Eurobond : Cameroon unable to achieve target

Instead of the USD 1.2 billion expected at the end of the first issuance of Eurobond by Cameroon on the international capital market, the country only managed to get USD750 million (approximately FCFA 375 billion, with USD 1=FCFA 500).

At the beginning of the operation, it was USD1.5 billion.

This what Cameroonian financial engineer, Babissakana, revealed, citing Bloomberg Agency in an open letter addressed on November 25, 2015, to the Finance Minister, Alamine Ousmane Mey, to express his indignation on this "failure" registered by the Public Treasury of Cameroon for its very first experience on the international market.

In an article published on November 13, 2015, on the Bloomberg website, and entitled "Investors giving the cold shoulder to first Eurobond", LyubovPronina announced the first international bond issuance of Cameroon was only subscribed at 50%, the country having only raised USD 750 million on a USD1.2 million issuance (FCfa600 billion).

However, the specialised website Global Capital had announced a subscription rate of 98% a few days earlier.

Though they disagreed on the subscription rates and consequently, with the final amount collected by Cameroon, both sources agreed on the 9.75% interest rate.

This interest rate, Bloomberg stressed, annihilates the performance targets that Cameroon had set for this operation. This specialised agency moreover noted the unavailability of the Cameroonian Finance Minister to comment on this less than brilliant operation.

In Cameroon, mystery still shrouds this Eurobond issuance. No official information has been released. At the ministry of Finance, there is total silence.

At parliament, where the 2016 budget is currently under review with part of its revenue coming from this Eurobond, the appearance of the Finance Minister before the Finance Commission was highly awaited on November 25 with the hope of shedding more light on the issuance of this Eurobond crucial to the success of the 2015-2017 government emergency plan, whose financial requirements are estimated at FCfa925 billion.