On June 26, 2017, the Executive Board of the International Monetary Fund (IMF) approved a three-year arrangement under the Extended Credit Facility (ECF) with Cameroon for SDR 483 million (about US$666.2 million, or 175 percent of Cameroon’s quota) to support the country’s economic and financial reform program.
The ECF-supported program is expected to help Cameroon restore external and fiscal sustainability and lay the foundations for sustainable, private sector-led growth.
An amount of SDR 124.2 million (about US$171.3 million) will be immediately made available to Cameroon, further to the approval of the arrangement. The remaining amount will be phased in over the duration of the program, subject to semi-annual program reviews.
Following the Executive Board discussion on Cameroon, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, said:
“Cameroon has been hit hard by the twin oil price and security shocks which have affected the CEMAC region since 2014 and led to a sharp drop in the pooled international reserves. 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. The authorities’ Fund-supported program 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 Cameroonian authorities’ leadership has been instrumental in spearheading the coordinated regional response to maintain the integrity of the CEMAC’s monetary arrangement.
“Addressing the rising fiscal and external imbalances requires a sustained and balanced fiscal consolidation based on expanding the non-oil revenue base, prioritizing public investment projects with demonstrated growth dividends, and rationalizing recurrent expenditure, while protecting social spending. The authorities’ fiscal program is supported by comprehensive structural reforms in revenue mobilization and public financial management to further boost non-oil revenue collection, improve spending efficiency, and contain fiscal risks.
“The authorities are committed to enhance Cameroon’s competitiveness and medium-term growth potential, in line with their strategy to reach emerging economy status by 2035. The completion of large energy and transport public infrastructure projects will help boost private sector investment, job creation and further diversification, and is supported by complementary reforms to maintain financial stability, expand access to financial services and improve the business environment.
“The success of Cameroon’s program will also depend on the implementation of supportive policies and reforms by the regional institutions.”