Cameroon’s economic outlook faces headwinds as hilli episeyo prepares to depart

The countdown has officially begun for Cameroon’s economy. The Hilli Episeyo, a crucial floating liquefaction unit that has been anchored off Kribi since 2018, is set to leave national waters in July 2026. This departure marks the expiration of the contract between its owner, Golar, and the national hydrocarbons company, Société Nationale des Hydrocarbures (SNH). In its economic review for the first quarter of 2026, the National Economic and Financial Committee (CNEF) identifies this impending exit as a central factor contributing to an anticipated economic slowdown, alongside ongoing geopolitical tensions and the underperformance of several key export sectors.

Detailed projections from the CNEF indicate that Cameroon’s gross domestic product (GDP) is expected to grow by approximately 3.2% in 2026, a decrease from 3.5% recorded the previous year, further slowing to 3.1% in 2027. An alternative, slightly more optimistic scenario within the same document forecasts growth at 3.3% followed by 3.2%. Under both assumptions, the underlying rationale remains consistent: the extractive sector is poised to drag down overall growth, contributing a negative 0.4 percentage points in both forecast years. Specifically, the petroleum GDP, which encompasses all hydrocarbon-related activities, is projected to plummet by 16.1% in 2026 and an additional 18% in 2027.

lng sector already declining before the vessel’s departure

The scheduled departure of the Hilli Episeyo comes at a time when the liquefied natural gas (LNG) market is already showing signs of weakness. Revenues generated from LNG exports reached 350.2 billion FCFA in 2025, a significant drop from 381 billion in 2024, 421 billion in 2023, and a peak of 622 billion in 2022. This represents an 8.1% year-on-year decline. This downward trend continued into the beginning of the year; during the first quarter of 2026, Cameroon’s total exports fell by 23.6% to 606.9 billion FCFA, with LNG exports alone decreasing by 28.4%, and crude oil exports by 14.4%.

Despite the decline, LNG still accounted for 11.4% of Cameroon’s export revenues in 2025. Therefore, the withdrawal of this floating factory vessel deprives Yaoundé of a critical asset precisely when other key sectors are also losing momentum. Over the same period, sales of cocoa and its derivatives plunged by 37.7%, timber sales by 11.5%, aluminum by 53.7%, and crude rubber by 16.7%. This cumulative decline across various sectors intensifies the potential impact of the looming gas shock.

current account under pressure, delicate budgetary decisions ahead

Cameroon’s macroeconomic stability is expected to absorb a significant blow. The CNEF projects a current account deficit of 5.4% of GDP in 2026, worsening to 6.1% in 2027, compared to an estimated 3.2% in 2025. The budget deficit is anticipated to follow a similar trajectory, reaching 1.7% and then 2.1% of GDP. These forecasts also factor in a global trade slowdown, rising freight costs, and only moderate growth in public revenues.

Furthermore, rising global oil prices present a classic dilemma for the government. Maintaining stable fuel prices at the pump would necessitate increasing fuel subsidies, incurring an immediate budgetary cost. Conversely, adjusting retail fuel prices upwards would likely fuel inflation and erode household purchasing power. The CNEF refrains from making a definitive recommendation but underscores the extremely narrow margin for maneuvering available to policymakers.

yoyo-yolanda and new blocks: no immediate relief in sight

SNH is actively pursuing a strategy to diversify its upstream portfolio to prepare for the post-Hilli Episeyo era. A major milestone in this strategy is the transnational Yoyo-Yolanda field, shared with Equatorial Guinea. Its geological resources are estimated at approximately 2,500 billion cubic feet, with an investment requirement nearing 4 billion dollars. However, the project’s timeline remains contingent on finalizing technical and commercial agreements, securing necessary financing, and constructing dedicated infrastructure.

In parallel, the state-owned company is continuing to award new exploration blocks in the Rio del Rey and Douala-Kribi-Campo basins. Yet, entering into production-sharing contract negotiations does not guarantee the discovery of commercially viable reserves nor rapid production commencement. The primary risk, therefore, lies in the duration of this transition period: the longer the interval between the floating vessel’s departure and the activation of new production capacities, the more entrenched the negative contribution of the extractive sector will become to Cameroon’s overall economic growth. Reports suggest that none of the currently announced initiatives are capable of immediately offsetting the projected decline in LNG exports.