SocGen to ease African trade
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Staff members welcome guests to a ceremony to mark the 50th anniversary of the Societe Generale de Banque headquarters in Abidjan, Cote d'Ivoire. The French bank has now opened yuan-denominated accounts to facilitate China-Africa trade. [Provided to China Daily]
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French bank Societe Generale SA is seeking to expand into Africa to tap the boom of Sino-African trade and the rapidly growing commercial activities of Chinese enterprises in the region.
While foreign banks remain highly regulated in China's domestic financial markets, the French bank is looking to capitalize on the rising demand for Chinese currency in African trade settlements.
Six banks in Africa, including SG-SSB in Ghana, Fina Bank Group in East Africa and Commercial Bank of Africa in Kenya, are currently in discussions with SG China to open yuan-denominated accounts.
So far, SG's Cote d'Ivoire subsidiary has already successfully opened yuan-denominated accounts, according to Harry Liu, head of commercial banking at Societe Generale China.
"As Chinese companies go to Africa, they will need supporting banking services and it will take some time for Chinese banks to build their networks in Africa. Such demands will create opportunities for foreign banks in China, especially for those who have a strong network presence there," he said.
SG has one of the largest networks in Africa among European banks. It operates 870 branches in 15 African countries, according to Liu.
Leveraging on its extensive network in Africa, the French bank has been able to access the growing business activities of Chinese companies that are engaged in various sectors including energy, infrastructure, agriculture, telecommunications and manufacturing.
The bank is now providing financial services - including import and export financing, bond issuances and bank guarantees - to its Chinese clients in Africa, especially in the northwestern part of the continent, Liu said.
He said that SG has especially benefited from the rapid growth of Sino-African trade, and the fact that Africa has started to develop an appetite for yuan-denominated financial products.
Trade between China and Africa reached a record high of $198.5 billion last year, according to the Ministry of Commerce. Trade is expected to hit $325 billion by 2015, providing a strong base for growth in yuan trade settlements and yuan-denominated bonds.
