institution in August 2020 – a strategic plan (“Djoliba” plan) which includes a capital increase of 1 .5 billion dollars. He has just taken the first step by winning the agreement of the shareholders. In this interview with La Tribune Afrique, UEMOA’s main development financier based in Lomé (Togo) discusses this news, referring in particular to the specific case of Mali, but also his investment philosophy in times of crisis, the subject special drawing rights (SDR) or the value of PPPs in the context of economic recovery.

“BOAD is a house of doers and not of tellers,” says Serge Ekué, President of the West African Development Bank (BOAD).

In a sit down with La Tribune Afrique, he had to this to say;

SERGE EKUÉ - Chairman of the Board and President of the West African Development Bank (BOAD) - African Leaders Magazine

LA TRIBUNE AFRIQUE – BOAD has just taken the first step towards its recapitalization. What does this mean for you, who initiated this project as soon as you took over the presidency of the Bank?

SERGE EKUE – The subject of the capital increase was at the heart of all the battles at BOAD and I think history proves us right. Today, the observation is that our bank should have sufficient capital to be able to raise debt and effectively finance development. We will have better shock absorption capacity, therefore greater resilience in the future.

We can clearly see that the situation in the region has deteriorated fairly quickly, particularly with the cases of Mali and Burkina Faso. Very clearly, the Bank’s capital increase offers an additional stabilizing factor at the heart of this crisis in our region. am very precise on these terms-, of the situation.

Furthermore, the development challenges of the African continent in general and of our zone in particular introduce us to an emergency situation. The West African population today is 110 to 120 million. We will double in population in 25 years, with an average age of 20 years. To cope with this demographic growth, the needs in terms of financial resources are massive. In terms of energy alone, the funding gap over the next few years is 100 billion dollars annually for infrastructure in general on the continent.

Faced with this emergency situation, it is for us to accelerate our action. This is why the first decision I made when I took over as head of BOAD was to focus our efforts on our capital increase.

West Africa is indeed experiencing a particular situation. Member countries are the first to make commitments for this capital increase. But what about Mali which is under sanctions?

The thing is not simple. When we are working on a debt operation, it is very simple. But an equity transaction is more complex, because it incorporates a process of validation, subscription and release of capital which is specific to each shareholder. The first step was to work on the subscription in order to obtain shareholder support for our capital increase plan.

Today, we are working with each country to define the terms of release. In some states, this will go through the finance law debated sometimes in the National Assembly sometimes in Parliament. So, it will take a bit of time. Each country will proceed according to its own provisions.

Mali is now under sanctions; we cannot look at this file with them. On the other hand, Mali had given us its agreement before the sanctions were taken. When these are lifted, we will naturally resume the process. I insist on the fact that what is important are the intentions expressed by each shareholder. And from this point of view, with one exception, which is India, all the shareholders have given us their support.

Regarding non-regional shareholders, the African Development Bank (AfDB), France and Morocco plan to subscribe from this year 2022. Can you tell us a little more?

We have category A shareholders who are the countries of the zone, plus the Central Bank of West African States (BCEAO). We also have category B shareholders who are non-regional, including France, which has effectively passed our capital increase by vote in its finance law this year. The African Development Bank (AfDB) also submitted the capital increase to the Board of Governors, which was validated. We are in the process of finalizing our agreement with the Kingdom of Morocco.

SERGE EKUÉ - Chairman of the Board and President of the West African Development Bank (BOAD) - African Leaders Magazine

The world is going through an unprecedented crisis for two years following the Covid-19 pandemic. In West Africa, how has this crisis influenced your investment philosophy?

The crisis we are going through constitutes an exogenous shock. Certainly, in our business, economic shocks are not necessarily predictable, but the previous crises of 1995, 1999, that of the subprimes in 2008, that of the euro in 2011… and now the Covid-19, bear witness to that economic and financial life is not a long calm river.

We consider that this crisis has more than ever highlighted the problems of health and education in our region in particular. And one of the first commitments made at the last African Union – European Union Summit, focused on the public health challenge more generally with the creation of regional hubs for vaccines and messenger RNAs, in particular the question of home production of vaccines, not only for Covid-19, but also for other viruses.

The second point is that of agriculture. This crisis has completely destabilized supply chains around the world and we are still suffering the consequences today. Transport prices have risen substantially. We can discuss the impact on inflation, but that is another subject. From the moment the borders were closed, the countries of our region found themselves cut off from the world overnight. Thus, the real lesson to be learned from the crisis is that domestic production must be given priority, in order to avoid being subjected to the destabilization of global supply chains. It therefore goes without saying that BOAD will play its part in supporting the health, agriculture, education, infrastructure and

In the current context, there is really a lot to work on in an idea of ​​urgent acceleration. We don’t have much time to contemplate things, we have to act. When the Central Bank thought about the creation of BOAD, it was in terms of a development financing instrument. Current events push us to do things and to do them quickly. BOAD is a house of doers and not of tellers.

The AU-EU Summit that you mentioned earlier was an opportunity for African and European leaders to come back to key development issues such as the Special Drawing Rights (SDRs) of the International Monetary Fund (IMF). To the 650 billion dollars granted to Africa, the continent, after claiming an increase, obtained a promise of an additional 100 billion. At this point, what’s your point about DTS?

We defend the idea that we must find all the ways and means that will allow the African continent to have the means for its development. This is the message that we convey at the international level and which we echoed at the African Union-European Union Summit in Brussels. We again support the idea of ​​redirecting Special Drawing Rights to the benefit of development banks. We have found alternative solutions, but it was indeed important that the volume of SDRs be increased for the benefit of the African continent in general and for the benefit of West Africa in particular. Originally, debates were held around the 33 billion dollars of SDRs, before granting an additional 100 billion. As we speak,

At BOAD, we have set up an organization targeting five priority sectors which are basic development sectors, namely infrastructure, energy, agriculture, real estate, in particular social housing, health and education. We must continue to ensure that these issues are resolved. And our bank aims to seek resources, and to dedicate them to the needs of populations. We need to get to what I was saying at the start: closing the financing gap in order to respond effectively to the needs of a growing population. This is fundamental.

SERGE EKUÉ - Chairman of the Board and President of the West African Development Bank (BOAD) - African Leaders Magazine

In the current context, and apart from their commitment to increase the Bank’s capital, do you have any expectations vis-à-vis governments?

We are a bank very involved in our relations with the sovereign sector, our main direct or indirect shareholders being the States in our zone. We also have a very strong relationship with the private sector – especially SMEs and SMIs – which we support through commercial banks. The way our economies are evolving means that we are now reaching a point where the private sector must gradually take over from the sovereign sector. The public sector must play its part in major infrastructures, but it is clear that the concept of Public-Private Partnership (PPP) is developing a lot. We are in an area where the sovereign today,

BOAD is therefore part of this movement. It is the emergence of customer culture. This term means a lot to me: since it concerns clients, whatever keeps them awake at night must also keep me awake.

source: newafricanmagazine.com / afrique.latribune.f

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