IMF Executive Board Concludes Third Reviews of Extended Credit Facility and Extended Fund Facility Arrangements for Cameroon and Approves US$73 Million Disbursement


Cameroon: IMF Executive Board Concludes Third Reviews of Extended Credit Facility and Extended Fund Facility Arrangements for Cameroon and Approves US$73 Million Disbursement







March 8, 2023











  • The IMF Executive Board completed the Third Reviews of the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements, enabling Cameroon to draw the equivalent of US$73 million in disbursements from the IMF.
  • The economic recovery is underway amid increased challenges in an uncertain global environment, with growth estimated at 3.4 percent in 2022, supported by higher oil prices and non-oil production.
  • Sustained reform implementation will be needed to create additional fiscal space for productive investment and social spending and to move toward inclusive and resilient growth.





Washington, DC:
The Executive Board of the International Monetary Fund (IMF) concluded
today the Third Reviews of the three-year arrangements under the

Extended Credit Facility

(ECF) and the

Extended Fund Facility

(EFF) with Cameroon, which were approved on July 29, 2021 for SDR 483
million (about US$689.5 million, or 175 percent of quota). This will allow
disbursement of SDR 55.2 million (about US$73 million), bringing total
disbursements under the arrangements to SDR 317.4 million (around US$420
million).

Cameroon’s recovery is underway amid increased challenges in an uncertain
global environment. Growth is estimated at 3.4 percent in 2022, supported
by higher oil prices and non-oil production. Headline inflation is
estimated at 6 percent at end-2022. The overall fiscal deficit improved
from 3 percent of GDP in 2021 to around 1.8 percent in 2022 reflecting
higher oil revenues, while the non-oil primary deficit deteriorated from
3.9 percent of GDP in 2021 to 4.5 percent in 2022 mainly due to increased
fuel subsidies. Real GDP growth is projected at 4.3 percent in 2023 and
should average 4.5 percent in the medium term.

In completing the reviews, the Executive Board approved waivers of
nonobservance for two performance criteria: (i) The floor on the non-oil
primary balance at end-December 2022 was missed due to higher oil prices
and currency depreciation leading to higher spending on the fuel subsidy;
and (ii) The continuous zero ceiling on the accumulation of new external
payments arrears was missed following delayed debt service payments due to
end-year cash management issues, which have already been cleared. These
waivers of nonobservance were approved due to the corrective actions taken
by the authorities, and the temporary nature of the non-observance,
respectively. In addition, the Executive Board approved a waiver of
applicability for three end-December 2022 performance criteria, for which
data are not yet available, and there is no evidence that they were not
observed.

At the conclusion of the Executive Board’s discussion, Ms. Antoinette
Sayeh, Deputy Managing Director and Acting Chair, made the following
statement:

“Cameroon’s economy proved resilient to the COVID-19 pandemic, and the
recovery has continued. However, the country is now faced with increased
challenges in an uncertain global environment, underscoring the need for
resolute reform implementation. The Fund-supported arrangements have
enabled the authorities in sustaining macroeconomic stability and growth in
a challenging context. Structural reforms need to be accelerated to
strengthen medium-term external and fiscal sustainability and move Cameroon toward inclusive and resilient
growth through a diversified economy. The country’s medium-term outlook
remains favorable.

“Cameroon’s performance under the program is mixed. Two of the six
quantitative performance criteria at end-December 2022 and three of the
five indicative targets at end-June and end-September 2022 were missed.
While important steps have been taken to advance long delayed
structural reforms, progress is lagging in some key areas. The
authorities have resolved to implement corrective measures to address
missed targets and accelerate reforms more broadly.

“The authorities are committed to
sustaining their fiscal consolidation to help achieve macroeconomic
stability, while building the foundations for inclusive and resilient
growth. They have taken the decision to reduce fuel subsidies
accompanied by measures to mitigate the social impact. Mobilizing
additional domestic non-oil revenue, improving public financial
management, and further efforts to reduce fuel subsidies will make
additional room for productive investment and social spending.
Mitigation measures to protect the vulnerable will be critical.
Resolving and preventing external and domestic arrears and seeking
concessional financing are also important.

“To unlock Cameroon’s abundant growth potential, effective and resolute
implementation of structural reforms in the National Development
Strategy is essential. In this regard, further steps are needed to
enhance investment efficiency, strengthen financial inclusion, and
improve the business climate. This should be accompanied by
strengthening transparency, governance, and the anti-corruption
framework, as well as ensuring financial sector stability.”


Table 1. Cameroon: Selected Economic and Financial Indicators, 2021-27

 


 (CFAF billion, unless otherwise indicated)

2021

2022

2023

2024

2025

2026

2027

Est.

2nd Rev.

Est.

2nd Rev.

Proj.

Proj.

Proj.

Proj.

Proj.

(Annual percentage change, unless otherwise indicated)

National account and prices

GDP at constant prices

3.6

3.8

3.4

4.6

4.3

4.4

4.5

4.6

4.7

Oil GDP at constant prices

-3.2

4.2

-5.1

-3.0

0.7

1.1

0.3

0.3

0.3

Non-Oil GDP at constant prices

3.8

3.8

3.6

4.8

4.4

4.5

4.6

4.7

4.8

GDP deflator

3.3

4.8

4.6

2.4

4.8

4.3

3.0

2.0

2.0

Nominal GDP (at market prices, CFAF billions)

25,158

27,389

27,210

29,325

29,749

32,393

34,866

37,226

39,777

Oil

801

1,187

1,073

1,090

907

862

814

777

747

Non-Oil

24,357

26,201

26,137

28,235

28,841

31,531

34,052

36,449

39,030

Consumer prices (average)

2.3

4.6

5.3

2.8

5.9

4.7

3.0

2.3

2.0

Consumer prices (eop)

3.5

4.1

6.0

2.9

5.7

3.7

2.3

2.1

2.0

Money and credit

Broad money (M2)

17.2

15.6

11.4

10.1

8.1

9.9

8.0

7.1

8.2

Net foreign assets 1/

4.3

5.1

7.7

4.0

1.0

1.8

2.3

2.9

2.8

Net domestic assets 1/

12.9

10.5

3.6

6.1

7.0

8.1

5.7

4.2

5.4

Domestic credit to the private sector

9.7

9.1

13.6

12.4

8.8

7.4

7.1

6.9

6.7

(Percent of GDP, unless otherwise indicated)

Savings and investments

Gross national savings

14.0

16.3

15.9

17.3

15.9

16.6

17.9

19.0

20.4

Gross domestic investment

17.9

18.4

17.4

20.0

18.8

19.6

20.6

21.6

22.8

Public investment

4.5

5.2

5.2

5.4

5.0

5.4

5.7

6.3

6.9

Private investment

13.4

13.2

12.2

14.6

13.8

14.1

14.8

15.2

16.0

Central government operations

Total revenue (including grants)

14.0

15.4

16.1

15.9

15.5

15.3

15.2

15.2

15.4

Oil revenue

1.9

2.9

3.6

2.7

2.8

2.2

1.8

1.7

1.6

Non-oil revenue

11.8

12.0

12.0

12.8

12.4

12.8

13.1

13.4

13.7

Total expenditure

16.9

17.4

18.0

16.1

16.2

16.0

15.5

15.9

16.4

Overall fiscal balance (payment order basis)

Excluding grants

-3.2

-2.5

-2.4

-0.5

-1.1

-0.9

-0.5

-0.8

-1.2

Including grants

-3.0

-1.9

-1.8

-0.2

-0.8

-0.6

-0.3

-0.7

-1.1

Overall fiscal balance (cash basis)

Excluding grants

-2.7

-3.0

-2.8

-1.0

-1.6

-1.4

-0.9

-1.1

-1.2

Including grants

-2.4

-2.5

-2.3

-0.7

-1.3

-1.1

-0.7

-1.0

-1.1

Non-oil primary balance (payment order basis)

-3.9

-4.0

-4.5

-2.2

-2.4

-1.7

-1.1

-1.4

-1.6

External sector

Trade balance

-1.1

-0.7

0.4

-1.3

-1.3

-1.4

-1.3

-1.2

-1.2

Oil exports

4.9

7.5

7.1

6.0

5.4

4.9

4.5

4.2

4.0

Non-oil exports

8.3

9.4

8.9

8.7

8.0

7.6

7.7

7.8

8.0

Imports

14.4

17.6

15.7

16.0

14.7

13.9

13.5

13.2

13.1

Current account balance

Excluding official grants

-4.2

-2.6

-2.2

-3.0

-3.2

-3.0

-2.8

-2.6

-2.5

Including official grants

-4.0

-2.1

-1.6

-2.6

-2.8

-3.0

-2.6

-2.5

-2.5

Terms of trade

9.4

7.1

3.6

-7.1

-8.4

-1.9

-2.6

-2.1

-0.9

Public debt

Stock of public debt

46.8

44.0

46.4

40.8

42.8

40.4

38.5

37.5

37.2

Of which:
external debt

31.7

31.2

32.7

30.3

30.5

29.7

29.1

29.2

29.4

Sources: Cameroonian authorities; and IMF staff estimates
and projections.

1/ Percent of broad money at the beginning of the period.

 


IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Nicolas Mombrial

Phone: +1 202 623-7100Email: [email protected]

@IMFSpokesperson





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