• CEMAC borrowing costs jump to 11.5% in late 2025
• Higher fees, policy tightening drive rise despite stable nominal rates
• Credit grows, but governments crowd out private sector lending

Borrowing costs in the Economic and Monetary Community of Central Africa (CEMAC) rose sharply at the end of 2025.

According to the Bank of Central African States (BEAC), the average effective lending rate climbed to 11.5% in the fourth quarter from 9.71% in the third, following the Monetary Policy Committee (MPC) meeting on April 2.

The increase reflects tighter financing conditions across the region. At its last meeting of 2025 on Dec. 15, BEAC raised its two main policy rates by 25 basis points, making central bank refinancing more expensive for commercial banks. The aim was to push up lending rates, curb access to credit, and support foreign exchange reserves.

In practice, the rise in borrowing costs was driven mainly by higher banking fees and commissions. The nominal rate remained broadly stable, edging up from 7.09% to 7.15%. However, the gap between the nominal rate and the total cost of credit widened to 4.24%, from 3% previously.

BEAC also pointed to strong government financing needs, which are limiting banks’ capacity to lend to the private sector. At the same time, banks are shifting toward short-term lending, which grew by 10.7%, at the expense of longer-term financing.

All borrower categories were affected. Rates for large companies reached 10.24%, while small and medium-sized enterprises faced 13.15%. Individuals paid the highest rates at 16.71%, while government entities borrowed at an average of 11.24%.

Gabon posted the highest lending rate in the region at 22.28%, followed by Equatorial Guinea and the Republic of the Congo. Chad, the Central African Republic and Cameroon recorded rates below the regional average.

Rates rise despite easing inflation

The tightening in credit conditions comes despite improved price stability. Inflation in CEMAC fell to an average of 2.1% in 2025 from 4.1% in 2024, dropping below the regional target of 3%.

The decline was driven mainly by lower global food and energy prices, as well as reduced maritime transport costs. Domestically, measures to ease the cost of living, fuel price stabilisation in some countries, and the fading impact of earlier increases also contributed.

BEAC forecasts inflation at around 2.3% in 2026. However, amid global uncertainty, the central bank has opted to keep policy rates unchanged.

Despite higher borrowing costs, credit to the economy grew by 10.7% in 2025 to 13,742.8 billion CFA francs ($24.4 billion), supported by agro-industry, trade, services and construction.

Sandrine Gaingne