The Bretton Woods institution have reached a Staff Level Agreement with Cameroon for a 36-month arrangements under the Extended Credit Facility (EFC) and the Extended Fund Facility (EFF).
T he International Monetary Fund (IMF) is poised to begin another arrangement with Cameroon with a possible disbursement of FCFA 390 billion under the Extended Credit Facility (ECF) and Extended Fund Facility (EFF). The new arrangement to run for 36 months, was arrived at after a series of virtual meetings by IMF mission led by Amadou Sy and Cameroonian authorities from May 13-27, 2017 which enabled both parties to discuss IMF financial support for economic reform programme. At the end of the two weeks mission, Mr. Amadou said “Cameroon has shown resilience in the face of the COVID-19 pandemic, but still faces significant challenges. While economic activity decelerated markedly in 2020, the slowdown was less than anticipated, reflecting strong performance in the agricultural and construction sectors. The current account deficit narrowed to 3.7 percent of GDP, owing to both lower imports and higher than expected non-oil exports. Inflation remained below 3.0 percent. In addition, the authorities’ proactive management of the COVID-19 pandemic helped contain the fiscal deficit to 3.6 percent of GDP,” the IMF release indicated. According to the release, Cameroon’s medium-term program centres on post-Covid-19 recovery, macroeconomic sustainability, and an ambitious structural reform agenda-laid out in the National Development Strategy for 2020-30 (SND30). In this context, the IMF-supported program builds on the SND-30, with a cross-cutting focus on reinforcing good governance, transparency, and anti-corruption measures. The new arrangement will focus on four main pillars notably mitigating the consequences of the pandemic, while ensuring macroeconomic sustainability; accelerating fiscal reforms to modernize tax and customs administration, mobilize revenue, improve public financial management, increase investment efficiency, and reduce fiscal risks from state-owned enterprises; strengthening debt sustainability and management; and intensifying structural reforms to boost economic diversification and financial sector resilience. IMF financial support is also expected to help stimulate private sector investment and catalyse additional financing from development partners. The program’s fiscal policy is expected to broaden the non-oil revenue base, reduce discretionary tax exemptions, combat tax fraud and evasion, and enhance tax and customs administration. Completion of the Treasury Single Account reform and reduced recourse to direct interventions and exceptional spending procedures will help improve cash management and budget execution, strengthen fiscal transparency and budget credibility. «The program will also aim to address financial and fiscal risks associated with state-owned enterprises. The efforts to restructure the national oil refinery (SONARA) will be based on a thorough cost-benefit analysis of all available options. In a farewell launch with the outgoing IMF Country representative, Fabien Nsengiyumva on May 27, Finance Minister Louis Paul Motaze reiterated that the new agreement will continue to consolidate the reforms the 2017-2020 ECF agreement started and focus on poverty reduction