Finance

On the back of a rise in both capital investment and transport activity, Djibouti’s banking sector has seen considerable expansion in recent years. The most visible change has been the increase in the number of players in the market, which has led to an uptick in competitiveness and the expansion of products and services targeting local clients.

The increasingly robust regulatory role that is being adopted by the Central Bank of Djibouti (Banque Centrale de Djibouti, BCD) has led to the promulgation of various new rules – ranging from risk assessment frameworks and sharia compli-ance to regulations for new payment systems – which should help pave the way for increased retail and corporate activity.

Although some vulnerabilities persist, as evi-denced by the increase in non-performing loans, the country’s banking sector is overall in compar-atively healthy shape, and should benefit from the government’s efforts to increase foreign direct investment and promote diversification.