Cameroonian Treasury mobilized a total of XAF136 billion during the first quarter this year on the Beac securities market. According to authorized sources at the finance department, this amount is a record ever hit by Cameroon since the market opened in 2011.

Further, it translates investors’ interest in Cameroonian government securities, the average subscription rate being 267% according to sources.

As provided in the Finance Act 2019, the treasury should raise a total of XAF260 billion this year.

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The four cement producers in Cameroon achieved a cumulated turnover of XAF191.9 billion in 2018, sources at the tax administration said.

Market leader Dangote Cement Cameroon, the local arm of Nigeria’s Dangote Group, closed the year with XARF86.4 billion selling a total of 1.2 million tons of cement.

Cimencam, the Cameroonian subsidiary of LafargeHolcim, came second with XAF70.7 billion. The company sees higher revenues this year since it inaugurated April 2 a new production plant in Nomayos, Yaoundé suburb. With this 500,000-tons unit, the once market leader plans to regain its position on the market.

Benoît Galichet, MD of Cimemcam, says the Nomayos unit makes it possible for the company to “get closer to promising markets” in the central, south, and east regions, and tap opportunities in neighboring countries such as the Central African Republic.

Cimaf Cameroon controlled by Moroccan Addoha, closed the top 3 with a turnover of XAF28.5 billion, ahead of Medcem Cameroon (controlled by Turkish Eren Holding) which made XAF6.3 billion over the period reviewed.

Brice R. Mbodiam

The Bank of Central African States Beac achieved last year a net positive result of XAF14.4 billion. Figures are however down XAF62.7 billion compared to the XAF77.1 billion collected the previous year, according to the bank’s financial statements.

 The significant decline is linked to lower income revenues achieved by the market room, with the maturity in January, April and July 2018 of three lines of securities in the investment portfolio. In need to keep risks in check in its market room, Beac decided last year “not to build up a new investment portfolio, given the 2.4-month foreign exchange reserve coverage ratio, below the three-month target threshold set by the Monetary Policy Committee.”

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Cameroonian Finance Minister, Louis Paul Motazé (photo), announced the state is opening an escrow account with the Bank of Central African States (Beac) to ensure better financing for municipalities.

Escrow will receive XAF5 billion every month from the single Treasury account as additional municipal taxes. The move is to tackle disrupted financing due to the delay in monies transfer from the treasury account to the Special Inter-municipal Equipment and Intervention Fund (Feicom) which is the mechanism through which the government distributes the additional municipal taxes.

Thanks to this account, communes should now receive more quickly the estimated XAF160 billion granted each year, thus carry out development projects more efficiently.

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Cameroonian insurance company Activa is officially opening a branch in the Democratic Republic of Congo on May 27, Atlas Magazine revealed.

This move makes Activa the very first foreign insurer that obtained the Congolese regulator’s green light after the sector was liberalized in the country and the insurance local market open to foreign capital. Approval was granted March 28, 2019.

Newcomers on the Congolese insurance market also include Rawsur SA and Rawsur Life, both subsidiaries of Congolese Rawbank, and the Financial Insurance Corporation of Congo along with brokers Gras Savoye and Allied Insurance Brokers Sarl that also obtained approval March 28.

Being Cameroon’s third largest non-life insurer in 2016, with a turnover of XAF17.7 billion (Finance ministry), Activa aims for expansion across sub-Saharan Africa. It is already present in Ghana, Guinea Conakry, Liberia and Sierra Leone.

The company was created in 1998 by Cameroonian Richard Lowé who is the biggest shareholder. It benefits from the expertise of international lenders such as Proparco and the International Finance Corporation (IFC), respectively subsidiaries of the French Development Agency (AFD) and the World Bank dedicated to private investment; both of which hold interest in Activa.

Brice R. Mbodiam

Cameroon Inter-Employer Group (Gicam) met the Association of credit institutions’ professionals (Apeccam) on April 4 in Douala, the Cameroonian economic capital, to discuss the new exchange regulation within the Cemac region.

Celestin Tawamba, President of Gicam, took this opportunity to express his concern about the difficulties faced by economic operators in accessing foreign exchange, in Cameroonian banks.

“For 71% of employers who are members of Gicam, access to foreign exchange is a major concern,” he said, denouncing banks that make “indecent proposals” to economic operators at usury rates.

The meeting was also attended by representatives of the Central Bank of CEMAC States Beac which some commercial banks say is the cause of this currency shortage. In response, Beac reassures about the availability of foreign currency and says the situation is the result of a strict enforcement of rules on foreign exchange transactions; rules that some banks did not fully follow.

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Cameroon’s trade deficit worsened last year to XAF1,438.3 billion, an increase by 22.8% (XAF265.9 billion) compared to 2017.

According to the national Statistics Institute (INS), the widened deficit is linked to a year-on-year hike by 11.5% in import spending, added to a minor increase by 4.5% in export revenues. “Increased imports is due to higher purchase of fuel and lubricant whose bills grew 87.9% to XAF473.4 billion in 2018 from XAF251.9 billion in 2017. These products were purchased by the National Refining Company (Sonara) to supply the local market, in response to technical shutdown between April and November 2018,” INS says.

Excluding oil, Cameroon's trade deficit is more pronounced at XAF2127.8 billion. This reflects an increase by XAF422.2 billion (+24.8%) compared to the previous year. “This rise in the non-oil deficit is linked to a 3.0% decline in non-oil exports, followed by a 13.7% increase in non-oil imports.”

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Société camerounaise de palmeraies Socapalm, Cameroonian arm of Luxembourg Socfin, posted a net result of €17.370 million (XAF11.3 billion) in 2018, against €15.707 million in 2017 (XAF10.2 billion). This reflects an increase by about XAF1.1 billion over the one year period.

Upward performance was foreseen as in the first half of 2018 the company was already expecting the sale of its entire production. Socapalm's stock of crude palm oil for sale rose from 16,481 tons as at June 30, 2017, to 30,959 tons the same period in 2018, an increase of 87.8%.

As regard turnover, Socapalm exceeded targets. Figures reached €100.450 million (XAF65.79 billion) in 2018, compared with the XAF62 billion initially planned.

In 2018, the company produced 135,642 tons of palm oil in 2018 up from the 118,840 tons in 2017, over a 29,804 ha area.

S.A

Unlike other countries within the Cemac area, Cameroon’s current balance deficit worsened during the past year. According to recent data from the Bank of Central African Countries (Beac), the country’s deficit grew to 3.4% over the period, against 2.5% in 2017.

Such a situation is driven by a negative trade balance performance of XAF271.7 billion in 2018 compared to XAF117 billion, according to Beac projections. A negative trend is also observed in Equatorial Guinea with deficit reaching 8.5% of GDP in 2018 against 7.1% in 2017.

Deficit narrowed in Gabon (2.7% in 2018 compared to 5.0% a year earlier); Chad (4.2% after 7.1% in 2017) and the Central African Republic (8.0% after 8.5% in 2017). The rate returned to surplus in Congo (+2.6% against -2.5% in 2017).

Overall, CEMAC's external accounts show a decrease in the current account deficit, including official grants, from 4.2% of GDP (XAF2,057.9 billion) in 2017 to 3.1% in 2018 (XAF1,622.5 billion).

“This improvement (for the region) would result from a 49.1% increase in the trade balance surplus to XAF6,436.9 billion in 2018, thanks to a larger increase in exports (+20.4%) than in imports (+6.3%),” explains the Beac.

S.A

The Cameroonian Treasury is seeking another XAF10 billion on the securities market of the Bank of central African Countries (Beac). According to an official finance ministry statement, monies will be raised April 10 through the issue of a 26-week treasury bills (BTAs).

These short-term securities are, along the 13-week bills, the most sought after on the market compared to the fungible treasury bonds (OTAs) which are mid- and long-term securities.

This preference of investors for BTAs can be explained by the preponderance of demand deposits in Cemac banks which are the main fund providers on this public securities market; with 99% of the financing made available to States, according to the Supervisory Board of the BEAC Securities Settlement and Custody Unit (CRCT).

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