Yaoundé - 25 November 2020 -

Cemac: Member countries should amend their 2020 finance law because of Covid-19 (Ministers of Economy and Finance)

Cemac: Member countries should amend their 2020 finance law because of Covid-19 (Ministers of Economy and Finance)
  • Comments   -   Friday, 03 April 2020 10:55

(Business in Cameroon) - With the Coronavirus pandemic, revenue projections in Cameroon's 2020 budget of XAF4,850.50 billion have become unrealistic and budgetary allocations irrelevant. For several experts, it is now necessary to revise this finance law since for less significant shocks, Cameroon revised its budget in 2018 and 2019.

During a meeting, on March 28, in Brazzaville, Congo, CEMAC Ministers of Economy and Finance suggested member countries should quickly amend their finance law. The amendment, they say, should align with “updated and realistic forecasts of budget revenue and public expenditure, to strengthen the means of combating the spread of the Covid-19 pandemic, while ensuring the regular functioning of the State.

States were also invited to reallocate funds from non-priority public expenditure to the health system to enable effective care for infected persons. In other words, a country like Cameroon should increase the resources allocated to health.

Also, following the fall in the oil prices, Cameroon should lower its 2020 oil revenue forecasts, initially set at XAF443 billion. Indeed, the country based its forecast on the production of 26.5 million barrels with the barrel costing $57.9 and the dollar exchange rate at XAF552.7. However, with a barrel currently costing less than $30, Cameroon could see its oil revenues decrease by half.

 "We also know that with the decrease in foreign trade, imports will fall. And if imports fall, customs revenues will fall. All these will have consequences on the real economy. Reports have it that impacts will be terrible for our States. However, this will depend on the duration of the pandemic," Cameroonian Finance Minister Louis Paul Motaze (photo) said at the end of the Brazzaville meeting.

According to the official, Cameroon’s tax and customs revenues, forecasted at  XAF2,962.2 billion for 2020 should also be revised downwards.

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