Alamine Ousmane Mey, Minister of Finance, talks on Cameroon's borrowing drive.
Your Excellency, what has motivated the launch of the fourth operation during this year 2016?
As you have stated correctly, we are gunning for another FCFA 150 billion this year. With a net interest of 5.5 per cent per year (tax exempt) from September 27 to October 12, 2016 during five years. The subscription period may be extended or reduced after consultation with the Financial Market Commission. The operation will help raise funds that will be used to finance the projects listed in the 2016 Finance Law. These projects are vast infrastructural projects which seek to create jobs and enhance growth as found in guidelines of the country’s Growth and Employment Strategy Paper. It also falls within the 2035 Vision for an emergent economy as underscored by President Paul Biya. Cameroon is embarked on the success of this Vision.
It means creating a better and conducive environment for the construction of our nation and development of companies. We need resources for that. We need to accelerate our development based on infrastructures needed to really push forward our development. This is the reason why we have come back to Douala for the fourth time. We have always been successful in Douala.
Is there any change in the method of operation as far the current operation is concerned?
Of course, yes! In order to guarantee the confidence investors have for us the bond will be repaid by debiting the escrow account opened by the State of Cameroon with the Bank of Central African States, BEAC, as indicated in the security package. The Ministry of Finance has undertaken to provide the funds needed to cover each yearly payment prior to each maturity date. As the maturity date draws nearer, coupons will be paid and the principal repaid following a payment system implemented by the Central depositary and the Settlement Bank.
Can investors rest assured of repayment?
We want all local and foreign investors to know that each time they take such an engagement with Cameroon they should be assured that Cameroon respects its engagement. Our past three operations have been successful. It is evidence that the risk of investing in Cameroon is well appreciated by the investors. They know that measures are taken to properly ensure the repayment of these bonds issued by the State of Cameroon.
For the FCFA 150 billion announced we are proud to say that FCFA 112 billion is already subscribed, which again is a clear proof there is trust on the government of Cameroon. With an interest rate of 5.5 per cent tax exempt, it is a sure instrument for those who want to put their money both for the financial return as well as for the support of the development of the nation. This is the partnership with investors in Cameroon and abroad with the Cameroon government to make sure that our projects are properly realised. And our population will take advantage of the realisation of these projects to have better living conditions.