The head of states gave the go ahead since Tuesday 23rd August 2022, via a presidential fiat. The loan is meant to finance the development of several projects which are still on hold.
This decree stipulates that these funds are strictly for project development and he charged the Minister of Finance ” to resort, on behalf of the government, to the issuance of public securities, particularly treasury bonds, for a maximum additional amount of 200 billion CFA francs, intended for development of project as prescribed in law No 2022/011 of July 14th, 2022”. The new loans that Cameroon is preparing to contract will certainly increase the country’s public debt, but the state is forced to do so.
The daily newspaper Guardian post reports that the said projects needs additional resources to continue the execution of some of its structural projects, the implementation of its costly fuel subsidy policy, as well as partial settlement of debt owed teachers. They add that the government plans to spend 31 billion F CFA in 2022, to satisfy teacher’s demands. Meanwhile their union claim over 12890 billion fcfa from the state.
Moreover, the Russo-Ukrainian war has led to the increase of prices on the national and international market hence the increase in prices in the local market. The said subsidies currently amounts to 480 billion FCFA for fuel instead of the 120 billion FCFA provided for the initial 2022 budget law. The rest of the year will sum up to n 780 billion fcfa according to government forecast. Reports say it is a direct effect of an increase in the international price of oil.
Wheat has also being subsidized by 5 billion FCFA every month since july 2022 at the rate of 2,500 francs per 50kg bag. This loan is primarily meant to cover urgent matters like,th e teachers plea to the government.