Central African Leaders Grapple with Economic Headwinds at yaoundé Summit
On December 16th, 2024, leaders from the six nations of the Central African Economic and Monetary Community (CEMAC) gathered in Yaoundé, Cameroon, for an emergency summit. The meeting, convened by Central African Republic President Faustin-Archange Touadéra and hosted by Cameroonian President Paul Biya, aimed to address a growing economic crisis threatening the region.
The summit comes amidst a backdrop of meaningful economic challenges. President Biya highlighted the difficulties, stating, “the international environment has been extremely difficult in recent years and has had a major impact on our public finance. According to recent data, our net foreign assets have decreased considerably. This situation is a cause for concern and it calls for urgent action on our part to reverse this curve.”
While progress was made following a similar summit in 2016, the region faces renewed pressure.Economic growth, while improving from -1.16% in 2016 to 2.7% in 2024, remains fragile. President Touadéra underscored the urgency,noting,”The observed delay in the implementation of our sub-regional economic recovery strategy leads us to the persistence of inflationary pressures,weak consolidation in economic growth,weak consolidation in public finances,depletion of reserves.”
The leaders are especially concerned about the debt burdens of gabon and Congo,two CEMAC member states. The summit’s agenda includes strategies to manage thes debts and prevent a wider financial crisis. President Biya emphasized the stakes, warning that, “if nothing is done, according to various experts we could have a disastrous effect both for our countries and for our sub-region. In my opinion, this is an possibility that we must avoid. I am confident that, at this summit, we can take the necessary and urgent decisions to put our economies back on track to prevent an economic and financial crisis that could be ther.”
President Touadéra stressed the need for collaborative action, stating the summit’s goal is to “assess, discuss and decide together” on the most effective solutions to stabilize the region’s economy and secure long-term macroeconomic benefits. The outcome of this crucial meeting will have significant implications for the economic future of Central Africa and its relationship with the global financial system.
An Interview with World-Today-News Senior Editor on central African Economic Crisis
Mark Thompson (MT): Welcome back to World today. Today we’re talking about teh recent CEMAC summit in yaoundé, Cameroon, where leaders from across Central Africa gathered to address a pressing economic crisis.
Joining us is Sarah Kingsley (SK), our Senior Editor, who has been closely following developments in the region.
Sarah, thanks for being here.
Sarah Kingsley (SK): Thanks for having me, Mark.
MT: Can you give our viewers a brief overview of the situation facing CEMAC countries?
SK: Certainly. For the past few years, CEMAC nations have been grappling with a challenging economic habitat, stemming from both global factors and internal issues. As described by Cameroonian President Paul Biya, the international economic climate has been particularly tough in recent years, impacting public finances and draining net foreign assets[[[[2]. While economic growth has seen a slight improvement since 2016,it’s still fragile,hovering around 2.7% as of 2024. This, coupled with factors like insufficient progress on regional economic recovery strategies[[[[1], has resulted in persistent inflationary pressures, weak public finances, and shrinking reserves[[[[1].
MT: This summit comes just a few years after a similar one in 2016. What makes this situation so urgent?
SK: This time, the situation is particularly acute due to the increasing debt burden weighing down countries like Gabon and Congo[[[[1]. Ther’s a very real fear of a cascading effect, where a crisis in one country could trigger a wider regional financial crisis.As President Biya stressed,inaction could have disastrous consequences for the entire sub-region[[[[1].
MT: What key issues were on the agenda at this crucial meeting?
SK: The main focus was on finding workable solutions to stabilize CEMAC economies and prevent a full-blown crisis. This involved grappling with the issue of managing and reducing debt burdens, particularly in Gabon and Congo. The goal, as articulated by President Touadéra, was to assess the situation, discuss potential solutions, and arrive at a collective decision on the most effective path forward[[[[1].
MT: What are the potential implications of this summit, both for Central africa and the global financial system?
SK: The outcome of this summit could have significant implications. If CEMAC leaders can reach tangible agreements and implement strong fiscal policies, they might avert a severe economic crisis, bolstering investor confidence and promoting regional stability.However, failure to take decisive action could have wider repercussions, potentially destabilizing the region and impacting global commodity markets and financial networks. This is a situation that the international community will be watching closely.
MT: Sarah Kingsley, thank you for providing such crucial insights. It certainly appears to be a pivotal moment for CEMAC nations.
