IMF Reaches Staff-Level Agreement with Cameroon on the Fourth Reviews of the Extended Credit Facility and the Extended Fund Facility

IMF News, May 19, 2023

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The mission reached staff-level agreement with the Cameroonian authorities on economic and financial policies to support approval of the fourth reviews of the program under the ECF and EFF arrangements.
Completion of the fourth reviews by the IMF Executive Board, scheduled in late June 2023, would enable the disbursement of SDR 55.2 million (about US$73.8 million).
The arrangement was approved by the IMF Executive Board for a total amount of SDR 483 million (about US$689.5 million) on July 29, 2021.
Mission dates: visit to Yaoundé during May 4-17; statement issued May 19, 2023.

Growth is estimated at 3.7 percent in 2022.
Growth is projected to reach 4 percent in 2023.
Headline inflation reached 7.3 percent year-on-year at end-2022, up from 3.5 percent at end-2021.
Inflation is expected to moderate from 7.3 percent at end-2022 to 5.9 percent at end-2023.
Risks highlighted: tight global financial conditions and increased oil price volatility.
Medium-term prospects: “remain favorable provided reforms continue, and the external environment is supportive.”

The overall fiscal deficit declined to 1.1 percent of GDP in 2022 from 3 percent in 2021.
The non-oil primary deficit increased to 4 percent of GDP in 2022 from 3.9 percent in 2021.
Non-oil revenue performance improved substantially in 2022, due to both tax and non-tax revenues.
The non-oil primary deficit target under the program was met for 2022.
A substantial part of the subsidies for petroleum products for 2022, validated only in 2023, will be integrated into the revised 2023 budget.
Temporary and minor breaches of the target on non-accumulation of external payment arrears indicate the need to improve liquidity management and limit spending through exceptional procedures.
Public debt at end-2022 reached 46.5 percent of GDP, declining slightly from 46.8 percent of GDP at end-2021.
Authorities’ 2023 fiscal targets: reduce the overall fiscal deficit to 1 percent of GDP and the non-oil primary fiscal deficit to 2.4 percent of GDP in 2023.

To meet the SND30 (national development strategy for 2020-30) objectives, a substantial expansion of fiscal space for priority spending—especially infrastructure—is required while maintaining debt sustainability.
Recommended fiscal measures:
- Further mobilize non-oil revenues.
- Broaden the tax base following the review of tax policy.
- Better target priority spending and improve expenditure efficiency.
Public financial management and public investment recommendations:
- Implement recommendations from the public investment management assessment (PIMA) follow-up of 2020.
- Complete the public expenditure and financial accountability review (PEFA) currently underway.
- Ensure a credible budget and disciplined budget execution to avoid accumulation of unpaid domestic obligations and support timely completion of major infrastructure projects, especially in the transport and energy sectors.
Public enterprise and governance measures:
- Strengthen the performance and financial management of public enterprises and proceed with planned rehabilitation of SONARA.
- Launch and implement the financial inclusion strategy.
- Strengthen governance, including the launch of a broad diagnostic of economic governance and plans to strengthen the Supreme Court’s Audit Bench.
Structural transformation priorities:
- Accelerate reforms to support deep structural transformation of the economy.
- Improve the business climate for the private sector to underpin inclusive and resilient growth.

The IMF staff will prepare a report, based on the mission’s preliminary findings, that—subject to management approval—will be presented to the IMF Executive Board for discussion and decision.
If the Executive Board completes the fourth reviews in late June 2023, Cameroon will access SDR 55.2 million (about US$73.8 million) in financing.

IMF mission leader: Ms. Cemile Sancak, Mission Chief for Cameroon.
The IMF team met with: Prime Minister Joseph Dion Ngute; Minister and Secretary General of the Presidency Ferdinand Ngoh Ngoh; Minister of Finance Louis Paul Motaze; Minister of the Economy, Planning and Regional Development Alamine Ousmane Mey; National Director of the BEAC Emmanuel Nkoa Ayissi; other senior officials; representatives of development partners; the diplomatic community; the private sector; and civil society.
The IMF team expressed thanks to the Cameroonian authorities for their cooperation and constructive dialogue.

Press Release No. 23/162 — May 19, 2023, IMF Communications Department