It covers payment methods and information on, banking systems, foreign exchange controls, and U.S. and correspondent banking.
Methods of Payment
Traditional trade finance instruments such as letters of credit, collections, and funds transfers are available to exporters, though the associated fees are high in Côte d’Ivoire compared to those of other countries in the region. For example, Ivoirian banks typically charge one to three percent of the transaction value, while Burkinabe and Malian banks charge half a percent to two percent of the transaction value. If a letter of credit is chosen, the exporter should require an “irrevocable, confirmed letter of credit” to ensure prompt, reliable payment. The United States Department of Agriculture’s (USDA) West Africa Regional GSM-102 Credit Guarantee Program is an export finance solution that supports sales of U.S. agricultural products in overseas markets and helps U.S companies export with confidence of payment. The program guarantees credit extended by the private financial sector in the United States (or, less commonly, by the U.S. exporter) to approved foreign financial institutions using dollar-denominated, irrevocable letters of credit for purchases of U.S. food and agricultural products by foreign importers. The program can expand credit lines to correspondent non-US banks with minimal added risk. The payment guarantee to the U.S. exporter is for a minimum of 90 days and a maximum of 18 months.
For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide.
The banking sector in Côte d’Ivoire is highly competitive and Abidjan’s importance as a financial center in West Africa is growing. The BCEAO reported that, as of the end of 2020, there are 29 banks in Côte d’Ivoire, many with branches throughout the country. The total number of bank branches has more than doubled from 324 in 2010 to 725 in 2019 (latest data available). Most Ivoirian banks are compliant with the BCEAO’s minimum capital requirements. Some public banks have large numbers of nonperforming loans. The government has been restructuring and privatizing the commercial banking sector over the past decade in order to remove low performers from government accounts.
Foreign banks are allowed to establish operations in Côte d’Ivoire. They are subject to prudential measures and regulations of the Banking Commission of the WAEMU.
Foreign Exchange Controls
There are no restrictions on the transfer or repatriation of capital and income earned, or on investments financed with convertible foreign currency. Once an investment is established and documented, the government regularly approves remittances of dividends and/or repatriation of capital. The same holds true for requests for other sorts of transactions (e.g. imports, licenses, and royalty fees). Some companies have reported delays of up to two weeks when using the BCEAO to convert funds from CFA to another currency.
Funds associated with investments funded with convertible currency can be converted into any world currency. Côte d’Ivoire uses the West African Franc, official currency symbol denoted as XOF and referred to in writing as CFA. The French Treasury supports the fixed exchange rate of 655.956 CFA to the Euro. In December 2019, the Ivoirian President and French President announced the forthcoming transition from the CFA to another common regional currency to be called the Eco. In May 2020, the French legislature passed a law ending the requirement for the French treasury to hold half of the BCEAO’s reserves.
LOCAL Banks & U.S. Correspondent Banks