Cameroon’s National Sinking Fund (CAA) has revealed that, as of September 30, 2024, debt contracted by the Cameroonian government and transferred to public companies has reached CFA984.7 billion. According to CAA’s latest report on Cameroon’s public debt, this amount stood at CFA1.518 trillion at the end of 2023, is distributed among eleven state-owned enterprises.

The companies include Camwater, which manages the public water supply; Camtel, the national telecom provider; Sodecoton, a major player in the northern agro-industrial sector; Chantier Naval et Industriel du Cameroun (CNIC); Electricity Development Corporation (EDC), which oversees electricity assets; Sonatrel, the electricity transmission company; Sonara, the oil refinery; Campost, the postal service; Alucam, the aluminum giant; The National Real Estate Company (SIC); and Cameroon Civil Aviation Authority (CCAA).

Four among them account for over 80% of this debt, totaling CFA797.3 billion. Camtel leads as the main beneficiary, with CFA280 billion as of September 30, 2024, down from CFA312 billion at the end of 2023, marking a repayment of CFA32 billion over nine months. Following Camtel, Camwater’s debt stood at CFA222.2 billion, down from CFA229.6 billion at the end of 2023. Sonatrel saw its debt increase from CFA154.4 billion in December 2023 to CFA175.7 billion, while EDC reported a slight decrease from CFA121.1 billion to CFA119.4 billion in the same period.

Debt Concerns and Financial Ratings

The rising debt levels of Cameroon’s public enterprises have increasingly concerned the government and development partners. These debts, often backed by state guarantees, could strain the national budget if the companies fail to meet their repayment obligations, placing the burden on the national Treasury.

To mitigate this risk, the government is working to guide public companies—typically producing what the IMF called “poor results”—toward non-sovereign loans from development partners. In June 2015, the Ministry of Finance organized a workshop for leaders of seven public companies, including Camtel, Aéroports du Cameroun, Sonara, Feicom, Port Authority of Douala (PAD), Camwater, and the Cameroon Oil Depot Company. This session focused on mechanisms for accessing non-sovereign financing from the French Development Agency (AFD).

However, nine years after this workshop, only Camtel and the Port Authority of Douala have undergone a financial rating with Bloomfield Investment. This step is crucial in assessing a company’s credit profile before seeking capital market funding.

Source: Business in Cameroon