Tunis, 4 December 2006
– The Board of Directors of the African Development Fund (ADF), the concessional window of the African Development Bank (AfDB) Group, approved on Monday in Tunis a loan of 29 million Units of Account (UA*), equivalent to US$ 43.72 million, to finance a governance reform support program (GRSP) in Cameroon.
The project aims at building the capacities of the structures that will play a lead role in the formulation and implementation of judicial, administrative, public finance control, and anti-corruption strategies as well as policies that will contribute to improving efficiency of key structures charged with implementing the Governance Reform Support Programme (GRSP) and the Revised National Program on Governance (R-NPG).
These structures include: (i) Ministry of Justice; (ii) Permanent Secretariat for Administrative Reform (SPRA); (iii) public finance audit bodies (Supreme State Audit, Audit Bench and Finance and Budget Committee of the National Assembly); (iv) the Public Contracts Regulatory Agency; and (v) National Anti-corruption Commission.
The GRSP aims at supporting the Government in the implementation of its development policy for the period 2006-2008. Its overall objective is to support the Government in its efforts to combat poverty while its specific objective is to contribute to the promotion of good governance in Cameroon.
The medium-term program of the Government of Cameroon, supported by the Poverty Reduction and Growth Facility (PRGF), is centered on the following priorities:
- Consolidation of macroeconomic stability;
- Development of human and physical capital;
- Promotion of good governance;
- Reduction of other obstacles to growth.
The financing requirements for the period 2006-2007 are evaluated at CFAF 1143 billion, emanating from the current account deficit excluding received official transfers of CFAF 584 billion (51.1%); foreign debt amortization of CFAF 463 billion (40.5%); and net foreign reserve variation of CFAF 96 billion (8.4%).
Identified financing estimated at CFAF 633 billion to be derived from official program grants of an amount of CFAF 22 billion (3.5%); CFAF 44 billion as HIPC assistance and relief under the MDRI initiative (7%); current transfers of CFAF 191 billion (30%); capital transfers of CFAF 29 billion (4.5%); v) long-term project loans of CFAF 233 billion (37%); and private capital amounting to 114 billion CFAF (18%).
The financing gap for the period 2006-2007 stands at CFAF 510 billion. This gap should be covered by debt relief granted to the country within the framework of the Paris Club and by other creditors. Bank support will be divided into two tranches of UA 12.5 million each. The IMF will take the two disbursements into account during the presentation of the second PRGF review to its Executive Board.
The AfDB Group began operations in Cameroon in 1972. The Bank’s cumulative commitments in the country currently stand at US$ 1.044 billion in 72 operations.
Country: Republic of Cameroon
Project Title: governance reform support program
Borrower: Government of the Republic of Cameroon
Executing Agency: Ministry of the Economy and Finance Technical Monitoring Committee for economic programs.
Procurement of goods and services under the reform support program: The Bank loan resources of UA 25 million will be used to finance the procurement of eligible goods and services, except for those featuring on the list of non-eligible goods. The goods and services concerned are imported goods and services originating exclusively from Bank Group Member States. All procurements will be done by international competitive bidding for goods and services of an amount of UA 1 million, and by international shopping for any purchases below UA 1 million. As regards goods and services of the private sector, they will be procured according to trade practices in force in Cameroon deemed acceptable by the Bank.
* 1 UA = 1.50773 US$ = 749.247 CFAF as at 4/12/2006