9 July 2018

Cameroon: Extended Credit Facility for Cameroon - IMF Approves Disbursement of Fcfa 43 Billion

It was on July 6, 2018 after a second review of economic reforms under the three-year agreement between government and the institution.

The executive board of the International Monetary Fund has completed its second review of the economic performance of Cameroon under the Extended Credit Facility (ECF) arrangement introduced in June 2017.

The completion of the review during a meeting of the board in Washington D.C on July 6, 2018 which showed that the 2018 economic outlook for Cameroon remains positive, paved the way for the disbursement of 77.8 million US dollars (about FCFA 43 billion) to the country.

The ECF, worth 680.7 million US dollars, is intended to support economic and financial reforms in Cameroon over a period of three years. The approved disbursement would be the third of its kind. Some 171.3 million US dollars (circa 97 billion) was provided in July 2017 while another disbursement of 117.2 million US dollars was granted in December same year. The total amount disbursed at the moment stands at about 366 million US dollars.

The disbursements are generally approved after mid-term evaluation meetings held after completion of article IV consultations. The article requires that IMF sends a team to the country under review to discuss with policy makers and gather economic and financial information. The report of the team forms the basis of discussions of the board. This was the aim of the visit of African Department Director, Abebe Aemro Sélassié, to Cameroon July 5.

It was therefore after deliberations on his report that the executive board meeting on July 6, 2018 concluded that the macroeconomic outlook for 2018 remains positive, with growth expected to rebound to 4 percent (from 3.2 per cent in 2017) driven by the onset of gas production and construction activities for the 2019 African Cup of Nations.

It was noted in the press release issued after the meeting that the government has adopted a comprehensive economic reform programme to restore fiscal and external sustainability and buttress private sector-led inclusive growth, supported by the IMF's ECF arrangement.

Mitsuhiro Furusawa, Deputy Managing Director, and Acting Chair, said financial sector and structural reforms made by Cameroon would reduce vulnerabilities and address remaining competitiveness bottlenecks. An executive board assessment advised government to fully adhere to the revised 2018 fiscal targets and save any extra revenue from increased oil prices.

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