CAMEROON: Strengthening the Douala Port credit worthiness

The Public-Private Infrastructure Advisory Facility (PPIAF) awarded a $273,500 grant to the government of Cameroon to enhance the financial viability of the Port Authority of Douala (PAD), enabling it to access non-sovereign lending from development partners and commercial financiers. PPIAF supported the government of Cameroon in the development of a comprehensive Financial Recovery Plan, including an investment plan to improve the port's financial sustainability. The plan also provided a shadow credit rating and debt sustainability strategy, along with training for PAD's finance department staff to support long-term financial health.

Other key deliverables of the PPIAF's grant included a report on the port's corporate governance structure, clarifying its legal capacity to borrow in capital markets and highlighting international best practices for port financing. The assessment identified six key factors for financial improvement to facilitate access to non-sovereign lending:

• Sustainable growth in ship and cargo traffic;
• Stability and growth in operating cash flow (including cost-reflective pricing, control of operating costs, improved collection rates);
• A realistic and efficient investment plan;
• Rationalization of debt and clarification and stabilization of the financial relationship with the state;
• A long-term financing strategy.

Following this comprehensive support, PAD was able to secure the largest loan in its history in November 2022, amounting to CFAF 100 billion (€163 million) from nine local banks, with a 12-year maturity. This is the largest loan in its history on the local money market. Additionally, PAD achieved long-term A and short-term A2 credit ratings from Bloomfield Investment Corporation, marking a significant improvement in its financial profile. The financial turnaround was further supported by PAD's creation of the Régie du Patrimoine Immobilier to enhance its assets and the takeover of activities previously managed by concessionaires and service providers, such as container terminal operations, towing, dredging, and port safety.

From June 2022 to June 2023, PAD's turnover increased by 5% to CFAF 41 billion, driven by an 8% increase in traffic, tariff revisions, and controlled operating costs. The successful debt restructuring in 2022 and improvements in data reliability and account settlement also contributed to PAD's positive financial results. In a continued effort to boost private investment, on May 30, 2024, the Director General of the Douala Autonomous Port and the President of CARPA signed a three-year cooperation agreement. CARPA will assist in attracting private partners for port infrastructure projects, enhancing the port's financial stability and creditworthiness.