Cameroon is pursuing innovative financing strategies, particularly structured finance, to fund its National Development Strategy (SND30) by 2030. A seminar organized by GM Finance emphasized understanding these complex financial instruments. The government plans to borrow CFA1.795 trillion by 2025, as it explores alternative funding sources, including securitization, to meet its ambitious goals.
Cameroon is actively seeking significant funding to achieve the targets outlined in its National Development Strategy (SND30) by 2030. Due to limited domestic resources and constraints in accessing traditional financial markets, the nation faces challenges in bridging the financing gap. Consequently, Cameroon is exploring alternative financing mechanisms, particularly structured finance, which was the focal point of a seminar held in Douala from February 26 to 28, 2025, organized by GM Finance under the auspices of the Ministry of Finance.
The seminar’s objective was to enhance the understanding of structured finance among financial professionals representing government agencies, state-owned enterprises, private firms, multinational corporations, and banks. Hubert Otele Essomba, an associate director at GM Finance, emphasized that structured finance encompasses sophisticated financial instruments that integrate loans, equities, bonds, and derivatives to craft customized financial solutions. Notable instruments within this category include public-private partnerships (PPPs), hedge funds, sovereign wealth funds, securitization, and credit ratings.
The Ministry of Finance and financial experts have concurred on the necessity for Cameroon to investigate these alternative funding avenues to meet liquidity demands. This discussion is taking place against a backdrop of the country’s debt level remaining significantly lower than the regional threshold of 70%. For 2025, a pivotal year for Cameroon’s development ambitions, the government aims to raise CFA1.795 trillion in debt, allocated with 70.8% for project loans and 29.2% for budget support.
Between 2025 and 2027, Cameroon anticipates borrowing CFA5.407 trillion to finance its development needs. To procure these funds, the country must transition from traditional financial avenues to innovative mechanisms that reduce risk while enhancing returns. Essomba noted the potential for employing sovereign wealth funds, pension funds, and bonds, all of which offer greater adaptability. He remarked, “There is plenty of funding available on the international market. However, Cameroon must develop strong financial engineering and create an attractive environment to draw in these funds.”
Securitization emerges as a promising mechanism for financing development projects. Catherine Gerst, an expert in financial strategy and former managing director of Moody’s France, stated, “What makes securitization unique is that it allows institutions to leverage the assets on their balance sheets—credit portfolios for banks or receivables for companies—by selling them to a special-purpose entity that raises funds from the market. This transforms illiquid assets, such as receivables, into tradable securities.”
In summary, structured finance and innovative solutions like securitization offer a potential pathway for Cameroon to mobilize the resources necessary to fulfill its ambitious goals set forth in SND30. Achieving this will require robust financial expertise, transparent governance, and a conducive business environment to attract international investment.
In conclusion, Cameroon is actively seeking innovative financing strategies to meet its development targets outlined in the National Development Strategy (SND30) by 2030. The exploration of structured finance and mechanisms like securitization presents a viable approach to bridge funding gaps. However, successful implementation will necessitate strong financial infrastructure and a transparent, investor-friendly climate.
Original Source: www.businessincameroon.com
