Cameroon harvests big in treasury bonds sale.

Reliable sources in the Ministry of Finance, who disclosed the development to pressmen on condition of anonymity, indicated that the government has been silent on this success story because it was awaiting validation on the successful completion of the operation by the sub-regional Financial Market Surveillance Commission, COSUMAF. 

More so, as the money was raised through the subregional stock exchange, officially known as Bourse des Valeurs Mobilieres de l´Afrique Centrale, BVMAC, which requires that member states, including Congo Brazzaville, Gabon, Chad, Central African Republic and Equatorial Guinea must also give the go ahead before the BVMAC allows Cameroon to start making any withdrawals.

The 15,000,000 bonds were issued in multiple batches and sold at 10,000 FCFA each. The first batch to fetch 40 billion FCFA on an interest rate of 5.8 percent will mature in three years. 

The second batch to raise 40 billion FCFA at 6 percent interest rate will mature in four years. The third batch to raise 50 billion, at 6.75 percent interest rate will mature in six years. The last batch, the fourth, to raise 20 billion FCFA on an interest rate of 7.25 percent will mature in eight years.

Reasons for huge success

Government has attributed the huge success it recorded in the sales to investor confidence in Cameroon’s financial credibility, insisting that, it is a major feat to be applauded; especially considering the turbulent international financial climate, exacerbated by wars, health disasters and generalised insecurity.

Government has equally lauded the efforts of the consortium of banks and other financial institutions that organised the sales. Singled out for praise are financial capital, Afriland Bourse & Investment, Societe Generale, Capital Securities Central Africa, Attijari Securities Central Africa, and Urban Securities Central Africa, to name but these.

Sources in the Ministry of Finance have asserted that even before the bonds officially opened for sale, subscriptions by these financial institutions had taken up 70 percent of the total amount government was soliciting for.

It should be recalled that government has, since 2010, when it started resorting to raising development funds from the money market, never defaulted in reimbursing the money to subscribers when the bonds mature. 

Reason the International Monetary Fund, IMF has also never failed to open credit lines for the government after every review mission.

Where money raised is destined for

The government launched the 7^th batch of bonds sales on June 6, 2023, with aim to ensuring the takeoff of key development projects contained in the 2023 State Budget. The projects are also in line with the content of the strategic document for national development 2020-2030, SND-30.

These projects are elaborated under four main pillars, which are structural transformation of the national economy, human capital development and well being of the population, promoting the creation of jobs and economic insertion of citizens, improving governance, decentralisation and strategic management of the state.

Water and energy supply will be allotted 20.5 billion FCFA, public works-85.5 billion, urban development and improvement-14 billion and reconstruction of crises ridden Regions-15 billion FCFA.

For funds raised during the last six operations, government has indicated that many development projects were executed, with many others still ongoing. 

In the water and energy sector, government has revealed that money was used to construct hydroelectric dams at Memve´ele, Lom Pangar, and Mekin. There was equally the construction of a gas terminal in Kribi, stepping up water supply to the cities of Yaounde and Douala, including their surrounding communities. There are also the electrification of 166 localities using solar panels, the construction and reinforcement of electricity transport network all over the country.

As far as roads and other works are concerned, the government also disclosed that money raised in the past was used to construct a second bridge over the River Wouri and roads connecting the Foumban-Mankin-Mape Bridge. 

The Bamenda-Ekok-Batchuo-Akagbe corridor, Garoua Boulai-Ngaoundere, Figuil-Magada, Maroua-Kousseri and Sangmelima-Djoum-Mintom roads were also mentioned.

There is also the disenclavement, (Construction of access roads) to key production zones in the West Region, the Yaounde-Nsimalen highway, as well as the Yaounde-Douala and the Kribi-Lolabe highways, to name but these.