Paper
The Implications of WTO and GATS for the Banking Sector in Africa
What is the likely impactsof global trade and services regulation on the banking industry in Africa?
27 pages
This paper assesses the implications of the World Trade Organisation (WTO) and the General Agreement on Trade in Services (GATS) for the banking sector in African countries that are signatories to the WTO and GATS protocols. With emphasis on the "free trade" element and the implications for full liberalization of the banking sector, it:
- Reviews the relevant provisions of the GATS for banking services and the main exemptions held by African countries;
- Analyses the main efficiency indicators of a sample of the top banks in 18 African economies for the period 1997-1998;
- Examines the pricing of banking services and uses univariate statistics to analyse the dispersion of the key banking and liquidity indicators in these economies for the period 1994-1998.
The authors finding imply substantial shake-up of the African banking industry but suggest that banks in most African countries have little to fear from liberalization - at least in terms of the continuing existence of a locally owned banking industry. Banks can expect to be able to restructure and compete in African-wide or regional markets.
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