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PRIME MINISTERS OFFICE--------------CABINET

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REPUBLIC OF CAMEROONPeace-Work-Fatherland

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PRESS RELEASE

FOLLOWING THE CABINET MEETING

OF THURSDAY, 31 OCTOBER 2013

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Yaounde, 31 October 2013

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The Prime Minister, Head of Government, Mr Philemon YANG,today,Thursday 31 October 2013 as from 11:00 a.m. in the main building of the PrimeMinisters Office, chaired an important Cabinet Meeting. In attendance were the

Vice Prime Minister, Ministers of State, Ministers, Minister-Delegate and

Secretaries of State.

Proceedings centred on the evaluation of the first year of implementation of

the programme budgeting format and ownership of the FY 2014 Finance Bill. Thefollowing two statements were presented in that regard:

1.a statement by the Minister for Finance on: the Stakes and ProspectsFY2014 Finance Bill;

2.a statement by the Minister for the Economy, Planning and RegionalDevelopment on: the draft FY 2014 Public Investment Budget;

The Minister for Finance began by assessing the first months of

implementation of the new programme budgeting format, effective on 1 January2013. He stressed that implementation of the State budget significantly improved

over the months, especially in terms of capital expenditure. This was thanks tostakeholder ownership of the new integrated budget management system and new

public procurement procedure instituted. He revealed that the budgetary item:fuel

price subsidy, will attain CFAF 420 billion at the end of the fiscal year, or 4% of

Gross Domestic Product (GDP).

The Minister went on to indicate that budgetary prospects for FY 2014 arestill blighted by the same risks that led to the economic recession experienced

worldwide since 2008. Thus, notwithstanding growth projections estimated in

2014 at around 5.9% in the CEMAC area and 4.8% nationally, the assumptions of

the 2014 budgetary framework remain cautious.

The strategic objectives of the State financial policy continue to be centred

on the promotion of robust, sustainable growth likely to create jobs and the

improvement of productivity and the business climate.

The Minister for Finance indicated that like in previous years the budget

will be financed by traditional sources such as oil and non-oil resources, resourcesfrom international cooperation and tried-and-tested innovative mechanisms like

bond issues. With the entry into force of the law on investment incentives whose

beneficial effects on the economy will be perceptible in the medium and long

terms, tax depreciation will set in as from 2014.

Lastly, he renewed his appeal for greater fiscal discipline in all Government

departments through the mastery of staff expenses, an improvement in the quality

of routine recurrent expenditure, a stringent management of the State equity-

participation and subsidies portfolio, the close monitoring of tax expenditure and

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sustained support and accompaniment of local/city councils benefiting from thetransfer of powers and resources.

Next, the floor was given to the Minister for the Economy, Planning and

Regional Development for complementary details on the investment component

of the 2014 Public Investment Budget. He said the lackluster performance of

capital expenditure in early 2013 was attributable to the insufficient maturation ofprojects and poor ownership of budgetary and procurement reforms. However,the remedial measures implemented since have helped to largely catch up with

delays observed in the start-up and implementation of projects financed by the

public investment budget.

With regard to the stakes of the public investment policy in 2014, he said

the target will be to consolidate growth, support decentralization as well as the

financing of major projects. This will require a two-fold increase in the general

decentralization allotment, devoted to investments, to support the implementationof council development plans (being generalized) and contract-plans with

municipalities.

The profile of the public investment budget in 2014 will cross the much-

desired mark of 30% of the overall State budget. The envisaged allocation will

primarily target energy and road infrastructure, water and sanitation and the

formation of land reserves for agro-pastoral and residential use. A significantpercentage of resources will also be earmarked for the development of sub-sectors

with high potentials and modernization of the production machinery.

After these statements, and pending final arbitration by the President of the

Republic on the 2014 draft budget, the Head of Government gave guidelines

relating to Governments passage before Parliament during the session devoted to

the debate and passing of the finance bill. He also prescribed measures such as the

effective maturation of projects before their insertion in the budget and better

programming of public contracts since this will help to surmount the recurrent

impediments to the sound implementation of the public investment budget.

The Cabinet Meeting was adjourned at 2:15 p.m. after consideration of

sundry issues linked to Government work./-

Yaounde,

GHOGOMU Paul MINGO,

Director of the Prime Ministers Cabinet