Autonomous Sinking fund boss allays fears Cameroon’s public debt not sustainable.

CAA boss, close collaborators exchanging with journalists

Despite the upsurge in Cameroon’s public debt, from 1,379 billion FCFA in 2008 to 12,714 billion FCFA as at March 2024, officials of state debt management agency, the Autonomous Sinking Fund, popularly known by its French abbreviation CAA, have said there is no reason to panic.

The General Manager of the Autonomous Sinking Fund, Aldophe Noah Ndongo, dismissed fears of debt unsustainability, over dependence on creditors and the weakening of the country's economic sovereignty, Friday, June 14. 

The assurance and other vital clarifications relating to the country’s debt situation were presented to reporters at the CAA’s head office in Yaounde. This was during a press lunch which the General Manager of CAA organised. 

The CAA boss, flanked at the press lunch by a crack team of his close collaborators, including the Deputy General Manager, Kendem John Forghab, justified that Cameroon’s debts are sustainable, based on the giant development projects such funds are used to finance. 

The CAA General Manager explained to journalists in his opening remarks that the press lunch was to adequately arm them with the “right material” and “right information,” that would guide their analyses on issues related to Cameroon’s public debt situation. 

"…the public debt debate has gained momentum. Collective concerns about excessive indebtedness persist, despite frequent announcements of new loans and the unprecedented realisation of major projects across Cameroon,” Noah Ndongo said, adding that: “Cameroonians are now questioning the sustainability of public debt and our country's ability to maintain its sovereignty in the face of the appetites of certain bilateral and multilateral creditors".

He told journalists that in low-income countries, debt is often seen as an essential source of financing of budget deficit. 

The CAA boss further noted that states also use debt “to stimulate investments and encourage sustainable growth”. 

CAA Deputy GM, other officials during event 

 

 

 

Justifies debt sustainability 

Harping on the country’s public debt situation, Noah Ndongo began by tracing the genesis of Cameroon’s first loans to the colonial period in 1952 and 1953. Loans contracted during this period, he explained, were to finance energy projects. 

He detailed that Cameroon’s current public debt which stands at 12,714 billion FCFA is less than 45 percent of its Gross Domestic Product, GDP, which is far below the threshold of 70 percent in the Economic and Monetary Community of Central African, CEMAC. 

The CAA boss disclosed that foreign nations like France have public debts at 100 percent of GDP while that of Japan is 200 percent of GDP.

He said the institution he heads does it utmost to give the best possible advice for better control of public debt.

"We play an advisory role to the government. We make sure that when the State goes into debt, it's at the lowest possible rate. We give our opinion. The government has set up an instrument to ensure that there are no more white elephants," Noah Ndongo stated. 

 

Debts used on giant dev’t projects

Noah Ndongo justified that public debt rose from 1,379 billion FCFA in 2008 to 12,714 billion FCFA at the end of March 2024, because the huge amount contracted during this period has been used to finance a vast program of development.

He said the projects are structured around the Head of State’s 2035 emergence vision, launched since the country reached the completion point of the Highly Indebted Poor Countries, HIPC Initiative. 

CAA boss and his crack team of collaborators detailed projects such funds have been used to finance in the transport, health, energy, sports, higher education and water sectors. All these, he said, are all aimed at improving the living conditions of Cameroonians.