In the face of growing debt levels, Economic Experts at the Nkafu Policy Institute, a think tank of the Denis and Lenora Foretia Foundation say strengthening the private sector could help reduce Cameroon’s indebtedness.
The analysts were speaking on Wednesday November 24, 2021,while presenting results of a study on the implementation of the 2021 State Budget.
The presser offered the institution an opportunity to table a number of other solutions that can help substitute the contraction of loans. They called for some more hygiene in the management of funds borrowed from external partners. “If we borrow money for consumption, we are going into hell. We should use borrowed money for sustainable projects,” the institute said.
Speaking at the event, Hanri Kouam, Economy Policy Analyst, said it is normal to borrow in order to cover up for budget deficits. He said the current budget was elaborated and is implemented at a time when Cameroon faces a number of risks. “In the North We have Boko Haram, we have COVID-19 and the Anglophone quest for its self-identity. And all of these crisis have had an impact on companies in Cameroon, on citizens and on the government because when you have a crisis, you have fewer companies operating,” Kouam stressed.
“The government designed this budget with the intention to respond to all of these crisis and also to make sure that companies were not badly hit by COVID-19 because we had these big lock downs. To respond to this, Cameroon had to go to the international debt market. At least, this was expected.”
On the state of indebtedness, he insisted that: “Borrowing forever is not going to improve our economic situation. What we want our government to do is to improve transparency, accountability and good governance in the implementation of projects. We need to see Cameroonian companies increasingly contracted to execute infrastructure projects.”
The economist indicatedthat Cameroon’s debt situation is quite irritating, but “we are not yet at the end of the world.” Kouam revealed that the current debt level stands between FCFA 10,377 billion and 10,600 billion. “It is worrisome because we have contracted debts and we have not built the roads,” the Economy Analyst stressed.