 MAIN ECONOMIC INDICATORS
 1999-2000
Gross National Product (GNP): 5701 billion CFA francs
Inflation: 2.1%
Growth Rate: 4.2%
Exports: 1092.1 billions CFA francs
Imports : 905.9 billions CFA francs
Balance of payment: 186.2 billion CFA francs
1998-1999
Agriculture and forest products represented 42% of the Gross National Product
Mines and industry represented 22% of the Gross National Product
Active population: 41%
INVESTMENT IN CAMEROON
In establishing a business enterprise in Cameroon, a foreign investor may freely choose from a wide selection of business forms inherited from the French and the British. The most commonly used are the public limited liability company and the private limited liability company inherited from the British and similar business forms inherited from the French, namely, « Société Anonyme », and « Société à Responsabilité Limitée ». Other forms include sole proprietorships (établissements), partnerships and branch operations.
A private limited liability company may not offer its shares to the public and should have two or more shareholders but not more than fifty. This company should have seven or more members.
A Société Anonyme can have one or more members and can be administered by a board of directors of at least three members; it doesn’t need to have a board of directors; a managing director that performs the functions of a board of directors and who directly reports directly to the shareholders can be appointed.
The company must have a minimum capital of ten million CFA francs divided into shares with a nominal value of at least ten thousand CFA francs per share.
A private limited liability company (SARL) must have a minimum capital of one million CFA francs divided into equal parts with a nominal value of at least five thousand CFA francs.
Expatriates may ask for authorization to bring back up to part of their earnings on a regular basis. Employees may bring back up 20% of their net salary if they are single or are based in Cameroon with their family. If their family and dependent live outside the CFA zone, permission may be obtained to repatriate up to 50% of net earnings. Any saving made in Cameroon may be repatriated when leaving the country.
INVESTMENT INCENTIVES
The Investment Code is intended to encourage and stimulate productive investment in Cameroon. It provides certain general guarantees, such as non-discrimination between enterprises owned by nationals and those owned by foreigners and no expropriation or nationalisation without just and equitable prior compensation as determined by an independent third party.
The Investment Code also allows specific benefits, according to the regime under which an enterprise is categorized. There are five regimes: the basic regime, the small and medium-size enterprises regime, the strategic enterprises regime, the industrial free zone regime and the reinvestment regime.
The most important investment incentives are tax based. Of these, the most significant are import duty concessions, exemption from export duties, tax reduction and tax holidays.
Other tax incentives include the carry forward of depreciation and losses as well as the exclusion of reinvested capital gains from taxable income for a period of three years. Local industries fulfilling certain conditions are protected to enable them to obtain a footing in the domestic market.
THE STRUCTURAL ADJUSTMENT PROGRAMME (SAP)
Of all the countries in sub-Saharan Africa, Cameroon was the last to be hit by the economic crisis in the early ‘80’s. There was a sharp fall of the GNP: more than 20% between 1988 and 1992. The government took stringent structural adjustment measures and sought aid from the International Monetary Fund (IMF) in 1988.
The first stand-by accord was signed in September 1988 for a period of 18 months. Without concrete results, the agreement was extended to June 1990. Cameroon was relieved when the Club of Paris rescheduled its foreign debts in 1989.
The IMF signed a second stand-by accord in December 1991. Two months after the CFA devaluation, the board of administrators of the IMF met and approved the third stand-by accord in March 1994. The agreement was put on hold. Finally an agreement was signed in September 1995 granting Cameroon 52.6 billion CFA Francs. Its objectives were to reduce inflation to about 8%, increase GDP to 5%, and reduce budget deficit to 1.5%.
On August 1997, thanks to positive economic indicators, a three year programme totalising 97.07 billion FCFA was signed with international financial institutions. The programme had three objectives: to reduce poverty, re-establish internal and external balance and to put the economy back on track. State finances started increasing, economic growth rate rose to 4.5%, inflation was brought down to 2%. Revenues from petroleum exports were better managed and contributed significantly to the national budget 1999-2000. A national observatory was created to fight corruption. New procedures were put in place for the award of public contracts.
The privatisation of certain parastatals took-off effectively: HEVECAM, REGIFERCAM (now CAMRAIL), SOCAPALM, etc. Negotiations are currently underway for the privatisation of the Cameroon Development Corporation (CDC), the National Electricity Corporation (SONEL), and the National Water Corporation (SNEC). Cameroon Telecommunication (CAMTEL) is already privatised. With privatisation, the private sector is gradually becoming the driving force of the country’s economic growth. Other reforms have been made in the forestry, transport, banking and customs sectors.
The European Union is the major trading partner of Cameroon. Economic exchanges with countries in the CEMAC sub-region remain low. South East Asian countries are the second most important commercial partners of Cameroon.
Exports to these countries skyrocketed from 52 billion CFA francs in 1998-1999 to more than 191 billion CFA francs in 1999-2000. Concerning bilateral trade, Taiwan has positioned itself as Cameroon’s third commercial partner after Italy and France.
AGRICULTURE
Agriculture remains the linchpin of the Cameroonian economy, and involves about 70% of the active population. It accounted for as much as 80% (FCFA 1075 billion) of the primary sector’s contribution to GDP in 1998-1999, which stood a FCFA 1875 billion, as compared to FCFA 1478 billion from the secondary and FCFA 2269 billion from the tertiary sectors. It also provides 1/3 of foreign exchange earnings, 15% of budgetary resources.
Richly endowed with agricultural products, Cameroon has ideal conditions to ensure its food security and thus achieve more effective agricultural exports.
Production is diversified between cash (export) and food crops, much of which cultivation is still peasant, yet of such productivity as to make Cameroon Central Africa’s bread basket. Food crop production recorded some 6,2 million tonnes in 1998-1999 (1,7 tonnes of plantains, 2 million tonnes Cassava tubers, 820 000 tonnes of Coco yam tubers, 820 000 tonnes of maize and 385 000 tonnes of millet).
As for export crops, Cameroon ranks 6th in world Cocoa (127 000 tonnes), and 8th in Coffee (85 000 tonnes) production. Agro-industrial production essentially focuses on these and other export crops like Banana (197 800 tonnes), (193 000 tonnes), palm oil (98 000 tonnes), sugar (85 000 tonnes), rubber (57 000 tonnes) and Tea (4 200 tonnes). While hard market weather has forced a decline in coffee and cotton production, an upturn was lately being experienced in palm oil, banana and rubber production.
A few figures.
Robusta coffee (about 100,000 t).
Arabica coffee (more than 20,000 t)
Cocoa (more than 120,000T, with more than 100,000 t for export)
Rubber (more than 60,000T, with more than 35,000 t for export)
Cotton (about 140,000 t with more than 60,000t for export)
Palm oil (more than 130,000 t with more than 100,000 t for export)
Export banana (more than 125,000 t)
Refined sugar (about 70,000 t)
Tea (about 4,400 t)
Corn (more than 750,000 t)
Cassava (more than 2 million t)
Coco yam (more than 750,000 t)
Yam (more than 120,000 t)
Groundnuts (about 140,000 t)
Irish potato (more than 35,000 t)
sorghum (more than 350,000 t)
Major agro-industrial companies include:
Cameroon Rubber Company (HEVECAM)
15,000 hectares of rubber plants
A conditioning manufacturing industry with a capacity of 26,412 tons of rubber (94/95)
4300 full-time workers
Based in Niete
Cameroon Development Corporation (CDC)
The largest single employer after the State with 25 000 employees. The main products are:
Palm oil and palm nuts
Tea
Rubber
Banana
Cotton Development Company (SODECOTON)
Capacity
Eight factories with 152,815 tons of cotton
62,808 tons of fibre produced
76,340 tones of triturated grains.
11,345 million litres of oil.
35,101 tons of
1527 workers
Based in Garoua
Cameroon Sugar Company (SOSUCAM)
It produces more than 60,000 tons and employs 4000 people.
Cameroon Oil Palm Company (SOCAPALM)
It produces more than 50,000 tons of palm oil and more than 9,000 tons of palm nuts. Apart from industrial plantations, there is a traditional agriculture through food and cash crops. Food crops: they are essentially made up of cassava, yam, and Irish potato Cereals (corn, sorgho, groundnuts) and others (plantain and banana, wheat, sugar cane and pineapple) Cash crops: (rubber, palm trees, tea, banana, cocoa, coffee, tobacco, sugar-cane, pineapple)
However, Cameroon's agriculture faces many obstacles, which impede its development. They are:
Climate (heat and humidity)
Poverty
Transportation
Literacy
The power of tradition
Archaic land regimes
Old plantations
The destruction of cultures
Low prices
Lack of financing
ANIMAL HUSBANDRY
Animal husbandry is among the major activities of Cameroon's economy. Due to natural and human factors, this activity is carried out in different ways throughout the national territory with the predominance of traditional methods. Public Authorities have a great influence on the sector, which faces some problems.
In 1998-1999, the country's cattle stood at some 5 million heads, 2,9 million sheep/goats, 1,2 million pigs and 31 million birds (chicken). Self-sufficient, the country annually exports about 90 000 cattle to neighbouring Nigeria, about 9000 cows and 3000 sheep/goats to Gabon, and about a thousand heads of small ruminants to Congo and Equatorial Guinea.
Different types of animal breeding in Cameroon
Cattle (zebus in the Adamaoua and the North)
Goats and sheep
Pigs
Horses and donkeys
Poultry
Animal husbandry areas
Cattle: Adamaoua, North and North-west
Goats and sheep: almost dhroughout the country but especially in the North and the Adamaoua
Pigs: West, Littoral, Centre, East, and South-west
Horses and donkeys: North, West, Northwest
Poultry: in all the regions of the country but especially in the West, the Centre and the South.
FISHING INDUSTRY
The country is endowed with a 400-km coast line, but its maritime waters do not quite appear as fish-rich, hence obliging industrial fishing boats to venture way out into the high seas for appreciable catches. Costs appear rather high for such fishing, hence it is mainland fishing that accounts for much of the country's 120 000 tonnes annual production. Mainland fishing is largely concentrated on big rivers like the Benoue, Logone, Chari, Sanaga, as well as Lake Chad and the dams of Lagdo, Mbakaou, Bamendjin and Maga.
Elsewhere, the fishing industry produces about 500 tonnes of prawns. Yields from subsistent fishing inland are rather marginal. Coastal fishing is largely concentrated in Kribi, Douala, Limbe and Ndian.
Overall, production falls way short of demand, hence imports, like in 1997, are sometimes as high as 65 000 tonnes.
ENVIRONMENT AND FOREST
 THE FOREST
Cameroon has Africa's second largest forest resources. Its forests cover some 22,8 million hectares (40% of the national territory), 17.5 million hectares of which are open to industrial exploitation. Inventories carried out over 13 million hectares identified more than 200 wood species; out of these, only about 40 species are currently being exploited; the most sought after being the sapelle, acajou, iroko, mohabi, azobé, sipo and the movingui.
. Out of 200 tree species, 80 can be commercialised. Its main features are the following:
· A forest surface of 22.8 million hectares, including 1.4 million hectares protected that is 6.1% and 21.4 million hectares unprotected.
· 17.5 million hectares which can be economically exploited and representing 10% of activity in the primary sector
· The global revenue from industrial timber production is about 230 million, representing 10% of the GNP.
· The forestry sector employs 25,000 people and represents 9% of fiscal revenue and 28% of export earnings |
· In the area of forest exploitation, Cameroon is the 5th world exporter of tropical timber and the 2nd exporter of tropical timber in the Congo basin. The main regional importers of Cameroon's timber are: Asia 51%, Europe 47%, Africa 2%.
The most exploited timber species in terms of volume are: Ayous (30%), Sappelli (7%), others (63%)
A national environmental management programme has been adopted in order to preserve the forest and so far, more than 36,110 hectares of forest have been regenerated.
THE ENVIRONMENT
Cameroon has 10 major ecological regions, four regional units, and three urban units. They are as follows:
The Mandara Mounts (Volcanic)
The Far Northern plains (YAERE)
The BENOUE valley
The ADAMAOUA upper savannah
Lower Savannah in the Centre and the East
The Tikar plains
Western highlands (Bamoun, Bamileke, Grass Fields)
The Maritime coast (beaches and mangrove)
Degraded forests in the Centre and in the Littoral
The Humid dense forest in the South West and in the East
The four regional ecological units:
The Sudan-sahel area
The savannah area
The coastal and maritime area
The tropical forest area
The three urban ecological units:
Douala
Yaounde
Bafoussam
Half of the birds and mammalian species existing in Africa are found in Cameroon.
The richness and diversity of the Cameroonian flora can be observed in mainly three areas:
The Korup National Park
Mount Cameroon
The Dja reserve, which has been classified as world biodiversity heritage by UNESCO
MINING RESOURCES
Cameroon's subsoil is very rich and very diversified. The following resources have been identified:
- Petroleum: Cameroon's production has decreased since 1985. The exploitation of marginal oil fields, and mostly the Ebome drilling, which will yield 10,000 barrels per day, will surely foster the oil sector. Presently, half a dozen of companies have exploitation licences in the country (for more information see below).
- Natural gas: there are important quantities of natural gas in the different basins found in Cameroon; these quantities are mostly concentrated in the Kribi and Douala basins, but also in the RIO DEL REY.
- Rutile: It was discovered in Cameroon in 1978. Its exploitation could generate more than 40 thousand million CFA francs for a production of 100,000 tonnes.
- Bauxite: the major deposits are Mini-Martap; Fongo-tongo near Dschang. The government is presently analysing the problems, which have so far prevented the exploitation of these important deposits.
- Disthene: 200,000 tones were discovered in the deposit of Otite, Nanga -Eboko in the Centre province and in Edea in the Littoral province.
- Irons: hematite deposits were discovered in Kribi. They should contain about 120 million tonnes. Other deposits exist in the Ndop and Nwa localities.
- Limestone: Figuil deposits in the North are presently exploited for the making of cement. Studies revealed the presence of cimestone in Nkonpina the North of Douala, in Ngol, in the North of Nkongsamba and in the region of Moungo-Mbalangui
- Marble: It is exploited in North Cameroon deposits for the making of cement. Its reserves are estimated at 3500,000 tonnes.
- Pozzolana: deposits were discovered in the West and Littoral provinces. It reserves are estimated at 2,500 000 tonnes.
- Tin: the Mayo-Darle (Adamaoua) mine has been reactivated, and the production reaches 100 tons per year.
PETROLEUM
Despite its location in the Golf of Guinea, Cameroon is a modest producer of Petroleum compared with neighbouring countries. In order to reverse the decline in production, the government has taken steps to encourage prospecting by granting new permits to off-shore companies and by improving the regulations governing trade of marginal hydrocarbon deposits.
Liberalization of activity in the petroleum sector has meant the suppression of the crude oil monopoly. Created by the State in 1980 to promote the exploitation of hydrocarbons, the NHC (National Hydrocarbon Company) also works in association with other operating companies. Cameroon markets shares of its crude oil internationally, and its clients include major trading companies.
Thanks to its ability to capitalize on the advantages of a favourable international market, the NHC transferred 305,278 billion FCFA to the Public Treasury in 2000. Activity in the petroleum sector in 1999-2000 has been marked by an increase in crude oil prices on the international market, and the increase of the US dollar. Cameroon has taken benefit from this temporary situation, increasing the differentials from the development of its crude oil. Similar gains have been made in operations with the reduction of production costs, although national production of crude oil has seen a decline of 7% since the beginning of the fiscal year due to its aging production facilities.
Nevertheless, the NHC and its partners are actively engaged in fighting this recent decline by renewing the operation of sites that have already been determined, including one at Boa Sud in the Rio del Rey basin and several others in the Douala/Kribi-Campo basin.
The goal is to emphasize on the exploitation of new deposits. The NHC has therefore focused on expanding its marketing in London and Houston in order to interest petroleum companies in the resources Cameroon has to offer. The realization of a Chad/Cameroon pipeline is underway. The NHC currently works in association with 7 operating companies.
MAJOR WORKS, DEVELOPMENT AND PROJECTS
The Directorate of Major Works (DGTC) has been created on November 1988. Its major duties are to identify and carry out preliminary studies, prepare the files, as well as to seek funds and prepare the budget for major works. On the international tender side, it oversees the tender offer, effective work, control and receives the finished job.
The Directorate is undergoing major changes to meet with the growing demand of its services. Two specialised units have been created: foreign finance and agro pastoral. Other reforms are also in the pipeline to protect small and medium-sized enterprises.
DGTC will also contribute to one of the major projects in the central sub-region, the Chad-Cameroon pipeline. The project involves the development of oil fields in Southern Chad, particularly in Doba, the construction of a pipeline for crude oil exports from Chad to Kribi in Cameroon, as well as a terminal at the shores of the Atlantic in Kribi.
The pipeline in steel would have a 76 cm diameter, and would run across the country over a distance of 830 km. Two pumping stations have been earmarked along the pipeline, one at Dompla and the other at Belabo. A pressure control point is envisaged closed to the terminal in Kribi.
The crude oil would be preserved in offshore tanks about 15 km from where it would be pumped. Major works would be done at almost all levels including road and railway infrastructures. A bridge is also envisaged over river Mbere at the Cameroon-Chad border.
WATER AND ENERGY
For its needs in electrical power, Cameroon has big dams in Edea (Song-Loulou), Garoua (Lagdo), Tibati (Mbakaou), Noun (Bamendji); rural electrification is also improving; it has moved from 5 % five years ago to 15 % presently.
INDUSTRY
Cameroon's industrial development is second only to Ivory Coast's. In 1997-1998, manufacturing accounted for about 28% of GDP, with 42% exported. Given the fact that half of the country´s industrial output comes from only 19 employing no more than five hundred people, this sector offers huge opportunities for lateral expansion.
A UNDP/UNIDO industrial plan is supporting private initiatives, related to the development of food industries, livestock, fisheries, heavy industries, and technological know-how. The State has also provided a number of fiscal incentives so as to channel investments into the productive sector.
The contribution of the agro-industry to GDP has evolved from FCFA 249 billion in 1990 to FCFA 426 billion in 1998. Agro industrial exports have been boosted by corporations such as CDC (diversified production), HEVECAM (rubber), SOCAPALM and PAMOL (Palm Oil), SODECOTON (cotton) and SOSUCAM (sugar).
Industrial production is mainly concentrated in Douala, which hosts 70% of the country's industrial plants.
CONSTRUCTION
The construction industry, which in 1997-1998 contributed FCFA 114 billion to the country's GDP, acts - as in many other countries - as a catalyst over secondary industries (metal, chemical, plastics, for instance). After a slump occasioned by cuts in public spending during the hard, lean years of austerity, the construction industry is regaining strength. Prospects look particular bright for the sub-regional market.
Other industries to benefit from the rebound in the construction sector include metal production (iron bars), marble production, and corrugated iron sheets for roofing. Several major road construction projects, and in particular the Bertoua-Garoua Boulaï highway leading to the border with the Central African Republic, should have a favourable impact on this crucial economic sector.
SERVICES
The tertiary sector accounted for 31% of the country's GDP in 1989-1990. It is mainly represented by the transportation sector. If the road remains the main way of transportation, rail transportation is performing extremely well; the latest carries 283 million passengers, 1.4 million tons of goods per kilometre - according to 1997-1998 figures - with a total value of FCFA 26,5 billion.
Maritime transportation has also increased since the privatisation of CAMSHIP (Cameroon Shipping Lines). The same phenomenon on air traffic has been observed with CAMAIR´s privatisation process.
The tertiary sector also includes the informal sector whose output is difficult to assess, but an estimated 3 million people were by 1997-1998 believed employed in the sector, which is believed to have accounted for as much as 50% of GDP in 1998.
RESEARCH AND DEVELOPMENT
1997-2001 are important years in Cameroon's scientific and technological development.
Eighteen national research programmes have been created since September 1998. Some of these programmes have already kicked-off such as the programme against AIDS, malaria, etc. Others have been realised with the help of the private sector and are remarkable success stories like the Njombé banana plantations, the palm oil plantations in Dibamba, etc.
Agricultural research made a great leap forward in 1998-1999, thanks to a 10 million-dollar loan from the African Development Bank (ADB).
FINANCIAL SYSTEM
The banking system is one of the most thriving sectors in the sub-region. In conformity with its policy of liberalising the private sector, BICEC was privatised on January 2000. The Union Bank of Cameroon (UBC) with a capital of 3 billion FCFA was created, bringing to 10 the number of commercial banks in Cameroon.
The reconstruction of the banking sector has yielded positive dividends. The government strictly adheres to the IMF's pilot project that guarantees financial stability in the country. An in-depth financial assessment of the eight major commercial banks in Cameroon, revealed a sum of 732, 9 billion FCFA deposited as from February 2000 against 638,2 billion FCFA during the previous year (an increase of 94,7 billion FCFA). Private deposits during this period totalised 586 billion FCFA.
Government also has an eye on the non-banking sector. Mention should be made of the insurance sector. A provisional administrator in charge of liquidating the CNR was appointed in October 1999. The insurance sector thrived with one billion standing capital between 1997-1998 and 1998-1999. The insurance sector employs roughly 4500 persons with a salary of 4 billion FCFA. It is mostly made up of insurance companies and technical experts. Co-operatives and credit unions also form part of the informal financial sector.
FOREIGN INVESTMENTS
From 1984 to 1998, foreign investments saw a decline of 72,66%, while exports were relatively stables. While the integration rate of Cameroon in the global economy, calculated by the World Bank for the period 1984-1998 was only 2,2%, it still surpassed the integration rate of sub-Saharan Africa.
The gross investment rate in Cameroon has climbed from 18,8% in 1997-1998 to 20,1% in 1998-1999. The most significant investment projects in the private sector are related to the construction of major roads, the supply of the Sahelian region of Makolo-Mora with drinking water, the dredging of a channel off the Douala Port, and the construction of 30 schools, a hospital as well as a paediatric centre.
Most foreign investors operating in Cameroon are well known international firms operating on the basis of joint-venture agreements. The National Investment Company has a number of interests in some of these joint-ventures.
French investors have always been extremely present in Cameroon. Though suffering some losses between 1991 and 1995, they returned to profitability in 1996.
Over the past two years, the Chinese business community also made significant investments; among these, mention should be made of the two manufacturing plants in agricultural machinery, and truck tires. Chinese investments represent approximately two million dollars.
Cameroon has welcomed a number of important international corporations who have come to Cameroon because of its modernization efforts, increasingly stronger infrastructure and its human quality. |
