The IMF has concluded its reviews of Cameroon’s financial programs, facilitating a significant disbursement of funds aimed at enhancing financial stability and climate change initiatives. Growth remains weak, necessitating stronger action towards non-oil revenue mobilization, governance improvements, and financial reforms. Momentum in economic recovery and adherence to structural reforms are essential for sustainable economic development in the country.
The International Monetary Fund (IMF) Executive Board has concluded the seventh reviews under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements concerning Cameroon. This completion allows for an immediate disbursement of approximately US$ 73.5 million, contributing to a total of US$ 718.1 million dispensed under these arrangements. Additionally, the second review of the Resilience and Sustainability Facility (RSF) arrangement has been finalized, releasing around US$ 45.9 million to support Cameroon’s climate change initiatives.
Though Cameroon’s economic recovery is ongoing, growth rates are still low. To significantly enhance medium-term growth prospects, stronger measures are required to increase non-oil revenue, reduce vulnerabilities within the financial sector, and improve governance, particularly in combating corruption. The ECF-EFF arrangements, initiated in July 2021 for a total of SDR 483 million ( approximately US$ 689.5 million), have been extended by 12 months as of December 2023, allowing additional time for the enforcement of necessary reforms.
In a statement by Mr. Nigel Clarke, Deputy Managing Director of the IMF, he emphasized the need for continual reforms to enhance macroeconomic stability and support sustainable growth. Furthermore, it is crucial for the Cameroonian authorities to focus on domestic non-oil revenue mobilization and ensure effective public financial management. He underscored the importance of maintaining budget discipline while advancing reforms in public enterprises and the energy sector.
The IMF also acknowledged efforts to bolster the financial sector’s soundness and the necessity for improved governance reforms, particularly with respect to anti-money laundering measures. Despite Cameroon’s high risk of debt distress, its debt is characterized as sustainable, necessitating focused efforts on restructuring the oil refinery and enhancing other state-owned enterprises to mitigate risks. Maintaining momentum in the RSF and fortifying the institutional framework for climate policies are essential in order to attract further investments.
Economic projections for Cameroon indicate a gradual increase in GDP growth, alongside expected changes in national account, public debt, and investment metrics over the coming years. The IMF’s insights reflect the significance of both immediate financial support and long-term structural reforms to facilitate sustainable development in Cameroon.
As Cameroon continues to navigate its economic challenges, targeted reforms and external support through the ECF, EFF, and RSF will be crucial in laying a foundation for future growth while addressing pressing issues such as climate resilience and fiscal stability.
The IMF’s recent evaluations and monetary support for Cameroon highlight the nation’s ongoing economic recovery amid subdued growth. It underscores the importance of implementing robust reforms aimed at enhancing non-oil revenue, ensuring fiscal discipline, and strengthening governance to foster a sustainable economic environment. Continuous support through international financial arrangements is vital for address climate change initiatives and stabilizing Cameroon’s macroeconomic landscape.
Original Source: www.miragenews.com
