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CEMAC economic recession could hit 6% according to BEAC

The Bank of Central African States BEAC has announced that economic recession in the sub region could reach 6%  At the end of the second session of the Monetary Policy Committee CPM, experts decry the adverse impact of the coronavirus on the CEMAC economy.

“In the first half of 2020, the revival of productive activities was slowed down in the sub-region by the disruption of supply circuits for imported products as well as by the restrictive measures adopted by the various governments to contain the effects of the pandemic. Although it is for the moment premature to fully apprehend the impact of COVID-19 on national economies, it is already anticipated during this first semester a drop in production as well as a deterioration of public finances and external accounts, ” the Central Bank said.

For the year as a whole, development prospects will depend on the average price per barrel of crude oil and the duration and international response to the health crisis.

According to the central scenario, an economic recession of 5.9% is forecast, a slight inflationary rise to 2.5%, that is to say below the Community standard which is 3%, a deterioration in the budgetary balance , commitment base at -6.2% of GDP (Gross domestic product), a significant widening of the current account deficit to 7.3% of GDP and a rate of coverage of the currency which would resell at 55%.

Taking into account the evolution of the health situation, the impact of which is significant on economic activities, the CPM decided to keep unchanged the Interest Rate for Tenders (TIAO) at 3.25%, the Rate of the marginal lending facility at 5.00%, the deposit facility rate at 0.00% and the reserve requirement coefficients at 7.00% on demand liabilities and 4.5% on term liabilities.