Equatorial Guinea’s political capital, Malabo, has experienced conflicting macroeconomic performance in the first three months of 2014, according to a meeting held by the Monetary Policy Committee (MPC) of the BEAC.

During this period the sub region achieved a growth of 6.1 per cent of its gross domestic product, with almost 7.1 per cent for the non-oil sector.

At the same time, inflation has been difficult to control in sub-regional convergence rate, positioning around three per cent.

At the same time BEAC noted that the budget balance (commitment basis) has recovered but remains negative at -0.3 per cent of GDP.

The bad news is intervened on the side of the current account balance which deteriorated further to -8.1 per cent of GDP, indicating that in the sub-region imports exceeded exports.

According to data collected by the IMF in its statutory consultations last May-June, it appears that the fiscal and external balances are even more pronounced off oil revenues and could reach -26.28 per cent of GDP by CEMAC the end of 2014.

Faced with this flood of conflicting data, the MPC decided to cut 30 basis points, the interest rate of supply calls, in line with what had been started at the end of the second half of 2013, a measure which should solve a number of problems.

Already it will boost the sub-regional growth, again supporting the economic recovery in Central African Republic. The country out of its difficult socio-political crisis is one that will fully benefit from the new lower rates.

Despite the political risk posed by RCA, it is expected that banks borrowing cheaper, try to take advantage of attractive rates on the credit market and will be more inclined to take risks in financing the economy further.

Also lower rates, in theory, should positively impact the external balance.

Pegged to the euro a stable parity, CFA, in principle, tends to produce the same effects in the face of monetary policy decisions.

Thus, lower bidding rates should act as a technical devaluation of the CFA face including the dollar, which is expected to see increased value of imports and therefore improve the external sub-regional balance.

Recall that a lower CFA is a plus point, especially for a region that depends on oil revenues sold in dollars.

However, we must remember with the IMF, the lever of monetary policy cannot work by itself.

Experts have indicated: "In coordination with regional institutions, member countries should better prepare for a possible temporary decline in oil prices by establishing budgetary savings that would continue their development.

“More generally, they should focus on better management of oil resources. They should also be cautious with regard to the accumulation of public debt in order to minimize the risk of over-indebtedness in the medium and long term.”

Note also that if the banks are more involved in the economy it does not necessarily mean a big change for people and SMEs, which will always have difficulty accessing credit because of a recurring factor, the deficit an environment guaranteeing banks can limit the propensity of bad debts.