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Covid-19: IMF disburses XAF86.2 bln for Cameroon under the RCF program

Covid-19: IMF disburses XAF86.2 bln for Cameroon under the RCF program
  • Comments   -   Thursday, 22 October 2020 16:40

(Business in Cameroon) - On October 21, 2020, the administrative board of the IMF (in the framework of its rapid credit facility aimed at providing financial support to help countries fight the coronavirus pandemic) approved a second disbursement for Cameroon. The volume of this disbursement is US$156 million (CFAF86.2 billion).

This disbursement included, the volume of funds provided to Cameroon in the framework of the rapid credit facility (RCF) amounts to US$382 million (CFAF211.3 billion). All these funds are aimed at helping Cameroon implement the response program elaborated for the coronavirus pandemic, whose first case was confirmed in the country in March 2020.

According to the IMF, since the approval of Cameroon’s first rapid credit facility request on May 4, 2020, the weak external demand from the countries’ main commercial partners and the pronounced impacts of the containment measures worsened the countries growth prospects as well as external and fiscal positions.

Consequently, “urgent balance of payments needs arising from the pandemic have increased, with the financing gap now estimated at CFAF 917 billion (ed.note: CFAF628 billion in June 2020),” the IMF writes. Therefore, the institution believes, the current financial support will help address Cameroon’s “urgent financing needs to mitigate the impact of the pandemic.”

On closer analysis, apart from being released because Cameroon faces urgent financing needs, this financial support was provided because the Bretton Woods institution is satisfied with the response strategy initiated by Cameroon in March 2020, once it confirmed the presence of the virus on its territory.

The authorities have been proactive in responding to the COVID-19 pandemic and are stepping up their efforts to contain the spread of the disease, boost health and social protection spending, and provide temporary support to affected businesses and households. In that regard, they adopted a series of measures including a revised budget with a larger deficit to accommodate automatic stabilizers and crisis-related emergency spending; a three-year preparedness and response (P&R) plan against the pandemic as well as the creation of a COVID Special Account ,” the institution adds.  

Brice R. Mbodiam

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