CEMAC’s Dwindling Economic Fortunes: Cost Of Crude Oil, Insecurity To Blame
BEAC’s Governor made the statement during a meeting with bankers in Douala October 21, 2016.
It is no news that crude oil, the mainstay of economies in the CEMAC zone is going through rough period; drastic drop in prices. The drop in prices coupled with insecurity at the frontiers has a negative impact on the economies of countries in the sub region. During the 8th meeting for 2016 with General Managers of some 52 banking and financial institutions in Douala Octobers 21, the Governor of the Bank of Central African States, who doubles as the President of the Banking Commission of Central Africa, Lucas Abaga Nchama, disclosed that the growth rate of Gross Domestic Product passed in 2014 was 4.7 per cent and later reduced to 2.8 per cent in 2015, and 1.8 per cent has been predicted for 2016.
Though banking activities registered a 1.1 per cent growth rate between July 2015 and July 2016, the Governor said clients deposit reduced to 1.9 per cent during the same period. He regretted that of the 52 banks in the CEMAC zone, just 19 have adequate funds that guarantees financial security of clients according to the Commission’s norms contrary to 24 banks same period last year. However, CEMAC is not the only region hit by the brutal drop in crude oil prices, developed countries, according to the Governor are facing the same problem. To come out of the crisis, he advised states to practice macro economic reforms and to diversify rather than depend only on one or two exports.
Away from banking statistics, the 8th meeting was a rare moment for Lucas Abaga Nchama to list a handful of reforms accomplished during his term of office since 2010. As his term draws to an end, he will be remembered for his reforms towards financial institutions in crisis, and for launching a Regional Bank Card among others. At the end of the meeting, he thanked the General Managers, who according to him contributed in no small way to the coming into light of the reforms and however warned them against false propagation of the commission to the media. During a press conference later, the Governor of BEAC reiterated the need for the banking sector to fully carry out corporate social responsibility in areas they operate.