The Financial Challenges of Cameroon’s Water Utility: A 2022 Overview
In 2022, Cameroon’s national water utility, Camwater, faced significant financial challenges, with reported losses amounting to 9.4 billion CFA francs. This situation highlights the broader issues within the utility sector and the impact of unpaid bills on the financial health of public utilities.
Camwater’s financial difficulties are not isolated incidents but part of a recurring problem of debt accumulation within the sector. The utility company claimed unpaid bills totalling 10.3 billion CFA francs from the government, covering arrears from the beginning of 2018 through the end of June 2022. These unpaid bills have a cascading effect on the utility’s ability to maintain operations, invest in infrastructure, and provide reliable services to the public.
The issue of unpaid bills is compounded by the financial obligations Camwater has towards its employees and former employees of the defunct Société Nationale des Eaux du Cameroun (SNEC). To address some of these obligations, the company’s director general announced the disbursement of 500 million CFA francs to the unions, representing a partial payment of the 10 billion CFA francs owed as social debt.
Despite these financial hurdles, Camwater has continued to pursue its mission of improving water supply across the nation. The company has been working on a project to design, rehabilitate, and build drinking water supply systems in 20 towns in Cameroon. This initiative is crucial for enhancing the quality of life for many Cameroonians and is a step towards achieving sustainable water management in the country.
The financial woes of Camwater serve as a reminder of the intricate relationship between public utilities, government policies, and the need for sustainable financial models. As Cameroon continues to develop, the resolution of such financial challenges will be paramount in ensuring that essential services like water supply can be delivered efficiently and reliably to all citizens.
Cameroon Water Utilities (Camwater), the company in charge of the distribution of drinking water, ended the year 2022 with a negative net result of 9.4 billion CFA francs. Year-on-year, this loss decreased by 1.7 billion CFA francs, compared to -11.1 billion CFA francs recorded in 2021.
The information was made public on July 30, 2024, in the final press release of the 51st ordinary session relating to the closing of accounts for the financial year ending December 31, 2022. This is the second consecutive year that Camwater has recorded losses after positive net results of 1.8 billion CFA francs in 2019 and 1.3 billion CFA francs recorded in 2020.
If we refer to the latest CTR report on the situation of Public Enterprises and Public Establishments in Cameroon, this increase could be justified by the densification of its water distribution network on the one hand and the other hand by the increase in its distribution yield to 50% against 48% during the year under review. Indeed, the company announced in 2022 its five-year priority investment program amounting to nearly 1000 billion CFA francs and devoted to the completion and closure of projects currently being implemented, as well as the maturation of future projects.
It should be noted that that year, Camwater lost more than half of the water it held in the distribution network due to leaks, the dilapidated state of its distribution network and various frauds. The resulting impact is a loss of 26 billion CFA francs per financial year. In 2021, the CTR also attributed the losses recorded by Camwater to the deterioration in operating income linked to the weight of operating expenses.
