19, July 2023
Cameroon opened, Monday (July 17), subscriptions to its 13-week treasury bills (T-bill) on the central bank BEAC’s money market. The subscriptions, which will close today (July 19), aim to fetch the country a CFAF10 billion envelope to pay off a CFAF8 billion debt contracted 26 weeks earlier.
This new fund-raising follows Cameroon’s first major success in that market since January 2023. Indeed, after several unsuccessful operations, on July 10, at the end of a 26-week T-bill issue, the country attracted CFAF54.5 billion in subscriptions, higher than its CFAF50 billion target.
To keep the weighted average interest rate at 5%, the country retained just CFAF49 billion. It is worth noting nevertheless that to attract investors, Cameroon agreed to a 5% interest rate on its short-term securities, which is the same rate it was offering for 4-year bonds ten days earlier. The rate is higher than the 3% it used to offer investors for the same type of security in the same market.
To succeed in its fundraising operations, Cameroon is adapting to the generalized rise in interest rates in that market following the tightened monetary policy adopted by the BEAC. It will surely do the same for the ongoing issue.
Source: Business in Cameroon