(Business in Cameroon) – Yesterday, during a presentation of the state’s financing program for the year in Douala, Cameroon’s Finance Minister revealed that the interest rates paid by the country on its Treasury Bonds (BTA) have significantly increased from 2020 to 2024.
Louis Paul Motazé explained that the returns on these short-term securities, which are used to raise funds for managing temporary cash flow shortages, have risen from 2.67% in 2020 to 6.33% in 2024. This represents a more than 100% increase.
Along with the rise in interest rates, the coverage rate for the funding demand expressed by the Cameroonian Treasury has also dropped over the same period. According to the data shared by Motazé, this coverage rate fell from 206.9% in 2020 to just 69% in 2024.
In other words, while in 2020 investors were generally offering up to three times the amount Cameroon requested, allowing the country to pick and choose among the offers, now the total subscriptions from the same investors only cover just over half of the funding demand. This decline indicates a decrease in the attractiveness of Cameroon’s issued bonds.
Motazé did not provide specific reasons for the drop in investor interest in Cameroonian bonds. However, this could be linked to Cameroon’s cautious approach to interest rates on the public bond market. Although the rates have increased, they remain the lowest on the market, which may not appeal to investors who are increasingly drawn to higher-yielding investments.
