The government of Cameroon has closed a €94.8mn export credit agency-backed deal to finance the improvement of a road in the south of the country.

Deutsche Bank is the sole lender on the transaction, issuing a loan guaranteed by Italian export credit agency Sace, according to a statement from Bluebird Finance & Projects, a financial advisor to the contractors.

The project includes the “rehabilitation, modernisation and expansion” of the 70-kilometre stretch of mainly dirt road which forms part of a route linking the Cameroonian capital Yaounde with neighbouring Gabon, according to the statement.

A entry on Sace’s website says works include the construction of 13 reinforced concrete bridges, taking place in the department of Dja-et-Lobo. A second phase, refurbishing a further 50km up to the Gabonese border, is expected to be executed “in the near future”.

Two “small” Italian companies, SEAS Srl and Cosedil Spa, have formed a joint venture to implement the project, with other Italian suppliers also contributing. SEAS has been working on the development with the Cameroonian government for almost eight years, Bluebird says.

Italian development finance institution Simest is providing a “stabilisation” of the interest rate payable by the borrower, Cameroon’s economy ministry.

Sace did not respond when asked by GTR to disclose the tenor and interest rate applicable to the deal.

SEAS says the transaction “represents a significant entrepreneurial success for the entire Italian SME sector”.

Bluebird’s chief executive Ram Shalita says the leading roles played by the Italian firms “is a great example of how two SMEs, determined to make a change, succeed at arriving at the finish line in such a complicated and long journey, and showing that the way is open also for smaller players, and not only for the giant EPCs [engineering, procurement and construction contractors]”.

Shalita adds that the transaction “is the essence of export finance – a project which will improve the lives of millions, and which will fix a huge unreasonable gap – a critical national route which has been so far, for many years, a dirt road”.

Export credit agency-backed deals are less common in Cameroon than in other West African states such as Ghana and Côte d’Ivoire, although in 2022 UK Export Finance guaranteed a loan for a road redevelopment issued by Standard Chartered, and earlier this year US Exim signed a deal financing the export of industrial equipment to the country.