The recent renationalization of Eneo in Cameroon has drawn sharp scrutiny from the International Monetary Fund (IMF). In its latest assessments published in May 2026, the institution warns Cameroonian authorities about the potential financial burden of the takeover, which saw the state reclaim nearly all of the capital previously held by British fund Actis. Renamed Société camerounaise d’électricité (Socadel), the company is now 95% publicly owned, with the remaining 5% distributed among employees. The IMF expresses concern that this move could further strain an already tight national budget.
Shifting liabilities onto a constrained budget
The IMF’s evaluation leaves no room for doubt: absorbing the country’s historic electricity distributor transfers onto the state’s balance sheet a series of structural liabilities that private operators had long managed. The report highlights persistent issues such as unbalanced tariffs, mounting arrears with public administrations, and accumulated debts to independent producers—now all transferred to the national treasury. This shift occurs at a time when Cameroon’s fiscal space remains severely limited.
Under a program supported by the Extended Credit Facility and the Extended Fund Facility, the government is tasked with restoring public finances, servicing external debt, and funding essential social programs. The sudden absorption of Eneo’s financial obligations adds an additional layer of complexity to this delicate balancing act. The IMF underscores the urgent need to prevent Socadel from becoming a source of uncontrolled recurring expenses.
A structurally unbalanced business model
The IMF’s concerns extend beyond ownership structure to the very viability of the newly nationalized operator. The Fund describes Socadel’s economic model as fundamentally unbalanced, noting that current user tariffs fail to cover production and distribution costs. Technical and commercial losses on the network continue to erode profitability, while state compensation—when provided—often takes the form of unfunded subsidies or deferred payments that eventually return to the budget. This creates a cycle of financial strain.
The new ownership split—95% state-owned, 5% employee-shareholders—reflects this precarious setup. While the arrangement aims to include staff in governance, it does little to address the core challenge: ensuring the distributor’s financial sustainability. The IMF points out that Actis’s exit, finalized months ago, was not accompanied by a comprehensive overhaul of tariff policies or a sufficiently detailed operational recovery plan to reassure lenders.
Securing the electricity sector without worsening deficits
Despite these concerns, Cameroon’s electricity sector remains a cornerstone of national development. It underpins industrial competitiveness, supports the phased commissioning of major hydroelectric projects like Nachtigal and Memve’ele, and aligns with the country’s broader goal of universal energy access outlined in the 2020–2030 National Development Strategy. Any failure by Socadel to deliver reliable service could disrupt the entire value chain, from producers to end consumers, including the national transporter Sonatrel.
For the IMF, the immediate priorities are clear: define a precise mandate for Socadel, establish a credible tariff adjustment trajectory, and resolve the tangled web of debts between the state, independent producers, and the distributor. Without these measures, the risk of recurring public guarantees to cover deficits remains high. Technical missions from the IMF are expected to scrutinize the company’s governance and operational recovery conditions over the coming months.
The renationalization also raises broader questions about investor confidence. The withdrawal of a major private utility operator from an African energy market, followed by full state takeovers, challenges the predictability of public-private partnership frameworks in the sector. Cameroonian authorities will need to demonstrate that Socadel is not a defensive maneuver but the foundation of a wider reform in energy governance. The IMF’s diagnostic, unveiled in mid-2026, is designed to influence key policy decisions moving forward.
