WEST African countries of the eight-nation economic and monetary union are struggling to raise funds on the regional capital market, as investors demand higher interest rates amid tightening liquidity, financial market sources said.
Ivory Coast failed to issue local currency debt in March, while Senegal, Mali, Niger and Burkina Faso have cancelled or postponed bond issuance in recent weeks.
The failure to raise much-needed funds from the regional market may force states to look for alternative, cheaper financing sources such as the International Monetary Fund (IMF) to avoid budget shortfalls, the sources told Reuters.
“There is currently a serious liquidity crisis for states on the regional financial market. The interest rates offered do not reflect the reality of the market,” said Isidore Tanoe, director of Abidjan-based financial services firm Majoris Financial Group.
Tanoe said interest rates should be between 6.5% and 6.80%, instead of the 5.80% to 5.95% offered by
You’ve reached your free article limit
Subscribe to enjoy unlimited access to trusted journalism. Cancel anytime.
Subscribe nowNeed help? molokom@insidepolitic.co.za
