“Cameroon is a diversified economy with varied sources of resources to finance its economy and budget” says Professor Kelly Mua Kingsley.
The finance engineering expert made the comment following a rating of the country by Moody, as the second most resilient Economy to external shocks in sub-Sahara Africa.
Prof. Kelly says the rating is “very important in showcasing our credibility will” and will “go a long way to facilitate our investment climate.”
So what is the implication of this classification in the financial markets? Read his expert responses to this and two other key questions:
We are all aware of the efforts our regional heads of states are making to bridge the budget gap due to the fall in commodity prices in the world market. Despite the resilience of our economy because of the diversified investment portfolio, other countries have as main sources the finance market.
Without this strong credibility convincing investors becomes a daunting task. Bridging our budget gap through resource mobilisation in the financial market and other external donors will be quite easy.
What are the key components that may have led to this positive rating?
The fact that we have been consistent in our sustainable debt management policy shows we are fully capable of honouring our external engagements. Per the CEMAC regulations, member countries debt portfolio should not exceed 70% of their GDP; our current debt burden situates around 40% of GDP so you can see the margin left.
Secondly our capacity to curb operational and investment expenses was key in sowing our external resilience to economic shocks.
Efforts are being made in this direction already with the payroll clean-up for example. Thirdly the flexibility of our economy is resilient because of its diversification.
It is true Cameroon is to a great extend dependent on commodity prices but lots of other sources from investments finance the economy. Fourthly, we are on an economic program with the IMF, this far three successful evaluations have been made with positive conclusions. This simply tell that our public finance management is on a right tract as we commence perceiving returns on the heavy projects leading to our emergence .
What is your perception on the finance of certain projects with respect to emergence that have been lacking behind?
Turning a blind eye to the delay in executing some of the earmarked projects for emergence will fooling oneself. Challenges are bound due to multiple natural, unforeseen and man-made challenges, the fall in commodity prices after a juicy boom period cannot be undermined for example, the pressure of the CAN projects, the socio-political tensions etc. have had a great impact.
The mood’s report is a litmus test to our resilience to this kind of economic problem, they have even gone further to say we can withstand more complex challenges even though I would pray for stability so that we can start enjoying prosperity.