Cameroon faces fiscal pressure from fuel subsidies and declining oil output

The International Monetary Fund (IMF) has warned that Cameroon faces mounting fiscal pressure and weakening economic prospects for 2026. While the economy grew by 3.5% in 2025, growth is expected to lose momentum due to declining hydrocarbon production and constraints in electricity-transmission capacity.

A primary concern is the widening fiscal deficit, which rose from 1.5% of GDP in 2024 to 2.1% in 2025. The IMF noted that rising international petroleum prices are increasing the cost of fuel subsidies, which currently benefit high-consuming households more than the poorest citizens. IMF mission lead Christine Dieterich recommended reforming these subsidies to better target vulnerable populations while preserving funds for priority infrastructure in transport and electricity.

Additionally, the IMF highlighted risks regarding food inflation, which could reverse recent downward trends and weaken household purchasing power. Infrastructure delays, particularly in transmitting available electricity to businesses and households, are also cited as factors that increase operating costs and restrict industrial production.