Cross-border banking fosters Africa growth

The banking industry has put its money where its mouth is in terms of investment in Africa – and that’s good news for economic expansion. “Both local and international banks are increasingly focused on the opportunities African growth can give them,” said Janine Myburgh, president of the Cape Chamber of Commerce and Industry. “Bankers and government officials believe that as ordinary workers gain access to basic banking facilities, and the emerging middle classes access more sophisticated financial services, there should be a feedback loop to greater spending and consumption, and hence further economic expansion,” she said. Speaking at the third Doing Business in Africa seminar organised by the Cape Chamber and aimed at growing Western Cape exporting into Africa, Myburgh said financial institutions seemed to be far more committed to the region and its success than many other sectors. “Cross-border banking will have significant benefits for companies looking to expand their African operations,” she said. And she believes now is the time, with Nigeria having rebased its figures for gross domestic product in April this year and overtaken South Africa as the biggest economy on the continent – coupled with the downgrading of South Africa by several international organisations. “Bloomberg economist, Jim O’Neill, recently pointed out that the whole of Africa had an annual output of only perhaps $2 trillion, which was comparable to India or Russia. “And yet, despite this, the region is viewed as the global investment darling,” Myburgh said. “Despite the slightly gloomy South African picture, we must take the opportunities north of our borders more seriously.” INSERT & CAPTION Financial institutions seem to be far more committed to the region and its success than many other sectors. – Janine Myburgh