The IMF’s Executive Board completed reviews of Cameroon’s ECF and EFF arrangements, approving disbursements of approximately US$ 73.5 million and US$ 45.9 million for climate support. Despite economic recovery, growth remains subdued, necessitating stronger actions for revenue mobilization and governance improvements to ensure macroeconomic stability.
The IMF’s Executive Board has concluded the seventh reviews under Cameroon’s Extended Credit Facility (ECF) and Extended Fund Facility (EFF), permitting a disbursement of roughly US$ 73.5 million. Additionally, the second review under the Resilience and Sustainability Facility (RSF) led to about US$ 45.9 million being allocated to support Cameroon’s climate change initiatives. Despite ongoing recovery, economic growth in Cameroon remains weak, requiring stronger actions to mobilize non-oil revenues, mitigate financial vulnerabilities, and tackle governance issues.
The seven reviews for the ECF and EFF arrangements allow a disbursement of SDR 55.2 million (approximately US$ 73.5 million), raising total disbursements to SDR 538.2 million (US$ 718.1 million). The second RSF review grants an additional SDR 34.5 million (US$ 45.9 million), totaling an available SDR 69 million (US$ 91.3 million). In July 2021, the ECF-EFF arrangements were approved for up to SDR 483 million (US$ 689.5 million), with a 12-month extension approved in December 2023.
Mr. Nigel Clarke, Deputy Managing Director and Acting Chair of the IMF, commented on Cameroon’s economic performance, noting that while recovery has continued, growth is still lackluster. He stated, “The medium-term outlook remains broadly positive while the balance of risks is tilted to the downside.” The current arrangements are crucial for maintaining macroeconomic stability and supporting priority reforms along with climate sustainability efforts.
Mr. Clarke praised Cameroon’s fiscal management but emphasized the necessity for increasing domestic non-oil revenue and improving public financial management to maintain program progress. He highlighted the importance of spending control and advancing public enterprise reforms for fiscal resilience. Furthermore, he noted, “Stepping up governance reforms and strengthening the anti-money laundering and combating financing of terrorism (AML/CFT) regime will be needed to promote inclusive and private sector-led growth.”
Despite the high risk of debt distress, Cameroon’s debt is deemed sustainable. Critical reforms are needed in oil refinery restructuring and electricity sector enhancements to limit contingent liabilities and improve public services quality. Progress has been made under the RSF, and maintaining reform momentum is essential for climate resilience and attracting new investments.
The IMF’s recent reviews indicate both support and challenges for Cameroon. While the release of substantial funds aims to bolster economic recovery and climate initiatives, the country must strengthen revenue mobilization, tackle governance issues, and continue essential reforms to maintain macroeconomic stability and combat high debt risks. The IMFs insights underscore the delicate balance between growth and financial sustainability in Cameroon moving forward.
Original Source: www.miragenews.com
