INTERVIEW WITH THE GENERAL DIRECTOR OF FAGACE
INTERVIEW WITH MR NGUETO YAMBAYE, GENERAL DIRECTOR OF FAGACE IN THE JOURNAL L’ECONOMISTE OF JULY 15, 2021 “THE ECONOMIC SITUATION OF OUR COUNTRIES CALLS FOR MORE SUPPORT”
Tell us about FAGACE
The African Guarantee and Economic Cooperation Fund (FAGACE) is an international financial institution specializing in the promotion of public and private investments. Since its creation in 1977, the Fund’s interventions have made it possible to mobilize more than 2,500 billion CFA Francs for the benefit of the economies of its fourteen (14) member states, thanks to the guarantee of bank loans and its various interventions.
It should be remembered that FAGACE is a pioneer in the field of bank guarantees in Africa. The Fund has demonstrated resilience, staying the course and meeting challenges throughout its last forty-four years. Today, it is beginning a new era of transformations to be more in line with developments in the financial market and the expectations of the economies of the Member States. This is why upon my accession to General Management in 2020, the priority was to reach an agreement with the Member States on a new strategic framework. Thus, through the new 2021-2025 Strategic Plan approved by the Council of Governors which are the Finance Ministers of the member states, important measures have been taken to make structural changes and to increase the performance and influence of the Fund.
What can we learn from FAGACE’s new directions?
The 2021-2025 Strategic Plan is the product of internal reflection by FAGACE Experts challenged by external experts. Through this Plan, our vision is to make FAGACE a modern institution that fully contributes to the financial integration of Africa.
Our new strategy will be based on the main pillars which are: innovation, strengthening the financial structure by opening capital to new States and financial partners, the integration of African markets, the pursuit of reforms to make the FAGACE more modern, more competitive and more attractive to the markets.
Furthermore, FAGACE intends to make local interventions in its member states such as Benin with a view to supporting investment financing and thus meeting the challenges of growth and employment. This will notably involve multifaceted support in the context of project financing, notably public projects, PPPs, private sector projects, diversified interventions which will be increased to meet the needs of the economies.
We notice that many partnerships have been established by FAGACE in recent times. What are the intended objectives?
As you know, the economic situation in our countries calls for greater support. Our States expect a lot from development institutions like FAGACE and more impact. One way to do this is to have financial and development institutions work together and create more synergies.
It is within this framework that several agreements have been signed in recent months, notably with Institutions such as BADEA, ETC, BLEND, KARA Investment Fund, FIGA, TECHNOSERVE, and several African banking groups) but also with the Governments of Chad , Guinea Bissau, Mali and discussions continue.
This dynamic will continue over the next five (5) years, in line with the directions of the Strategic Plan.
From now on, proximity with development institutions and member states will strengthen and diversify.
Joint interventions in various sectors will make it possible to positively impact the development of our States. Likewise, the collaboration will extend to aspects of resource mobilization, project identification, exchange of experiences, capacity building, structuring of operations, support and advice to project leaders as well as to Member States.
The new challenges
Among the major challenges, I would like to cite the health crisis linked to the COVID-19 pandemic and has called into question the growth prospects of our countries, our economies and our businesses. In this context, the economic challenges are enormous. FAGACE, like other institutions, offers, in addition to the measures taken by central banks and governments, solutions adapted to banks to contain the uncertainties that the pandemic is confronting economies. Thus our risk sharing solution makes it easier to restructure credits that have become less efficient and to support them by mitigating the deterioration of the perceived risk in relation to companies in the face of diminishing mobilization capacities. Emphasis will also be placed on guaranteeing specific financing lines adapted to each sector in order to facilitate the mobilization of adequate resources to finance the economy.
Furthermore, the launch of the ZLECAF remains an opportunity to boost inter-African trade by highlighting the place of guarantees in the financial ecosystem. FAGACE intends to capitalize on its assets, experience and expertise to better support this laudable initiative, which is beneficial for the entire continent.
Perspectives :
FAGACE intends to strengthen its collaboration with other Guarantee Funds and International Financial Institutions in order to channel the maximum resources into our member countries and better support development projects that create jobs and wealth. To do this, a synergy of actors is essential in order to facilitate the structuring of financing, to emphasize financial engineering, and to popularize the guarantee profession to make it more accessible to the different actors in the financial ecosystem.
Conclusion (Final remarks from the CEO)
Before finishing, I would first like to thank the Journal l’Economiste for this interview.
As you know, FAGACE has undergone positive transformations in recent years, reflected in a refocusing of the product offering around the guarantee, a strengthening of the governance of the Fund with a renewed Board of Directors but also committees and a framework. prudential in line with international standards. It is, among other things, the combination of these principles and the good financial situation of FAGACE which has displayed positive results for three (3) years which also enabled it to obtain from the international rating agency Bloomfield in 2019, the “A-” short-term and “A2” long-term ratings with a stable outlook.
All these measures constitute a signal to technical and financial partners, for fruitful cooperation for the benefit of Member States.
The objective of FAGACE is to positively impact the development of our States and in this case the development of Benin.
To conclude, allow me to take this opportunity to thank the Beninese authorities at various levels for their unwavering support to FAGACE. Benin being the headquarters country, our ambition is to further contribute to the country’s National Development Plan.
