logoBC
Yaoundé - 25 November 2020 -
Finance

Covid-19: Beac initiates easing measures to facilitate crusade against the virus

Covid-19: Beac initiates easing measures to facilitate crusade against the virus
  • Comments   -   Tuesday, 31 March 2020 11:17

(Business in Cameroon) - On March 27, 2020, members of the BEAC Monetary Policy Committee held a videoconference to find solutions to the coronavirus crisis affecting the world, including the CEMAC region.

According to the official release published at the end of the videoconference, the BEAC has triggered some levers to favor the financing of member states and commercial banks of the region. In turn, those states and banks will have to support the companies whose activities have been affected by the health crisis.

First, the BEAC lowered two of its key rates. The tender rate was lowered by 25 basis points (from 3.5 to 3.25%) while the marginal lending rate went from 6 to 5%.

Also, the various types of collaterals admitted by the central bank as a guarantee for refinancing operations have been extended. Coupled with the lowered key rates, that extension provides more flexible latitude to commercial banks during their search for liquidity in the money market.

Those banks will use the liquidity to fund CEMAC economies by granting credits to companies and individuals (ed. note: even states) at adjusted rates, the BEAC hopes.

XAF500 billion of liquidity to be injected in the banking system

Last week, it was announced that the central bank would suspend its liquidity-absorbing operations. During this videoconference, it has been decided that more liquidity will be injected into the CEMAC banking system. In that regard, the volume of liquidity injected in the banking system will be increased from XAF240 billion to XAF500 billion. This volume could be revised upward if needed, the monetary policy committee indicates.

Let’s note that banks are not the only beneficiaries of the easing measures decided by the committee. To member countries, the central bank promises to ease the conditions for the issuance of public securities on the BEAC market that has become an important tool for countries’ funding needs, since 2015, after the drop in oil prices and some members’ large public deficit.

The BEAC also plans to negotiate with competent authorities to obtain a one-year rescheduling of the repayment of the Central Bank's consolidated credits to the States. This measure will loosen the debt stranglehold on the treasury of CEMAC countries, which will thus have more liquidity to fund the crusade against the Coronavirus.

 Brice R. Mbodiam    

cameroon-loses-over-xaf63-2-bln-to-corporate-tax-abuses-every-year-the-report-estimates
“The State of Tax Justice 2020: Tax Justice in the time of COVID-19. ” This is the title of a report recently published by three NGOs (the Global Alliance...
cameroon-minpmeesa-organizes-workshop-to-improve-the-marketability-of-artisan-products
On November 19, 2020, in Yaoundé, the Minister of SMEs, Social Economy, and Handicrafts (Minpmeesa), Achille Bassilékin III, chaired a workshop aimed at...
piccini-opposes-the-auction-of-containers-it-left-at-olembe-stadium
In a statement issued on November 24, 2020, the Italian company Piccini (withdrawn from the construction of the Olembé stadium) opposed the auctioning of...
cameroon-unlawful-use-of-fm-broadcast-bands-threatens-air-navigation-the-minpostel-indicates
On November 23, 2020, in Yaoundé, (at the opening of the 23rd, 24th, and 25th ordinary sessions of the Inter-ministerial Committee for the Assignment of...

Mags frontpage


Business in Cameroon n93: November 2020

Cashew, Cameroon’s new source of revenues


Covid 19 : “Making the team’s health a priority”


Investir au Cameroun n103 Novembre 2020

L’anacarde, la nouvelle source de recettes du Cameroun


Covid 19 : « La santé des équipes avant tout »