CEMAC Seeks To Reform Macroeconomic Tools
Experts are meeting in Yaounde to see how the budgetary policy can be in coherence with the needs of the bloc’s monetary policy.
The
six countries (Cameroon, Chad, Central African Republic, Equatorial
Guinea, Gabon and the Republic of Congo) of the Economic and Monetary
Community of Central Africa, CEMAC, are rethinking the scope of the
multilateral surveillance, put in place some 15 years ago to ensure that
risks from capital flows are adequately
addressed. Experts from the six
member States alongside technical partners started meeting yesterday
July 21, 2015 in Yaounde, under the chair of Cameroon’s Minister for
Finance, Alamine Ousmane Mey.
In the year 2000, the summit of Heads of State in N’Djamena Chad
endorsed the multilateral surveillance document with focus on
harmonising economic and budgetary policies. Fifteen years down the
lane, experts say the context has changed. When the document was
approved prior to the Highly Indebted Poor Countries HIPC Initiative,
the criterion for public debt rate was less than 70 per cent of Gross
Domestic Product. When the HIPC came in, the first outcome was the
cancellation of debts.
The 70 per cent allowance allowed for public debts is no longer
constraining. In addition, the level of dependence on oil revenue for
economies today is far from what held when the mechanism was put in
place. The level of reliance on oil revenue has improved. Fluctuations
on the international market with the current fall in oil prices are
among reasons that have pushed CEMAC countries to reform the 15-year-old
instrument.
From the Minister for Finance, Alamine Ousmane Mey, to the President
of the CEMAC Commission, Pierre Moussa and the Commissioner of CEMAC,
Paul Tasong, countries of CEMAC have a common monetary policy and it
beholds the institutions of the community to ensure coherence and
stability. They cautioned the fact that CEMAC countries have a common
currency and there is need to ensure that it is sustained over time. The
need to ensure that the region’s budgetary policy is in coherence with
the wishes of monetary policy is therefore indispensable. Having mastery
on inflation and readjusting macroeconomic tools are prerequisites for a
better business climate for investors.
The Yaounde confab is not in any way coming to solve problems which
according to CEMAC officials do not exist. “We don’t look for solutions
only to problems we see but we could also anticipate problems,” notes
Paul Tasong. Notwithstanding, Pierre Moussa put stress on the fact that
the context has changed. The
rise in insecurity in the Central African Republic, host to the CEMAC
head office as well as the resurgence of Boko Haram terrorist attacks in
Cameroon’s Far North coupled with the financial constraints faced by
oil producing countries of the economic bloc is impacting on investment
programmes. This therefore calls for need to reform the region’s
multilateral surveillance policy. The Yaounde high-level meeting which
is holding on the theme, “Multilateral Surveillance in CEMAC:
Experiences and Perspectives” ends on July 23, 2015.
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