Cameroon’s economic growth remains promising

The October 2015, Regional Economic Outlook was launched in a workshop in Yaounde yesterday.

The second edition of the Regional Economic Outlook of the International Monetary Fund, IMF, has been published, with projections revealing that growth in Cameroon will remain at plus 5 per cent in 2015. The report says though the environment in Sub-Saharan Africa is deteriorating with figures revealing that growth will remain at below 4 per cent, Cameroon has succeeded to stand shocks by diversifying its economy.

The IMF report states that the oil price drop is now significant. The situation is compounded by the difficulty to source cheap funding in the international capital market. Security risks with many countries of the sub-region facing the challenge of terrorists threats, have again come to the fore.

Notwithstanding, Cameroon since the Spring 2015 report, published in April this year, has been able to face headwings. Experts at the Yaounde ceremony yesterday December 7, 2015 to present the IMF report attribute the resilience to Cameroon’s ability to diversify its economy, thus it does not rely on oil exports. The Resident Representative, African Department of the IMF, Kadima Kalonji, states that; “However, public finances have been hurt and external position also has deteriorated and because of that, we are recommending various measures to allow the country to continue on its path towards emerging market studies, taking into account the negative wings.”  

He explained that the economic environment in April was gathering negative wings, which now have worsened. He stressed that the “environment has deteriorated, with countries of the region expected to embrace adjustments that can possibly face risks in the best possible way.”

External Borrowing

“Whatever we collect in terms of resources, we make sure that they are used efficiently and invested to the satisfaction of all the stakeholders,” stressed Finance Minister, Alamine Ousmane Mey. The chair of the day was responding to worries on whether Cameroon should continue to raise its debt ceiling. The IMF recommendation of optimising borowing faced debates, with the Minister of Economy, Planning and Regional Development, Louis Paul Motaze stating that Cameroon was focusing on sustainable borowing.

“Yes, we will borrow, but we will focus on life-changing projects,” Alamine Ousmane Mey said. Cameroon’s balance of payment reveals that agriculture is a major source of revenue. In this wise, investing in infrastructure through developing in agricultural activities will enable the State to continue to use its borowing wisely, produce, generate revenue and pay back debts.

“External borrowing needs to be done in a way that will ensure the sustainability of debts. It should also be done in a way that is benefitting growth the most. Projects that will be financed need to be those that have high growth dividends which will allow the repayment of the debt over time,” stressed IMF’s Kadima Kalonji.