Cameroon’s Rising Debt: The Borrowing Paradox
By Ernest Chefon Ndukong
Cameroon’s public debt has once again moved to the center of national debate following the authorization of more than CFAF 2.3 trillion in new loans between September 2025 and January 2026. This comes to add to the already huge debt stock, raising concerns among citizens about sustainability, transparency, and tangible development outcomes.
Yet, economists caution that the issue is not borrowing itself, but rather how borrowed funds are selected, executed, and managed.
Borrowing Is a Development Tool, Not a Failure
Like most developing economies, Cameroon relies on borrowing to finance infrastructure, social services, and budgetary gaps. Roads, ports, power plants, hospitals, and schools often require large upfront capital that domestic revenues alone cannot support. External financing also helps governments respond to shocks such as global pandemics, security challenges, and climate-related disruptions.
In this sense, public debt is a normal and often necessary policy instrument. Problems arise when the returns generated by loan-financed projects fall below the cost of the debt used to fund them.
When Debt Stops Delivering Growth
Several factors weaken the impact of public borrowing in Cameroon. These include weak project preparation, delays in execution, cost overruns, governance failures, and poor monitoring of outcomes. In some cases, loans are contracted for projects that do not significantly improve productivity or economic capacity.
The consequence is a dangerous imbalance: the country incurs repayment obligations without generating the growth needed to service them. Citizens then bear the burden through higher taxes, reduced public services, or constrained future investment.
The Problem of Undisbursed Loans
A recurring concern is the growing volume of loans that remain partially or entirely undisbursed. This situation often stems from procurement delays, lack of counterpart funding, administrative bottlenecks, or failure to meet lender conditions. Despite the absence of actual cash inflows, commitment fees and charges continue to accrue, increasing debt without corresponding benefits to the economy.
Why Printing Money Is Not an Option
Some citizens ask why the government cannot simply print money instead of borrowing. The answer lies in Cameroon’s monetary framework. As a member of the Central African Economic and Monetary Community (CEMAC), Cameroon does not control its currency independently. The CFA franc is issued by a regional central bank and pegged to the Euro.
Uncontrolled money creation under such a system would fuel inflation, weaken external reserves, and threaten monetary stability. Borrowing, therefore, becomes the primary financing option, though one that must be carefully managed.
Risks of Debt Distress and Default
Failure to meet debt obligations would have serious consequences. A default would restrict access to international credit markets, raise import costs, weaken the banking system, and likely trigger austerity measures under international financial assistance programs. Cameroon has experienced such adjustment periods in the past, with significant social and economic costs.
Limits of Domestic Borrowing
While the government does borrow from local banks, domestic financing has limits. Excessive reliance on local banks can crowd out private sector credit, raise interest rates, and expose the financial system to sovereign risk. Domestic borrowing alone cannot meet the scale of Cameroon’s development needs.
Lessons from Elsewhere
International experience shows divergent outcomes. Countries such as Kenya have faced rising fiscal pressure due to heavy borrowing combined with weak project returns, while others, like Rwanda, have demonstrated that disciplined borrowing aligned with strong execution and accountability can yield visible development gains.
A Question of Governance, Not Access to Funds
Ultimately, Cameroon’s debt challenge is less about the volume of borrowing and more about governance. Strengthening project appraisal, enforcing transparency, publishing execution reports, and subjecting loan-financed projects to independent audits would significantly improve outcomes.
Public borrowing can accelerate development, but without discipline and accountability, it becomes a silent burden on future generations. The central question is no longer how much Cameroon borrows, but what the country gains in return.
“He who borrows a drum must return it without a tear.”
