(Business in Cameroon) - During the 2019 financial year, the Cameroonian government will seek XAF65 billion in banking financing, according to the provisional State financial operation table (Tofe) made available by the finance ministry.

The same amount is expected to be raised from local banks in 2020 and 2021, bringing the total amount sought by the government over the 3-year period to XAF195 billion. Thanks to the diversification of funding sources for the State budget, with the first bond issue in 2011 and the opening of the BEAC securities market in the same year, banks play an increasingly important role in financing State activities in Cameroon.

Indeed, apart from direct financing (XAF65 billion in 2019), banks also provide funds on the BEAC securities market (from which Cameroon plans to mobilize XAF260 billion this year) where they act and are approved as primary dealers (Svt).

Meanwhile, banking institutions based in Cameroon generally contribute 60 to 70% of the bonds (XAF100 billion to be raised in 2019) issued by the Treasury on the Douala Stock Exchange (DSX).

However, it should be noted that all the funds mobilized by these various mechanisms, banks being major players, are raised at non-concessional interest rates; a strategy which is not welcomed by the Bretton Woods institution, which regularly accuses the Cameroonian government of favoring expensive debt over concessional debt (less than 1%, but often with strict conditions).

Brice R. Mbodiam