Biya regime delays bond sale amid regional market strain 0

The Cameroon government has postponed its planned 2024 bond sale, originally slated for April, due to market saturation caused by Gabon and the Central African Development Bank (BDEAC). A source within the Ministry of Finance Treasury Department revealed ongoing negotiations for the delay.

With regional capital markets facing adversity, marked by difficulty in accessing funds, Cameroon opts for caution, refraining from pursuing significant borrowing. Gabon and BDEAC, preceding Cameroon with bond issuances totaling CFA200 billion earlier in 2024, faced challenges in attracting subscriptions, leading to extending their bond closure dates.

Despite offering various interest rates and maturity terms, both Gabon and BDEAC had to prolong their bond subscription deadlines due to underwhelming responses from investors. This move aims to grant them more time and a better opportunity to attract hesitant investors.

In light of this cautious market environment, Cameroon, accustomed to controlled interest rates, refrains from significant borrowing. The country’s preference for controlled rates contrasts with the current trend of rising interest rates, a consequence of the Central African Central Bank’s austerity monetary policy to combat inflation by tightening liquidity. Amid uncertain market conditions, Cameroon prepares to preserve its treasury amidst difficulty in accessing fresh funds. The government plans to repurchase certain bonds issued on the regional market, scheduled for early May, totaling between CFA150 billion and CFA200 billion. This strategy aims to extend repayment dates for bonds nearing maturity, ensuring liquidity for essential priorities.

Source: Business in Cameroon