According to the Minister of Finance of Cameroon, the CEMAC states are working to mitigate the effects of the coronavirus on monetary parity.
“The risk that hung over our heads about the devaluation has been somewhat removed,” Cameroon’s Minister of Finance said in an interview with the national daily Cameroon Tribune this week. Louis Paul Motaze responded to the hypothesis of a new devaluation of the FCFA made by BEAC in its report on monetary policy published on April 27. According to the issuing institution, the health crisis that is hitting CEMAC’s economies head on could expose the subregion to the same depressive scenario of 2016 with the possibility of another devaluation in mind. A scenario that the Cameroonian Minister of Finance does not envisage.
According to him the situation of 2016 has already been evacuated. “The measures that the Heads of state had taken in December 2016 have had an effect. We had reached a level of reserves that hovered around two months and that was really dangerous equivalent to two months of imports, a slight increase. We were already at 3.5 we were going towards 4 months and Cameroon alone was already around six. This is why, we think, the risk that hung over our heads has been somewhat wiped out, “he said.
Regarding the risks of a further devaluation of the currency due to the disastrous consequences of the Covid-19 pandemic on the economies, the MINFI does not believe in it. “The heads of state posed another problem rather with regard to the FCFA, work which was placed under the responsibility of the President of the CEMAC Commission and the governor of BEAC. It is now happening that there is a crisis of which nobody knows yet the ultimate consequences but it would surprise me that the answer is only that “he affirmed before adding” the States are working to mitigate the effects of this crisis. “
To avoid the scenario of devaluation, BEAC made some recommendations for CEMAC states. Among other things, this involves “identifying support measures for businesses that will be affected by the crisis and aligning public financial management with up-to-date and realistic forecasts of budget revenues”. In the direction of credit institutions, it recommends “supplying their customers with sufficient monetary signs, in particular by ensuring the availability and proper functioning of their network, including ATMs, guaranteeing the supply of all services and strengthen the operations of remote banks and lower the conditions of banks BEAC prescribed in the direction of States.
