Question 1: Of all the countries of the Sub-Saharan African, Cameroon, endowed with human and natural resources, could have the ambition to become in a medium run, an economic leader of the sub-region. According to you, what are the main advantages Cameroon has to be able to play this role? Would you please describe government’s policy in terms of priorities and ambitions to give the country a higher profile?
Answer 1: The major assets of our country are peace, stability and security. These three parameters guide us in everything we do; even in our relations with neighbouring countries, stability and security are our key words.
With the three assets, we will be able to attract investors who would never come if they are not guaranteed. In addition, Cameroon has a young democracy that is doing quite well in spite of its age: it is a politically open country with seven parties represented in the National Assembly. If you attended one of its sessions, you will be able to gauge the level of freedom during the debates. The freedoms of expression and association are a reality in Cameroon and also stand as an asset. Also, school attendance here is quite high. Our 60% literacy rate is among the highest in sub-Saharan Africa. This means that Cameroonians are well educated, dynamic and hard-working. Additionally, we have two languages (English and French) that can be used throughout the world to do business. Besides these benchmarks related to political stability, Cameroon has several potentials which enable it to play a leading role at the sub-regional level.
While sharing a common external tariff with the other countries of the CEMAC (Central African Economic and Monetary Community) zone, Cameroon is, indeed distinct through its degree of openness marked by an ambitious economic liberalisation policy.
Cameroon stands out as one of the richest countries of the CEMAC zone : accounting for over half of its total population, about 45% of its GDP, over 60% of its production plants and close to a third of its external trade. Its geographical location makes Cameroon the main gateway into the countries of the sub-region.
With regard to economic liberalisation, the authorities have overhauled the country’s trade policy, and further liberalised the discharge of economic activities. This was concretised through the abolition of non-tariff barriers particularly the elimination of import quotas, the suppression of import and export licences and approvals, and the scrapping of price harmonisation and administrative control of profit margins. In addition, the distortions stemming from the preferential tax schemes have been suppressed and most of the beneficiary firms are now governed by the ordinary law system.
On the whole, the liberalisation reforms have helped to ease economic management, to curtail the powers of various Government services through the scrapping of various preliminary authorisations and to cut transaction costs.
In addition to its quality human resources, the country is endowed with plentiful natural resources. These include a huge hydroelectric potential (production capacity of 3000 MW), favorable climatic conditions and fertile soils, considerable water reserves (9598km2 of submerged land and 465402 km2 of dry land), enormous forestry resources and a wide range of untapped mineral resources, including chromium, uranium, iron ore, natural gas, bauxite, gold and nickel.
These considerable potentials should attract business to Cameroon. Our modern economy is ever being improved and made more efficient. Indeed, we have tried to follow international standards by carrying out many economic programs with the IMF to the satisfaction of the international community. We have successfully completed a three year program with the IMF. We were also very happy about it; so much that we have started another program, known as “second generation reforms”. The Cameroonian government’s macro-economic objectives for the coming three years are to: increase real GDP growth rate from an average of 5 percent per annum in recent years to 6 percent by 2002/03, thus allowing for an increase in per capita GDP of about 2-3 percent; contain consumer price inflation at 2 percent; and limit the external current account deficit (excluding official transfers) at about 3-3.5 percent of GDP. With these programs, we hope to at least address a number of issues including poverty alleviation, better expenditure management and the improvement of most of the economy.
We think that internal peace, stability and the courage to undertake economic reforms, are good indicators for potential investors.
Q. 2: One of the economic reforms undertaken by your government is privatisation of the major state-owned companies. How far has your administration gone with the privatisation process and what are your expectations regarding this process that will soon come to an end?
A 2: On this aspect of the economic reforms, I would say we have gone at our own pace: slowly and steadily and we have obtained reasonable results. For instance, our privatisation of the telecommunication sector, has yielded very impressive results because access to telephone has improved considerably in our country. We have also privatised the banking and transports sectors as well as our railway and shipping companies. The American company AES SIROCCO Limited has been selected as the interim bidder of the State-owned electricity company, SONEL. In the agro-industrial sector which, as you know, is a very big sector because it employs a lot of workers, it was quite sensitive to privatise some companies which were corporations or holdings. We are actually proceeding with the privatisation of the Cameroon Development Corporation, CDC, and eventually with SODECOTON. We have privatised the sugar company CAMSUCO as well as our leading company in the oil-palm industries, SOCAPALM and the rubber company HEVECAM.
Furthermore, regulatory agencies have been set up in the telecommunications and electricity sectors to ensure a smooth functioning of these sectors and the development of fair competition amongst the various operators.
So, we are quite happy with the privatisation operation. It is a delicate operation that we have done with a lot of courage. The satisfactory results have been obtained in all transparency: that is a key element. Our partners, the World Bank and the IMF are satisfied with what we have done. The international community should know this.
| Q. 3: American investors recently heard that the realisation of the pipeline project from Chad to Cameroon was on the right track; pipeline construction that is one of the biggest projects ever realised on the African continent. Regarding both phases of pipeline construction and exploitation: how do you evaluate the economic gains for the country in terms of incomes and employment?
A. 3: As you know, the pipeline will enable the transportation of oil from oil fields in Chad. Cameroon will only provide access to that oil. This pipeline will be 1070 kilometres long with 80% of that in Cameroon. We hope to reap some benefits from transit fees. After five years of exploitation, Cameroon should receive around 10 million USD a year. But the major benefits from the project are incomes generated by employment. What we consider important is creating jobs for Cameroonians even if I do not know how many jobs will be created. Besides, some operations will be subcontracted to Cameroonian companies, particularly in constructions, supplies and other operations.
It is right to say that the project took many years before being realised. Why? The private sector needed to be convinced that the time was right for it to invest in the pipeline. Now, this is the time to move in, the conditions are right. And they looked at what I said earlier: stability and peace in the sub-region and particularly where the infrastructure would be located and finally chose to realise the project. The background of the project has also to be mentioned. The governments of Chad and Cameroon, thanks to their Presidents, did a lot of work to convince the international community, to assure investors that they should come into Cameroon. We also have a lot of work to do with environment, to assure the world’s conservationists even the World Bank and that the project is going to be carried out in accordance with the high standards of environment protection.
The presence of major investors here is an opportunity for the sub-region. It will stimulate our economy. As you mentioned, that is the single biggest private sector investment in the sub-region. And we attach a lot of importance to it. We consider the pipeline as a development project, because it is going to improve major social infrastructure in the areas of education, (schools) health (health-centres) and roads. It will thus have an impact on development. We also think that the communities and the villages along the pipeline route will reap socio-economic benefits generated by the project.
Q. 4: Speaking about liberalization of trade during the France-Africa Summit held in Yaoundé a few weeks ago, President Biya was not that optimistic. Keeping in mind that Cameroon has been recently elected to the debt relief plan as a heavily indebted country, how do you see your country entering the era of globalisation?
Answer 4: Firstly, there is not much we can do. Regarding the challenges of globalisation, we have to get there and try to see how much we can be part of it. Within the advantages from liberalized trade, some pressure has been put on companies to perform better. But what we need in fact is a period of transition for us to become a bit more competitive, in order to compete with the rest of the world. Otherwise, we will not have freedom in competition.
Of course, it is an absolute necessity to consider liberalization with regards to the debt relief. I think the international community is satisfied and is now listening, becoming more understanding and responsive. Of course, it requires that we perform, and we are performing. They want to see that we are serious in our management, that we carry on structural reforms that will bring efficiency and so on. That is what we have been doing. And because of the success of the first program we have just finished in June 2000, we got to the decision point and as you know we benefitted from debt relief. We recently successfully negotiated with the Paris Club the rescheduling of our debt. We hope that when we reach completion point, the debt stock will be reduced. We appreciate the importance of debt relief and obviously the understanding of the international community and bilateral and multilateral partners towards effective debt relief.
Q. 5: With all the sectors that are being restructured and considering the economic growth, how would you describe the business climate here and investment opportunities for foreigners that would come to invest in Cameroon?
A. 5: First of all, I would like you to be the medium through which this country’s image will be projected the world over. Cameroonians generally do not blow their own trumpet. We have in Cameroon many things that other African countries do not have. I have talked about the successful implementation of our economic program with the IMF. Now, some people say all the African countries have done it. But by size, we have a bigger economy that is among the first five economies of sub-Saharan Africa. It means that in structural adjustment, efforts would be more difficult and complicated. Here is a country also which culturally is English and French, which has a diversity of religions and we do everything to hold it together. That is an achievement.
When you consider the current business environment in this country, you will realise that we have cleaned up this environment and tried to make it attractive. The dialogue that exists between the private sector and the public sector, the committees we have created even headed by people from the private sector have improved the economy. We even have a human rights commission that is free to move around the whole country, to investigate, to write reports that are published. Government has also prepared a good governance program to improve governance in the country, and has set up a committee to fight corruption. We do not agree that Cameroon is the most corrupt country. We are talking so much about corruption that the international community thinks that Cameroon is the most corrupt country in the whole world. The only reason is that we are speaking a lot about corruption. There is so much freedom of expression here. Anyway, I do not want to encourage other countries to think Cameroon is corrupt but to encourage them to know what happens here to solve this problem. Then, we have an anti-corruption committee that is an observatory to monitor corruption in our society. We think that the world should know that it is a forward-looking, strong, reform-oriented country, and that this is a place to be, where to invest and to do business.
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