Economy of Cameroon

Economy of Cameroon

Currency	CFA Franc (XAF)
Fiscal year	Calendar year
Trade organisations	AU, WTO
Statistics
GDP	$30.17 billion (2004) Rank: 91st (2004)
GDP growth	4.9% (2004)
GDP per capita	$577(2004)
GDP by sector	agriculture (43.7%), industry (20.1%), services (36.2%) (2004)
Inflation (CPI)	.02% (2004)
Population below poverty line	48% (2000)
Labour force	4.2 million (2004)
Labour force by occupation	agriculture (70%), industry and commerce (13%), other (17%)
Unemployment	30% (2001)
Main industries	petroleum production and refining, aluminum production, food processing, light consumer goods, textiles, lumber, ship repair
External
Exports	$2.445bn (2004)
Export goods	crude oil and petroleum products, lumber, cocoa beans, aluminum, coffee, cotton
Main export partners	Spain 16.2%, Italy 14.1%, France 10.2%, UK 9.9%, U.S. 9.6%, Netherlands 5.1% (2004)
Imports	$1.979bn (2004)
Import goods	machinery, electrical equipment, transport equipment, fuel, food
Main import partners	France 28.2%, Nigeria 9.4%, Belgium 7.6%, U.S. 4.8%, Germany 4.6%, the People's Republic of China 4.4%, Italy 4%
Public finances
Government debt	69.1% of GDP {2004)
Revenues	2.493bn 2004)
Expenses	$2.248bn (2004)
Economic aid	The Paris Club agreed to reduce Cameroon's debt of $1.3 billion by $900 million, debt relief now totals $1.26 billion (2001)
Credit rating	B (Domestic) B (Foreign) BBB- (T&C Assessment) (Standard & Poor's)
Main data source: CIA World Fact Book All values, unless otherwise stated, are in US dollars.

For a quarter-century following independence, Cameroon was one of the most prosperous countries in Africa. The drop in commodity prices for its principal exports —petroleum, cocoa, coffee, and cotton — in the mid-1980s, combined with an overvalued currency and economic mismanagement, led to a decade-long recession. Real per capita GDP fell by more than 60% from 1986 to 1994. The current account and fiscal deficits widened, and foreign debt grew. Yet because of its oil reserves and favorable agricultural conditions, Cameroon still has one of the best-endowed primary commodity economies in sub-Saharan Africa.

Macro-economic trend

This is a chart of trend of gross domestic product of Cameroon at market prices estimated by the International Monetary Fund with figures in millions of Central African CFA Francs.

Year	Gross Domestic Product	US Dollar Exchange
1980	1,600,186	209.20 Francs
1985	4,355,977	471.12 Francs
1990	3,804,428	300.65 Francs
1995	4,686,286	518.62 Francs
2000	6,612,385	658.21 Francs
2005	8,959,279	527.29 Francs

Cameroonian farmers tend to cultivate at the subsistence level.

The government embarked upon a series of economic reform programs supported by the World Bank and IMF beginning in the late 1980s. Many of these measures have been painful; the government slashed civil service salaries by 65% in 1993. The CFA franc — the common currency of Cameroon and 13 other African states — was devalued by 50% in January 1994. The government failed to meet the conditions of the first four IMF programs.

Recent signs, however, are encouraging. As of March 1998, Cameroon's fifth IMF program — a 3-year enhanced structural adjustment program approved in August 1997 — is on track. Cameroon has rescheduled its Paris Club debt at favorable terms. GDP has grown by about 5% a year beginning in 1995. There is cautious optimism that Cameroon is emerging from its long period of economic hardship.

Cameroonian exports in 2006

The Enhanced Structural Adjustment Facility (ESAF) signed recently by the IMF and Government of Cameroon calls for greater macroeconomic planning and financial accountability; privatization of most of Cameroon's nearly 100 remaining non-financial parastatal enterprises; elimination of state marketing board monopolies on the export of cocoa, certain coffees, and cotton; privatization and price competition in the banking sector; implementation of the 1992 labor code; a vastly improved judicial system; and political liberalization to boost investment.

France is Cameroon's main trading partner and source of private investment and foreign aid. Cameroon has an investment guaranty agreement and a bilateral accord with the United States. USA investment in Cameroon is about $1 million, most of it in the oil sector. Inflation has been brought back under control.

Finance and Banking

Cameroon’s financial system is the largest in the CEMAC region. Access to financial services is limited, particularly for SMEs. Aside from a traditional tendency for banks to prefer dealing with large, established companies, determining factors are also found in interest rates for loans to SMEs being capped at 15 percent and being heavily taxed. As of 2006, bank loans to SMEs hardly reached 15 percent of total outstanding loans.

Less than 5 percent of Cameroonians have access to a bank account. While the microfinance sector is consequently becoming increasingly important, its development is hampered by a loose regulatory and supervisory framework for microfinance institutions (MFIs). The banking sector is highly concentrated and dominated by foreign commercial banks. 6 out of the 11 largest commercial banks are foreign-owned, and the three largest banks hold more than 50 percent of total financial system assets. While foreign banks generally display good solvency ratios, small domestic banks are in a much weaker position. Their capitalization is well below the average of banks in the CEMAC region and their profits are close to 2 percent, compared to 20 percent for foreign banks in the country. This is partially explained by the high levels of non-performing loans, which reached 12 percent in 2007, leading to most banks holding large amounts of excess reserves as a percentage of deposits and large levels of unutilized liquidity.

See also

• Cameroon
• Transport in Cameroon

External links

• Economy of Cameroon at Curlie
• Cameroon latest trade data on ITC Trade Map