IMF approves $670m Cameroon credit
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IMF approves $670m Cameroon credit

Posted NDI EUGEN NDI in Yaoundé

on  Wednesday, June 28   2017 at  12:30

The International Monetary Fund (IMF) has approved a three-year $670 million Extended Credit Facility (ECF) for Cameroon to support the country’s economic and financial reforms.

The Bretton Woods institution said in a statement issued on Monday that the credit would help address Cameroon’s large balance of payments need.

“Having initially shown resilience owing to its greater diversification, the Cameroonian economy is now facing decelerating growth, declining fiscal and external buffers, and rapidly-rising public debt,” IMF Deputy Managing Director Mitsuhiro Furusawa said in the statement.

Commodity prices

“The authorities’ fund-supported programme appropriately aims at addressing Cameroon’s large balance of payments need and restoring fiscal and external sustainability, while also contributing to the collective effort to rebuild regional reserves,” the IMF senior official said further.

The IMF decision allows for an immediate disbursement of $170 million to help the Central African nation restore external and fiscal sustainability and invest in sustainable private sector-driven growth.

Cameroon has been hit by the declining oil and commodity prices, which have affected the six-member Central African Economic and Monetary Community (CEMAC) region.

Economic challenges

The Yaoundé coffers have also been severely depleted by a war against terrorism, with the threats posed by the Boko Haram jihadist group along her northern borders with Nigeria.

After showing initial resilience to the shocks, Cameroon’s economic growth weakened from 5.8 per cent in 2015 to 4.7 per cent in 2016.

Heads of state the CEMAC bloc met in Yaoundé last December and agreed to involve the international financial institution and other development partners to resolve the region's economic challenges.

Last week, IMF approved a $640 million loan agreement for Cameroon's CEMAC neighbour Gabon, under the Extended Fund Facility.