Business

For some years now, the contribution of local banks to financing the economy has been increasingly visible. The national financial and monetary committee in its recent report saluted the improved performance thanks to the new-found relationship between the State and the banks. According to the report, internal loans increased by 15.1 per cent between March 2014 and 2015. In effect, the amount of internal debts rose from FCFA 2,017.1 billion in March 2014 to FCFA 2,322.1 billion during the same period in 2015. This is justified by increased funding of the economy by local banks through the various financing modes sought by government. Meanwhile, external debts dropped by 1.8 per cent.

The report cannot be surprising for those who have been keeping track of national economic performance of late. Since 2010 when government raised over FCFA 200 billion in the money market in less than two weeks, the trend has been improving by the day. Government is increasingly embracing the sale of treasury bonds and other operations in the money market to run the economy and finance growth-induced projects. For instance, in the 2013 Finance Law, government projected to raise FCFA 250 billion from the money market through the issuance of different bonds. The amount rose to FCFA 280 billion in 2014 and over FCFA 320 billion this fiscal year. A recent ordinance of the Head of State gives finance authorities the leeway to take concessional loans to the tune of FCFA 500 billion and non-concessional loans to 1,200 billion. 

The ground is fertile for the harvest. All these because of government’s resolve to get the private sector onboard the development train on one hand, and the confidence the banks have on government on the other. To say the least, mutual trust has been restored between the two. Salutary indeed! The time taken to raise money from the local banks, like is the case now, is shorter and sometimes less strenuous compared to going to donor agencies to get similar funding. The performance of the local banks augurs well for the local economy given the international economic environment characterized by crises, especially those in the Eurozone. In fact, it is telling of Cameroon’s capability to wither the storm, stand strong in the face of global economic hazards and pursue her emergence drive without much difficulty all things being equal. The mutual confidence exhibited in the chunk of money pumped into the economy from within also comforts the inclusive growth policy highly sought for by public authorities.

But the euphoria surrounding the government-bank new posture relationship to keep the economy buoyant shouldn’t veil the fact that what banks give out are not gifts but loans which must be paid back. Banks are not and shall never be philanthropic organizations. They do not even fabricate money but rather sell what they get from their clients to make gains. As such, borrowers like the State now, must have feasible projects on which the loan would be used. Better still, once borrowed, the money should be used on the identified projects so that when the time comes to refund, the State would not need to rob Peter to pay Paul. Up till now, the loan refund has not posed any problem as both parties are reportedly keeping to the terms of their agreement for the good of all. Borrowing is inevitable for a State that wants to evolve especially in the face of increasingly scarce financial resources. Having the assurance that you can turn left and right and have what you need is more than heart soothing. There is therefore need to maximize the existing opportunities offered by the banks’ confidence and move the economy forward.

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Ngwa Bertrand

18.Aug.2015

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Iran’s media are reporting that the US administration has given an authorization to the country’s oil clients to continue purchasing crude oil beyond the ceiling that had been imposed as a result of sanctions. Mehr News Agency says the US Treasury and State departments in a recently published have ensured that Tehran's oil customers can continue to purchase Iranian crude during an interim period before the terms of what Iran and P5+1 agreed on in Vienna last month can be fully implemented and sanctions lifted.

Both departments in the guidance that was originally brought to the spotlight by Argus Media publication have emphasized that Washington will not impose sanctions on financial institutions in those countries. And the US will not target non-US companies that help facilitate those purchases, it was further reported. During the nuclear negotiations, Iran's oil exports have been limited to 1mn-1.1 million barrels per day (mbpd), down from 2.5 mbpd before the sanctions were imposed in 2012. Six countries — China, India, Japan, South Korea, Taiwan and Turkey — buy oil from Iran. 

Iran’s Oil Minister Bijan Zangeneh had earlier emphasized that Iran is ready to increase its oil production by at least 0.5 mbpd as soon as the sanctions against Iran are lifted. Zangeneh also said he had told OPEC to make room for the extra Iranian oil supplies, stressing that Tehran wants to regain the market share it lost as the result of the US-engineered sanctions.  Iran and the P5+1 group of countries – the US, Britain, France, China, Russia plus Germany – announced in Vienna on July 14 that they had agreed over the removal of economic sanctions against Iran in return for certain steps by the country to limit its nuclear energy activities. A crucial part of the sanctions concern those that ban purchases of oil from Iran beyond a ceiling of 1-1.5 mbpd as well as those that ban investments in Iran’s oil industry. 

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Ngwa Bertrand

11.Aug.2015

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Ford Motor Company (F:N) will start assembling its best-selling Ford Ranger pickup truck in Nigeria by the fourth quarter, as it expands in Africa and the Middle East, the U.S. automaker said on Tuesday. The Nigerian assembly plant, in partnership with Ford dealer Coscharis Motors Limited, is the first outside South Africa, where Ford produces the Ranger for 148 markets. "Nigeria is a priority market for us in sub-Saharan Africa," said Jeff Nemeth, the president and CEO of Ford Motor Company's business in sub-Saharan Africa. "Depending on how Nigeria develops over time ... we are potentially looking at using our Nigerian plant to service West Africa," he told Reuters. 

The auto market in Africa's biggest economy has huge potential but retails only a small amount of new vehicles annually, Nemeth said. He said the sector is dominated by imported used vehicles, while limited financing for consumers to buy new vehicles and the absence of an industrial policy that would encourage suppliers to set up in Nigeria have stunted growth. The Ikeja plant near Lagos will assemble the Ford Ranger using parts and components imported from South Africa. The plant will have the capacity to assemble up to 5,000 units annually, which will be sold in Nigeria.

Ford produces 85,000 units each year in South Africa, which are sold across 24 African countries. "It would take between 1 to 2 months to take an order, build it and deliver it within the country. If you order from overseas it would take between 4 to 6 months," Nemeth said, noting that the benefit of the Nigerian plant was being close to its customers. Rival automakers, Renault-Nissan, South Korea's Kia Motors (000270.ks) and Germany's Volkswagen (VOWG_p.DE) have announced plans to assemble vehicles in Africa's most populous nation.

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Ngwa Bertrand

11.Aug.2015

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Nautic Africa has launched two 35 metre Sentinel vessels for a Nigerian customer, after laying their keels in December last year. The vessels are expected to arrive in Nigeria on 25 August. Nautic Africa, a Paramount Group company, launched the two new vessels, Augustina II and Princess Ebikenie, in Table Bay Harbour last week. They are capable of top speeds of 29 knots, and can reach 26 knots when fully fuelled – even with the weight of additional ballistic panelling throughout the deck level.

The 108-tonne aluminium-hulled vessels have been designed with versatility in mind and feature a number of significant improvements to Nautic’s standard Sentinel model, the company said. Both vessels are capable of staying at sea with a full crew and security team complement of 16 to 18 people for four weeks at a time without refuelling when conducting a security patrol or escort function.

This capability is facilitated by the four main fuel tanks and day tank with a combined capacity of 56,000 litres. In addition, a large walk-in fridge and freezer provide capacity to produce 3,000 litres of water a day using the onboard desalination plant.

Enhancements for PLC alarm monitoring and tank level sensing are accomplished throughout the vessel via colour Human Machine Interface (HMI) touch screens. Six CCTV cameras feed directly to the Captain and Chief Engineer’s cabins as well to the bridge. This, coupled with the intercom system, gives the crew the ability to communicate well in any emergency. The Captain is also able to view the chart plotter display in his cabin.

In addition, the surveillance capacities of the Augustina II are enhanced with the fitment of a 92-nautical mile range S-Band Radar. This technology gives the crew the ability to detect objects in areas during heavy rainstorms – a capability critical to the equatorial waters where she will be operational.

Outfitted for safety during crew transfers, Princess Ebikenie features a ballisitically protected crew transfer seating area containing 40 IMO (International Maritime Organisation) rated seats. Access at the forward section of the seating area provides entry to the vessel’s bow, which has been specifically designed for the safe transfer of crew via platform-access ladders. To facilitate safe docking and transfers, two 35 kW electric bow thrusters have been fitted, providing redundancy and fine bow control in windy conditions or areas with strong currents.

Nautic Africa concluded a R600 million deal in mid-2013 to build seven of the 35 m multi-role patrol vessels for West African clients. The first of class, MV Sir Emeka Offor, was launched in August 2014. Given the area that the vessel will operate in, the vessels features composite ballistic protection, with the wheel house capable of stopping a projectile fired by an AK-47. The vessel is also fitted for, but not with, defensive weapons. Driven by three Caterpillar engines, the vessel has a crew of eight and can accommodate 18 passengers at a maximum speed in excess of 28 knots.

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Ngwa Bertrand

08.Aug.2015

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The Ministry of the Economy, Planning and Regional Development has embarked on a national campaign to evaluate the performance of public establishments within its quest to measure strides of the December 26, 2007 Financial Regime reforming the budgetary system. The ministry, since 2007, when the law on the results-based budget was promulgated was expected to evaluate the performance of public structures each year with the view of better planning and programming of the country’s yearly budget.

The operation to appraise the coherence of the budget of public establishments with the notion of results-based programme budget is therefore in its maiden edition. A team from the Department of Economy and Programming of Public Investments in the Ministry of the Economy, Planning and Regional Development with the support of experts from the National Institute of Statistics and the Technical Commission for the Rehabilitation of Public and Para-public Enterprises has been charged with the exercise. Correspondences were dispatched to companies on July 6, 2015 and the Minister of the Economy, Planning and Regional Development, Emmanuel Nganou Djoumessi signed a press release on July 27, 2015 urging companies to remain flexible and in so doing support government in its desire to succeed in its reform implementation.

Information from the Directorate of Economy and Planning of Public Investment reveal that the exercise is in two forms. Forms are handed out to companies whereby the staff of the personnel departments involved list the number of indicators and the level to which they have been achieved. Other companies organise working sessions with the field teams whereby the same information is handed out. The Ministry is working to evaluate the performance of 2013 and most especially, 2014 budgetary year of public companies with focus on better planning and budgeting for 2016. The operation is also geared at assessing the budgetary indicators of companies to see how far they have helped in attaining budgetary objectives. 

Analysing the evolution of the indicators and the achievements thus far is also a guiding principle towards ensuring that budget execution is development-oriented. Data collected is expected to serve as a guiding annual document that will henceforth be produced. Government says every structure that is run with public finances through subventions and budgetary allocation is predisposed to result-based management assessment contrary to the hitherto physico-financial control whereby stress was on the level of execution of budget and achievements without any impact to the livelihood of Cameroonians. The new operation focuses on how important projects executed have had an impact on livelihood.

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Ngwa Bertrand

07.Aug.2015

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Vietnamese Viettel mobile network operator that functions under the Cameroon Nexttel brand, recently announced that the company has already invested more than 200 billion CFA Francs throughout the national territory in just ten months of its activity. The heavy injection of capital has led to a significant development of their network and enabled among others the setting up of 1200 BTS stations and 1600 sites that allows Cameroon's third mobile operator to reach out to all the 10 regions of the country. 

Cameroon Concord understands Viettel is the first holder of a 3G license in Cameroon and has made major strive in its struggle to find its foot on a national mobile telecom market controlled since 2000 by MTN and Orange. In May 2015, Nexttel reported that it had gotten 2 million subscribers against 10.1 million for MTN Cameroon and 6.2 million subscribers for Orange Cameroon. The Vietnamese company obtained its license in 2012 but launched its activities only in September 2014.

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Ngwa Bertrand

05.Aug.2015

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