Yaoundé - 09 December 2023 -

BGFIBank Cameroon commits CFA3.5bn to Camwater project for clean water

BGFIBank Cameroon commits CFA3.5bn to Camwater project for clean water
  • Comments   -   Thursday, 09 November 2023 16:48

(Business in Cameroon) - More details have emerged regarding the tripartite agreement signed on November 1, 2023, in Douala between Cameroon Water Utilities (Camwater), the Chinese CGCOC - responsible for implementing the second phase of the Drinking Water Supply Project for nine cities (Paep), and BGFIBank Cameroon. According to information made available, this agreement covers the financing of the CFA10.6 billion amendment signed on August 28 between Camvater and CGCOC as part of the project to supply drinking water to the towns of Maroua, Garoua, Garoua-Boulai, Yabassi, and Dschang.

"We will immediately provide CFA3.5 billion," a reliable source within BGFIBank Cameroon said, suggesting that the bank might be involved in raising the total funding for this amendment. However, Business in Cameroon was not able to find out exactly what role the credit institution might play in raising the remaining CFA7.1 billion. The conditions (interest rate, maturity, repayment mechanism, etc.) of the CFA 3.5 billion loan already granted are also unknown. "BGFIBank Cameroun is consolidating its commercial momentum with Camwater and is once again a major player in financing with a social impact that contributes to the country's development", the bank simply commented.

During the signing of this amendment, which represents 20% of the baseline market, the financing terms, to be supported by Cameroon in addition to the initial counterpart funds, were still under discussion between the Ministry of Energy and Water (Minee), the Ministry of Economy, Planning, and Territorial Development (Minepat), and the national sinking fund (CAA), the country's public debt manager. With this amendment, the project cost has increased to approximately CFA63 billion. The other funding comes from a loan of 594 million yuan (approximately CFA49.2 billion at the current yuan value) obtained on September 22, 2018, from the Chinese public bank Eximbank, with a grace period of 7 years, a maturity of 36 years, and an interest rate of 2%, according to CAA.

The groundbreaking of the project took place on August 28, nearly 5 years after the financing agreement was signed. "The conditions for the start of the second phase included the completion and acceptance of phase one. This has been delayed. Due to the late connection of the sites to the power grid, acceptance took place in 2020," Camwater explained. The first phase of this project began in 2014, covering the cities of Bafoussam, Bamenda, Kribi, and Sangmélima. The project is part of Camwater's five-year priority investment program.

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