Cameroon is in discussions with the French Development Agency (AFD) over a proposed €40 million sovereign loan aimed at supporting the country’s cotton producer, SODECOTON.
According to a report published on September 29, the proposal is being examined at the request of Cameroon’s Ministry of Economy. The financing could also help preserve a €10 million grant from the European Union linked to SODECOTON.
SODECOTON plays an important role in Cameroon’s northern agricultural economy, particularly through cotton production and the livelihoods connected to the sector.
The reported financing discussions come after previous difficulties surrounding funding for the company. Earlier this year, the cancellation of an AFD loan had raised concerns over the company’s financial position and the related EU support.
The new proposal could therefore provide another avenue for financing the cotton sector, although the reported discussions do not yet amount to a finalized loan agreement.