• WAEMU banks focus lending on commerce, services, manufacturing sectors
• Commerce leads with over $22B in short-term credit
• Senegal records highest credit volume, driven by infrastructure, energy 

Banks in the West African Economic and Monetary Union (WAEMU) are channeling most of their financing into three key sectors: commerce, community and household services, and manufacturing, according to data from the Central Bank of West African States (BCEAO).

The BCEAO's monthly statistical bulletin, which draws on credit usage reports from the central credit registry, highlights the dominance of these three sectors in the first quarter of 2025. Wholesale and retail trade, along with the hospitality and restaurant industry, were the primary beneficiaries of bank financing, receiving more than 12.39 trillion CFA francs ($22.15 billion) in short-term credit and 4.07 trillion CFA francs in medium and long-term loans. This significant allocation reflects commerce's central role in the union's economies, where it's a major driver of activity and a high-turnover capital sector.

The community, social, and personal services sector ranked second, with 4.64 trillion CFA francs in short-term credit and 11.74 trillion CFA francs in medium and long-term loans. The large volume of financing in this category reflects the rise of private services such as health, education, and leisure. It also explains the high prevalence of personal loans and public sector financing needs for administration and social infrastructure projects.

Manufacturing came in third, mobilizing 4.59 trillion CFA francs in short-term credit and 2.88 trillion CFA francs in medium and long-term loans. While this volume is substantial, it remains considerably lower than the financing provided to the commerce and services sectors. This disparity underscores the persistent challenges of industrialization in WAEMU, including low competitiveness and a reliance on imported intermediate goods. This dependency also exacerbates the fragility of the commercial sector, which, despite being the largest recipient of bank financing, remains vulnerable to external shocks, particularly shifts in global prices or demand slowdowns.

Regional Economic Momentum

These figures align with a period of strong regional economic momentum. The industrial production index rose by an average of 14.3% year-on-year in the first quarter, signaling a recovery across various subsectors, including agribusiness and construction materials. Commerce sales also grew by an average of 2%, confirming the driving role of domestic consumption. Additionally, inflation was contained at an average of 2%, well below the community's 3% target, while the average bank lending rate eased slightly from 6.8% in January to 6.7% in March. Although modest, this decrease has slightly reduced the cost of credit for businesses.

On a country-by-country basis, Senegal displayed the most dynamic credit activity by volume, with 7.13 trillion CFA francs in short-term credit and 8.61 trillion CFA francs in medium and long-term loans reported to the BCEAO's credit registry. This positive trend supports an economy that, despite current debt challenges, is buoyed by major infrastructure projects and expectations surrounding the upcoming start of oil and gas field production.

Moutiou Adjibi Nourou