African social media are filled with reports that Burkina Faso’s President Ibrahim Traoré rejected a proposed conclusion of an International Monetary Fund Extended Credit Facility (ECF) in August. While this has not been confirmed by the IMF, there is an agreement that has been drafted, accepted by the IMF board, but there has been no announcement that it had been signed by the government of Burkina Faso.
Parallel to the negotiations with the IMF, the government in August created the Treasury Deposit Bank (BDT), on Aug. 2, 2024, headquartered in the Public Treasury in Koulouba. This followed the failure of local banks and financial institutions to accept requests by President Traoré to step up lending to small and medium-size enterprises.
The Treasury has offices throughout the country, at almost every level; it already has the infrastructure to provide banking services. It seems to be modeled after the “Post Banks” that were created in some European countries, and that were managed under the post offices.
According to a government communiqué, “The Treasury Deposit Bank, a public financial institution, is open to public institutions, State Companies and State Public Establishments, Projects and Programs, local authorities, international organizations, private companies, associations and NGOs as well as individuals…. The commissioning of the Treasury Deposit Bank, through the banking services offered, will help meet the personal and professional needs of customers.”
According to media reports, the government, along with that of Mali and Niger, are considering leaving the CFA Franc of the West African Monetary Union, which comprises Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo. The Central Bank of West African States (BCEAO), headquartered in Dakar, Senegal, serves as the central bank for all the states. This was created by France, the former colonialist power. There is even talk of the three countries creating a gold-backed currency, since Mali and Burkina Faso are respectively Africa’s third- and fourth-largest gold producers. Burkina Faso has just built the country’s first gold refinery, and is scheduled to produce its first bar of gold this month.
