Country Focus

Comoros

Comoros: Financial Sector Profile

Comoros is emerging from a long period of political instability punctuated by at least twenty violent transfers of presidential powers since independence from France in 1975. Only now is the country painstakingly making its way towards economic reconciliation and economic normalcy.

The country’s growth record has been poor, with GDP growth averaging 1.3 percent between 2004 and 2009, well below the regional average, and per capita income steadily declining. Economic activity is largely confined to subsistence agriculture, three export crops, import-related commerce, and government services.

Fiscal policy is constrained by erratic fiscal revenues, a bloated civil service wage bill, and an external debt that is far above the HIPC threshold. Membership in the franc zone, the main anchor of stability, has nevertheless helped contain pressures on domestic prices.

Comoros has a relatively small financial sector. It presently comprises the Central Bank, two commercial banks (the largest of which, Banque pour l’Industrie et le Commerce des Comores, is owned by BNP Paribas), a development bank, and two networks of MFIs (the Mecks and the Sanduks). In addition, there is a National Savings Fund, the Caisse Nationale d’Epargne, affiliated with the government-owned Postal and Telecommunication Company (SNPT).

According to 2005 data, the Mecks and the Sanduks, the two microfinance networks, reach 55,480 members and have a network of 83 units on the three islands, with a market share of 31 percent deposits and credit.

Authorities have undertaken efforts to enhance financial intermediation – such as the facilitation of entry for foreign banks, two of which have recently been granted licenses – and to strengthen bank supervision and licensing.

No stock market is present in the country, nor are there primary or secondary markets for government or private commercial debt. Government financing is mostly undertaken in the form of direct credit from the domestic commercial banks, and liquidity levels are controlled through the modification of reserve requirements only.

At 24 percent of GDP, remittances constitute an important source of inflows for the Comorian economy.

Financial Sector Development Indicators
  2003 2004 2005 2006 2007
Private Credit/GDP (%) n.a. n.a. n.a. n.a. n.a.
Stock Market Cap/GDP (%) n.a. n.a. n.a. n.a. n.a.
Liquid Liabilities (2000 USD ml) 52 50 50 50 52
Net Interest Margin (%) n.a. n.a. n.a. n.a. n.a.
Remittances/GDP (%) 4 3 3 3 3
GDP (USD ml, current prices) 325 363 388 404 466
Branches per 100,000 inhabitants n.a. n.a. n.a. n.a. n.a.

For statistical coherence and comparability purposes, the FSDIs are extrapolated from a limited number of sources (AfDB, IMF, OECD, WB), where a common data collection methodology was applied to all countries surveyed. For additional data from other sources, please refer to the Documents section.