The Republic of Congo will launch, on Monday, a bond issue by public offering in the amount of FCFA 100 billion on the regional financial market of the Economic and Monetary Community of Central Africa.
Referred to as “EOCS 6.25% NET 2021-2026”, this bond issue carries a net interest rate of 6.25%. The operation aims to finance projects that aim to contribute to the economic and social development of the country, as well as to the partial clearance of domestic debt. With regard to domestic debt clearance, these resources should promote the revival of aggregate demand and improve public finance management.
The projects benefiting from this bond loan are, according to the Ministry of Finance and Budget, in the areas of road, health, school, energy and forest economy infrastructure.
“On the basis of the last National Development Plan (2018-2022), the funding that will benefit the Congolese State will enable it, in line with an economic situation that promises to be better, to mobilize its forces to improve governance and strengthen capital human resources and diversify the country’s economy, ” the Minister of Finance and Budget, Calixte Nganongo said in a press release.
The nominal value of the securities for this bond loan is 10,000 FCFA, with a capital deferral period set at two years. For the success of this issue, the Republic of Congo is supported by Ax Capital Corporation for the consulting part with as arranger and leader the company Ess Bourse based in Douala, Cameroon.
To secure repayments, the Ministry of Finance and Budget has set up a security mechanism through the opening of a sequestered account at the Bank of Central African States.
The option taken by the Congolese government for this bond issue takes into account the contraction in national economic activity aggravated by the Covid-19 pandemic. It also stems from the need to restart development financing, with a view to a sustainable and inclusive economic rebound, with a view to fostering non-oil growth.
