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  • 1 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund

Title Page

WP/12/249

IMF Working paper

Financing Growth in the WAEMU Through the Regional Securities Market: Past Successes and Current Challenges

Mame Astou Diouf and François Boutin-Dufresne

Copyright Page

© 2012 International Monetary Fund

WP/12/249

IMF Working Paper

African Department

Financing Growth in the WAEMU through the Regional Securities Market: Past Successes and Current Challenges

Prepared by Mame Astou Diouf and François Boutin-Dufresne1

Authorized for distribution by Christina Daseking

October 2012

This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the authors and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the authors and are published to elicit comments and to further debate.

The West African Economic and Monetary Union (WAEMU) regional securities market saw increasing activity in the last decade, but still fell short of supplying sufficient long-term financing for growth-enhancing public and private investment projects. In addition to providing an institutional background, this paper studies recent developments and the determinants of interest rates on the market—using yield curve and principal component analyses. It also identifies challenges and prospective reforms that could help the region reap the full benefits of a more dynamic securities market and assesses the potential systemic risk the market may pose for the region’s banking system.

Contents

  • I. Introduction

  • II. Institutional Framework and Market Instruments

  • III. Recent Developments

  • IV. Determinants of Interest Rates: Yield Curve and Principal Component Analysis

  • V. Challenges Ahead

  • VI. Conclusion and Policy Recommendations

  • References

  • Annex 1. Issuers on the WAEMU Bond Market

  • Annex 2. Principal Component Analysis: Detailed Results for Government Securities Issued in 2010

  • Tables

  • Table 1. WAEMU: Government Debt Issues, 2010

  • Table 2. WAEMU: Issuance of Long-Term Securities, 1999–2010

  • Table 3. WAEMU Countries’ Sovereign Debt Ratings

  • Figures

  • Figure 1. Organigram of the WAEMU Securities Market

  • Figure 2. WAEMU: Issuance of Debt Securities, 2001–10

  • Figure 3. WAEMU: Determinants of T-bills’ Interest Rates, 2010

  • Figure 4. WAEMU: Government Issues Profiling Using Principal Component Analysis, 2010

Financing Growth in the WAEMU Through the Regional Securities Market: Past Successes and Current Challenges
Author: Mame Astou Diouf and Mr. Francois Boutin-Dufresne