Between January and April this year, the Cameroonian treasury collected XAF11.5 billion from transit charges of Chadian oil, according to the Pipeline Steering and Monitoring Committee (CPSP).

CPSP says the amount is up 38.1% compared to the same period in 2018 when the transit duties generated XAF8.3 billion. Higher revenues resulted from “the increase in crude oil volumes shipped from the pipeline terminal, due to the higher production by new shippers,” CPSP suggests. Over the period reviewed, it’s reported, 15.1 million barrels of Chadian oil were shipped from the Kribi terminal in the southern region of Cameroon, compared to 12 million barrels between January and April 2018.

Another reason for the increase in revenues is the revaluation of transit charges on 30 September 2018, officially increasing from $1.30 to $1.32 per barrel. This revaluation was carried out in accordance with the provisions of amendment No. 2 to the establishment agreement of Cotco, the company that manages the pipeline on the Cameroonian side.

BRM

As announced earlier by Business in Cameroon, President Paul Biya issued a presidential order May 29, amending and supplementing certain provisions of the 2019 Finance Act.

The new Act provides for an increase by XAF361.5 billion in State Budget from XAF4,850.5 billion to XAF5,212 billion. Of the amount, XAF121.5 billion will come from domestic resources (including XAF56 billion in oil revenues and XAF24.5 billion in tax revenues) and XAF240 from loans (including XAF188 billion in external loans).

Since growth projections have not been revised upwards, the new 2019 budget is expected to slightly increase the tax burden and widen the budget deficit compared to previous budget forecasts. The challenge now is to be able to maintain deficit below 2% of GDP as foreseen by the ECF program with the IMF.

The adjusted 2019 Finance Act confirms that Cameroon is going into debt to repay its debt. Of an increase by XAF361.5 billion in budget, XAF240 billion are loans. Yet, XAF225.57 billion of the budget is expected to service the debt. This means the extra money borrowed will almost come out to pay off an existing debt.

Current spending forecasts drop XAF14.5 billion showing monies granted to certain ministries and other public institutions will be cut. But others will receive budget reallocations as well. Beneficiaries include the ministry of public works which receives additional XAF44.06 billion, the ministry of sports and civic education (XAF44.06 billion), and the ministry of water and energy (XAF23 billion).

Amount initially granted to the defense ministry is revised downwards, narrowed by XAF13 billion. But this does not necessarily mean that the total defense budget is cut. The joint expenditure forecasts (line 65) are up by more than XAF50 billion. This budget line has often been used to finance the war.

According to the International Monetary Fund (IMF), the budget adjustment intends to “take into account the increase in expected revenues” and “fully integrate the expenditure needs related to the upcoming elections and fuel subsidies, while maintaining the overall deficit at 2% of GDP.”

The revised budget also provides for the acceleration of the implementation of externally financed investment projects that are under way on the basis of a disbursement plan, according to an IMF statement that marks the fourth review of the three-year program Cameroon signed with the Bretton Woods Institution in June 2017.

Aboudi Ottou

The Cameroonian government has increased the budget for municipal, legislative and regional elections for 2019. From an initial XAF50 billion, new budget is XAF80 billion, an improvement by XAF30 billion.

According to sources at the finance department, this followed a revision of the 2019 Finances Act passed in November 2018. Overall, 2019 State Budget is improved by XAF361.5 billion, from XAF4,850.5 billion to XAF5,212 billion. Sources explained that this is the result of the adoption by parliament of laws on the establishment of regional councils and the remuneration of their members. This suggests the organization of the country's first regional elections this year.

BRM 

Cameroonian ministry of economy, Alamine Ousmane Mey, has just signed a financing agreement worth XAF2.6 billion with Gilles Thibault, the French ambassador, and the French Development Agency (AFD)’s Manager for Cameroon, Benoit Lebeurre.  

Fund will be granted under the debt reduction and development contract (C2D), ongoing with France, and ensure a better management of public finance in the country. According to official sources, it will be used to start the second phase of the Support Project for Good Governance that has already seen the implementation of many reforms in that regard.

Yet, a lot remains to be done despite progress in this area. Mr. Mey says additional efforts are needed in terms of expenditure quality, commitment management, accounting and settlement of expenses.

BRM

Mineral water market in Cameroon is booming. Data from brewer Sabc showed that sales on this market reached 3.2 million hectoliters (320 million liters) in 2018.

Between December 2017 and December 2018, the water segment grew by 46.4% and in December 2018 alone, sales were up 16.7%. This strong performance is a result of the fierce competition on the mineral water market in Cameroon; a situation that has forced sector players to drop product prices since at least 3 months making it more accessible to even the most poorest households.

After several years of leadership of Tangui brand, produced by SEMC (controlled by Sabc), the arrival of Source du Pays in this market in 2016 has been a game-changer. With extremely attractive prices and the launch of the 10-liter packs, Source du Pays and its Supermont brand has taken market leadership from the SABC group's subsidiary.

After acquiring Nabco, which produces Opur mineral water brand, the company consolidated its leadership at the end of 2018, now controlling approximately 67% of the Cameroonian mineral water market.

BRM 

Cameroonian oil company Tradex announced it has achieved a profit of XAF10.3 billion and a turnover of XAF291 billion for the financial year 2018.

The company says it sold a total of 597,158 m3 of fuel, 97,952 tons of liquefied petroleum gas (LPG) or domestic gas, and 1,100 tons of lubricants over the period. Compared to the previous years, figures in FY2018 were higher. In 2016, Tradex reported a turnover of XAF231 billion, and a result of XAF9 billion. That year, the company sold 145,000 m3 of fuel, 626 tons of lubricants and 4994 tons of gas.

S.A.

Over the last three months of 2018, Cameroon’s GDP grew by 4.5%, the national statistics institute (INS) announced. Major growth driver, INS says, remained the tertiary sector which contributed 2.0 points to GDP growth, despite a slowdown, with a year-on-year rate of 3.6% after 5.1% the same period in 2017.

Services sector generated XAF2,278.8 billion over the period, while the secondary sector generated XAF1,030.2 billion and the primary sector XAF577.7 billion. According to the public institute, trade, financial services and transport activities contributed the most to the good performance by the tertiary sector.

Sales and repair activities contributed 0.9 points to growth, driven by strong demand during year-end holidays. Financial activities contributed 0.3 points, spurred by the increase in lending to the economy, particularly to the private sector. Transport, warehousing and communication activities also performed well, contributing 0.2 points to GDP growth.

However, INS points out, other tertiary sector activities slowed over the period reviewed. These include information and telecommunications (2.7% in Q4 2018 compared with 4.2% in Q3 2018), accommodation and food services (almost stable at 3.7% in Q4), non-market general government services (3.4% in Q4 against 5.1% in Q3).

S.A

Cameroonian finance minister, Louis Paul Motaze (photo), officially launches today May 23 in Yaoundé, the exploitation of the National Personal Property Security Register (RNSM). It is a database that centralizes information relating to personal property, conventional and credit security rights.

According to the minister, this directory supplements the real estate security rights registry. The property securities, favored by credit institutions, could not be produced by all categories of customers for access to credit, such as small and medium-sized enterprises (SMEs) and individuals.

The project to establish the Personal Property Security Registry, developed with the support of the World Bank, aims to reduce the difference in information levels between borrowers and money lenders. As a result, it should make credit more accessible.

As part of the implementation of an online RNSM system in Cameroon, the government reports that there are sanctions against financial institutions guilty of concealing or misrepresenting movable property pledged as collateral by borrowers.

S.A

Between April and June 2019, Cameroonian treasury will have to mobilize XAF137.69 billion to pay back money it owes to lenders and other state organizations, the General Directorate of the Treasury revealed.

The Directorate says XAF50 billion of the sum will repay five matured treasury bills (BTAs), while the remaining XAF87.69 billion will serve as advance, part of which will repay the annual instalments of the three bond issues and the outstanding Eurobond, with XAF13.23 billion per month. And XAF48 billion (XAF16 billion per month) will replenish the VAT, Road Fund and Feicom escrow accounts.

BRM

Brewers in Cameroon sold a total of 6,500,000 hl (650 million liters), free beer excluded and trade included, as at December 31, 2018, according to data provided by Société Anonyme des Brasseries du Cameroun (SABC).

These figures remain approximatively stable compared to sales the previous year, but are slightly 0.4% lower. Market leader Sabc says it sold 4,655,000 hl (465.5 million liters) over the period reviewed, down 1.3% compared to 2017, representing 7.1% of sales targets. The remaining 184.5 million liters was sold by Guinness Cameroun and UCB.

Of the volumes sold, Sabc exported 43,700 hl (4.37 million liters) down 0.6% compared to the previous year due to “the difficult economic period in the CEMAC zone and the extent of fraudulent imports of products from Nigeria and Equatorial Guinea.”

Following the enforcement of the new 2019 Finance Act and the subsequent price increase on March 1, 2019, the SABC is expecting a 10% decrease in volumes on the reference products for which it had to increase prices; this means a reduction in sales by nearly 450,000 hl (4.5 million liters).

S.A