Home | News    Wednesday 21 November 2007

Lebanese banker triumphs in Sudan’s war-torn Darfur region


November 20, 2007 (KHARTOUM) — If there were an award for banker of the year in Sudan, where business carries on despite a four-year conflict in the western region of Darfur, it would go straight to Nadim Ghantous of Byblos Bank.

"Good management, little bad debt, perfect," says Wabel Abdallah, International Monetary Fund representative to Sudan’s central bank, describing the market’s view of Ghantous’s operation.

When Byblos Bank, Lebanon’s third, offered to send Ghantous to this country gripped by conflict, squeezed by a US embargo and run by a Islamo-military clique, he jumped at the chance.

"Instinctively I said yes, and I have no regrets," he told AFP.

The 45-year-old who moved to Khartoum in 2003 after living in Accra, Beirut, Quebec, Riyadh, Kuwait and New York admits that "Sudan is certainly not Switzerland, but over there I’d be bored to death!"

With a small team based in Khartoum, Ghantous created Byblos Africa in a business landscape that is Islamised and empty of big Western companies.

His new venture is 65-percent owned by the mother company in Lebanon.

The business plan forecast three years in the red. But after the first year, profits hit two million dollars and are expected to reach several million more in 2007, with an increase in capital from 12 to 25 million dollars.

A quarter of the company is soon to be floated on the stock market.

This performance came during an economic high in Sudan driven by an oil boom and hopes for a period of peace between north and south Sudan, even if not in Darfur where a civil war continues to rage.

"A feverish number of projects and consumer loans like never before," summarised Ghantous.

On the banks of the White Nile and Blue Nile, which meet in Khartoum, traffic jams testifying to the consumer spending spree have begun forming against a backdrop of cranes and scaffolding.

But since the end of 2006, the free-for-all received a knock from an unexpected drop in crude oil revenue, the production of which had reached 500,000 barrels a day.

In June the country almost ran out of foreign exchange reserves.

"Some banks had up to 60 percent in unpaid debt because of extremely risky loans," Ghantous said.

The largest of the 34 Sudanese banks, the state-owned Omdurman National Bank, is in a state of complete collapse, he said.

Sudan has two financial systems. There is the Islamic system in the north, where most banks, including Byblos, are based which rejects interest on loans. The other system is the "conventional" one in the predominantly Christian south.

"The problem with the Islamic banking system is that it doesn’t have the right refinancing instruments to deal with a crisis by helping punctual payers out of a temporary tight spot," Ghantous said.

So how to explain Byblos’s success?

Ghantous himself doesn’t say so explicitly, but the American embargo on dollar transactions has created opportunities as well as obstacles.

His bank, like the latest Lebanese arrival Audi, benefits from links with sister agencies in Europe, and even lends dollars or euros at high rates to Sudanese institutions.

And the crises continue, with a major split since October between north Sudan and former rebels in the south in spite a peace deal signed in 2005, while there is still no sign of a negotiated solution to the Darfur crisis.

Highlighting these risks, the respected Economist Analyst Unit is counting on a flow of investments and loans particularly from Asian countries like China, or Gulf Arab countries.

"I am by nature optimistic, things can only improve," insists Ghantous showing off the plans of the new 14-floor headquarters which should be ready in two years’ time.

As for his personal plans, "If my wife — my secret weapon — agrees then we will go elsewhere to take new risks."


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