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CEMAC: Cameroon repaid XAF382 bln to investors on the local money market in 2020 (MINFI)

CEMAC: Cameroon repaid XAF382 bln to investors on the local money market in 2020 (MINFI)
  • Comments   -   Wednesday, 10 February 2021 14:37

(Business in Cameroon) - During the 2020 fiscal year, Cameroon repaid XAF382 billion of loans raised on BEAC securities market. We gatherd that inorder to repay those loans, the country raised XAF413 billion by issuing treasury bills (short-term securities) on the same market.

According to Finance Minister Louis Paul Motaze, during the period under review, Cameroon’s net borrowings on the CEMAC money market was XAF31 billion. The official disclosed the figure on February 9, 2021, during the presentation of Cameroon’s 2021 public securities issuance program in Douala.

It is worthy of note that apart from the short-term financing raised on the market that year, the country also raised XAF360 billion through the issuance of treasury bonds whose maturity ranges from one to ten years. This brings to XAF773 billion the volume of financing mobilized by the country on BEAC public securities market in 2020 and to XAF391 billion the country’s net borrowing on the market that year.

"The funds raised through the issuance of treasury bills helped ensure better cash management by alleviating tensions related to the periodic decline in revenues. As for the funds raised through the issuance of treasury bonds, they contributed to the continuation and completion of many investment projects. These investments include XAF80 billion for road infrastructure, XAF70 billion for sports infrastructure, XAF45 billion for the Covid-19 response plan...," the Minister of Finance explains.

   "During each of those issuances, we recorded high subscription rates, up to 250% currently. This is uncontested evidence of investors’ appetite for Cameroon’s securities. Also, at each of the operations, the interest rates have decreased to fall below the average in our subregion and even outside the region. This is a guarantee of the resilience of our economy," he added.

This year, Cameroon, which has never defaulted on securities issued on the CEMAC money market, intends to capitalize on investor’s confidence in its securities to raise XAF350 billion. "35% of the funds raised will be allocated to the road infrastructure sector and engineering structures, 40% for the energy and water sector, 11% for the AFCON, and 5% for major agricultural projects," the Minister of Finance concluded.

Brice R. Mbodiam

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