REPUBLIC OF CAMEROON Peace-Work-Fatherland
MINISTRY OF FINANCE
2021 FINANCE LAW
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK
2020 FISCAL YEAR Current and previous versions of this report are available in english and french on the following websites : www.minfi.gov.cm www.dgb.cm 2021 FINANCE LAW
Table of contents
List of tables ...... v List of graphs ...... vii Boxes ...... ix
CHAPTER 1: OVERVIEW ...... 1 1.1. Global Economic Environment ...... 1 1.2. Recent Trends in Cameroon’s Economy ...... 3 1.2.1 Growth and prices ...... 3 1.2.2 Relations with the rest of the world ...... 5 1.2.3 Currency and financing of the economy...... 6 1.2.4 Public finances...... 8 1.2.5 Social sectors ...... 9 1.2.6 Structural and institutional reforms ...... 11 1.3. Macroeconomic and Budgetary Outlook for the 2020-2023 period ...... 14 1.3.1 Macroeconomic situation during the 2020-2023 period ...... 14 1.3.2 Macroeconomic Outlook for 2021-2023 ...... 15 1.3.3 2021-2023 Budget outlook ...... 16 1.3.4 Budgetary constraints and risks for 2021...... 16
CHAPTER 2: PRODUCTION ...... 19 2.1 Primary Sector ...... 19 2.1.1 Agriculture ...... 19 2.1.2 Livestock breeding, fishing and fish farming...... 24 2.1.3 Forestry and wildlife subsector ...... 28 2.1.4 Environment and nature protection ...... 31 2.1.5 Research and innovation ...... 31 2.2 Secondary Sector ...... 32 2.2.1 Manufacturing industries ...... 32 2.2.2 Extractive Industries ...... 35 2.2.3 Electricity generation and distribution ...... 37 2.2.4 Production and distribution of water and sanitation ...... 38 2.2.5 Public works and civil engineering ...... 38 2.3 Tertiary sector ...... 41 2.3.1 Trade ...... 42 2.3.2 Tourism ...... 43 2.3.3 Transport ...... 44 2.3.4 Telecommunications ...... 47 2.3.5 SMEs, social economy and handicrafts ...... 48
CHAPTER 3: DEMAND, PRICES AND COMPETITIVENESS ...... 49 3.1 Analysis of demand components ...... 49 3.1.1 Domestic demand ...... 49
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3.1.2 External demand ...... 51 3.2 Prices ...... 55 3.2.1 Final household consumer price ...... 55 3.2.2 Global competitiveness ...... 57
CHAPTER 4: FINANCING OF THE ECONOMY ...... 59 4.1 Monetary Policy ...... 59 4.1.1 Refinancing policy...... 59 4.2 Money Market Operations ...... 60 4.1.2 Interest rate steering policy ...... 60 4.2.1 Money market conventional operations ...... 61 4.2.2 Twenty-four hour marginal lending facility ...... 61 4.2.3 Twenty-four hour marginal lending facility ...... 62 4.2.4 Interbank market ...... 62 4.3 Statutory reserves policy ...... 62
4.4. Situation monétaire ...... 62 4.4.1 Money supply counterparts ...... 63 4.4.2 Money supply ...... 65 4.5 Banking Sector ...... 65 4.5.1 Balance sheet total ...... 66 4.5.2. Customer deposits ...... 66 4.5.3 Customer credits ...... 67 4.5.4 Prudential ratios ...... 68 4.5.5 Electronic money ...... 68 4.6. Microfinance...... 69 4.6.1 Distribution of MFIs by category ...... 69 4.6.2 Geographic coverage ...... 70 4.6.3 Trends in overall balance sheets ...... 70 4.6.4 Deposits trends ...... 70 4.6.5 Credit trends ...... 71 4.6.6 Performance trends ...... 71 4.6.7 Compliance with prudential ratios ...... 72 4.7 Financial Institutions ...... 72 4.8 Insurance ...... 73 4.9 Stock Market ...... 74 4.9.1 Share market ...... 74 4.9.2 Bond market ...... 76 4.10 Government Securities Transactions ...... 77 4.11 Strategy for financing the economy over the period 2020-2023...... 78
CHAPTER 5: EXTERNAL SECTOR ...... 79 ii REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW
5.1 External Trade ...... 79 5.1.1 Trade balance ...... 79 5.1.2 Geographical orientation of trade ...... 83 5.2 Balance of Payments ...... 90 5.2.1 Balance of current account transactions ...... 91 5.2.2 External financing...... 94 5.2.3 Balances of payments by sector ...... 95 5.2.4 Bilateral balances of payments ...... 97
CHAPTER 6: SOCIAL SECTOR ...... 103 6.1 Education ...... 103 6.1.1 Basic education ...... 105 6.1.2 Secondary education ...... 106 6.1.3 Higher education ...... 109 6.2 Health ...... 111 6.2.1 Maternal and child health and immunization coverage ...... 112 6.2.2 Epidemiological surveillance, disease control and health promotion ...... 113 6.3 Employment, Vocational Training and Social Security ...... 118 6.3.1 Employment trends ...... 118 6.3.2 Vocational training ...... 119 6.3.3 Promotion of social protection and security ...... 119 6.4 Town Planning and Housing ...... 120 6.4.1 Housing development ...... 120 6.4.2 Environmental improvement and urban sanitation ...... 121 6.4.3 Urban transport infrastructure development ...... 122 6.5 Social Affairs, Gender, Family and Youth Promotion ...... 122 6.5.1 Social affairs...... 123 6.5.2 Women’s empowerment and the family ...... 123 6.6 Fight againt Poverty: Social Safety Nets ...... 125
CHAPTER 7: EXECUTION OF THE 2020 BUDGET AND THE 2021 DRAFT BUDGET ...... 127 7.1 Amending Finance Law and budgetary orientation debate ...... 127 7.1.1 Amending Finance Law ...... 127 7.1.2 Budgetary Orientation Debate (BOD) ...... 128 7.2 2020 Budget Execution ...... 130 7.2.1 Budgetary resources ...... 130 7.2.2 Budgetary expenditure execution ...... 135 7.2.3 Variation of payment arrears and basic budget balances ...... 137
7.3 Draft Budget for the 2021 Fiscal Year ...... 138 7.3.1 Revenue analysis ...... 139 7.3.2 Expenditure analysis ...... 140
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CHAPTER 8: 2020-2023 MACROECONOMIC AND BUDGETARY OUTLOOK ... 145 8.1 International Economic Environment ...... 145 8.2 Domestic Economy Trends in 2020 ...... 148 8.2.1 Supply trends ...... 148 8.2.2 Demand trends ...... 150 8.3 Government’s Strategy for the 2021-2023 Period ...... 151 8.3.1 Guidelines of the first triennium of Cameroon’s National Development Strategy (NDS 30) 152 8.3.2 Post-COVID-19 economic recovery plan ...... 154 8.3.3 Support plan for the production and processing of mass consumer goods ...... 155 8.4 Macroeconomic and budgetary projections for the 2021-2023 period ...... 155 8.4.1 Macroeconomic projections over the 2021-2023 period ...... 155 8.4.2 Budgetary framework for the 2021-2023 period ...... 160 8.4.2.1 Budgetary framework in 2021 ...... 160 8.4.2.2 Budget projections for the 2021-2023 period ...... 165
GLOSSARY OF ACRONYMS ...... 167
EDITORIAL BOARD ...... 171
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List of tables
Table 1: Some Global Economy Performance Indicators ...... 3 Table 2: Agro-industrial Production, Exports and Prices ...... 21 Table 3: Production of Major Food Crops (in tonnes) ...... 23 Table 4: Trends in Livestock Population and Quantity of Slaughter Meat ...... 26 Table 5: Trends in Livestock By-products (in tonnes) ...... 27 Table 6: Production and Exports in the Forestry Sector (in m3) ...... 28 Table 7: Hunting Plan and Results in Hunting Zones ...... 29 Table 8: Trends in Activities in Protected Areas ...... 30 Table 10: Growth Rate by Agribusiness Industry Branch (%) ...... 33 Table 11: Growth rate trends in other manufacturing industries (%) ...... 34 Table 12: Crude Oil Production (in millions of barrels) ...... 36 Table 13: Natural Gas Production (in billions of cubic feet)...... 36 Table 14: Light and Heavy Petroleum Products Released for Consumption (in thousands of litres).... 36 Table 15: Cooking Gas Supply (in metric tonnes) ...... 37 Table 16: Electric Power Supply* (in MWH) ...... 38 Table 17: Civil Engineering Project Implementation Rate in 2019 (%) ...... 39 Table 18: Road Project Implementation Rate in 2019 (%) ...... 40 Table 19: Tertiary Sector Growth Trends (in %) ...... 41 Table 20: Growth Rate of Trade Margins by Product (in %)...... 42 Table 21: Breakdown of the Number of Classified Hotels by Region and by Category in 2019.. 44 Table 22: Number of New Vehicle Registrations by Category ...... 44 Table 23: Number of Registered Vehicles by Age ...... 45 Table 24: Number of “Carte Bleue” and Licences Issued for Road Transport ...... 45 Table 25: Road Accidents ...... 45 Table 26 : Rail Traffic Trends...... 46 Table 27 : Maritime Traffic Trends...... 46 Table 28 : Air Transport Trends ...... 46 Table 29 : Oil Pipeline Transport Trends ...... 47 Table 30 : Telecommunications Subsector Activity Trends ...... 48 Table 31 : PIB Breakdown by Sector (in billions of CFA francs) ...... 51 Table 32 : Trends in goods export by major product group (%) ...... 53 Table 33 : Trends in Product Imports by Branch (in%) ...... 53 Table 34 : Evolution des emplois du PIB (en%) ...... 55 Table 35 : Trends in final household consumption price index ...... 56 Table 36 : Trends in REER, NEER and Terms of Trade from 2013 to 2019 (in %) ...... 60 Table 37 : Trends in BEAC’s policy rates and banking conditions ...... 62 Table 38 : Consolidated monetary situation (in billions) ...... 63 Table 39 : Deposits by Customer Type (in billions) ...... 66 Table 40 : Customer Deposits by Maturity (in billions) ...... 67 Table 41 : Credit Distribution by Customer Type (in billions) ...... 68 Table 42 : Breakdown of certified mfis by category...... 69 Table 43 : Breakdown of MFIs Registered under the Special Register of the National
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK v MINISTRY OF FINANCE
Credit Council by Category ...... 70 Table 44 : Trends in MFIs Overall Balance Sheet (in billions)...... 70 Table 45 : Trends in Deposits in MFIs (in billions) ...... 71 Table 46 : Trends in balance sheet total of financial institutions (in billions)...... 72 Table 47 : Trends in Insurance Sector Activity (in billions) ...... 73 Table 48 : Stock Market Capitalization of the BVMAC (in billions) ...... 75 Table 49 : Situation of the Bond Market (in billions) ...... 76 Table 50 : Volume and Value of Transactions on the Bond Market of the DSX ...... 77 Table 51 : Situation of Government Securities as at 31 August 2020 (in billions) ...... 77 Table 52 : External Trade Trends (in billions) ...... 80 Table 53 : Export Trends (Q: quantity in thousands of tonnes, V: value in billions) ...... 81 Table 54 : Import Trends (Q: in thousands of tonnes, V: in billions) ...... 82 Table 55 : Trends in Goods Trade by Geo-economic Area in 201 9 (in billions) ...... 86 Table 56 : Cameroon’s Major Customers ...... 88 Table 57 : Trends in the Major Products Exported to Major Customers (in billions) ...... 88 Table 58 : Cameroon’s Major Suppliers ...... 90 Table 59 : Overall Balance of Payments from 2015 to 2019 (in billions) ...... 90 Table 60 : Balance of billions (in services ) ...... 92 Table 61 : Balance of Payments by Sector (in billions) ...... 96 Table 62 : Balance of Payments by Sector (in billions) ...... 97 Table 63 : Balance of Payments with Nigeria, China and the United States (in billions)...... 98 Table 64 : Balance of Payments with France, CEMAC and the European Union (in billions). 99 Table 65 : Monthly Balance of Payments for the First Half of 2020 (in billions) ...... 100 Table 66 : Balance of Payments from 2014 to 2019 (in billions) ...... 101 Table 67 : Number of Functional Classrooms, Pupils and Teachers in Pre-school and Primary Education ...... 105 Table 68 : Pupil/Teacher and Pupil/Classroom Ratios in Nursery and Primary Education... 106 Table 69 : Trends in the Number of Secondary Schools ...... 107 Table 70 : Number of Students, Teachers and Classrooms in Secondary Education ...... 108 Table 71: Success Rates for Official Secondary School Examinations (in %)...... 109 Table 72 : Distribution of Students and Lecturers in Higher Education ...... 111 Table 73 : Immunization Coverage Trends (%) ...... 113 Table 74 : Distribution of Jobs Created from 2017 to 2019 ...... 118 Table 75 : PLANUT Social Housing Execution Rate in 2019 ...... 121 Table 76 : Works Execution Rate in Various Councils ...... 121 Table 77 : List of Projects Executed in 2019 under the Labour-Intensive Public Works Programme.... 125 Table 78 : Budget Resources for the 2020 Financial Year (in billions, unless stated otherwise) 134 Table 79 : Budgetary Expenditure for the 2020 Financial Year (in billions) ...... 138 Table 80 : Revenue Breakdown ...... 139 Table 81: State Expenditure Structure (in billions) ...... 141 Table 82 : Proposed Appropriations Opened for the 2021 Financial Year (in millions) ...... 142 Table 83 : Some Global Economy Performance Indicators ...... 146 Table 84 : GDP Breakdown by Sector (in %) ...... 151 Table 85 : Projections budgétaires ...... 164 Table 86 : Key Macroeconomic Indicators ...... 165 vi REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW List of graphs Graph 1 : Breakdown of Production by Fishing Type ...... 25 Graph 2 : Trends in the Demand Component (in %) ...... 49 Graph 3 : Comparative Trends in GDP and Consumption Components ...... 50 Graph 4 : Percentage of net external demand contribution to growth ...... 52 Graph 5 : Trends in the Contribution of Net External Demand for Goods to Growth ...... 52 Graph 6 : Trends in the Contribution of Net External Demand for Services to Growth ...... 54 Graph 7 : Amounts served by BEAC to banks (in % of tenders expressed by banks) ...... 61 Graph 8 : Interbank Transactions in billion CFA francs ...... 62 Graph 9 : Weight of Net Foreign Assets Components (in %) ...... 64 Graph 10 : Net Government Position (in billions) ...... 65 Graph 11 : Money Supply Components ...... 65 Graph 12 :Trends in Market Share by Branch from 2015 to 2019 (in %) ...... 73 Graph 13 : BV MAC Share Price Trends (in CFA francs) ...... 75 Graph 14 : Trade Balance from 2008 to 2019 (in billions) ...... 79 Graph 15 : Breakdown of Trade Total by Geographical Area in 2019 (in %)...... 83 Graph 16 : Breakdown of Exports by Geographical Area in 2019 (in %) ...... 84 Graph 17 : Breakdown of Imports by Geographical Area in 2019 (in %) ...... 84 Graph 18 : Current Account Balance Trends from 2015 to 2020 (in billions) ...... 91 Graph 19 : Breakdown of Travel Revenue by Area of Origin in 2019 ...... 93 Graph 20 : Breakdown of Migrant Remittances by Area of Origin in 2019 ...... 94 Graph 21: Trends in the Active List of People Receiving ARV Therapy ...... 115 Graph 22 : Trends in the Number of State Personnel from 2010 to 2019 ...... 118 Graph 23 : Domestic Revenue Forecasts and Achievements from 2015 to 2020 (in billions).. 131 Graph 24 : Trends in the Main Components of Domestic Revenue from 2015 to 2020 ...... 131 Graph 25 : Projections and Execution of Taxes and Duties from 2015 to 2020 (in billions).. 132 Graph 26 : Customs Revenue Forecasts and Execution from 2015 to 2020 (in billions)...... 133 Graph 27 : Breakdown of State Budget Expenditure from 2014 to 2020 (in % of the total).. 135 Graph 28 : Sector Breakdown of GDP for the 2020 Financial Year ...... 136 Graph 29 : Breakdown of Outstanding Public Debt and Endorsed Debt as at 30 June 2020...137 Graph 30 : Breakdown of Outstanding External Public Debt as at 30 June 2020 ...... 137 Graph 31 : GDP Trajectories With and Without the Crisis ...... 156
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2021 FINANCE LAW
Boxes Box 1: COVID-19 SAA ...... 129 Box 2: Potential Growth and Medium-term Scenario ...... 156
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2021 FINANCE LAW
CHAPTER 1: OVERVIEW Regarding the drafting of the State budget, Section 14 of Law No. 2018/12 of 11 July 2018 relating to the fiscal regime of the State and other public entities provides that a reporton the Nation’s economic, social and financial situation and outlook should be attached to the finance bill. This report has been drawn up to comply with this requirement. It presents: (i) the economic and financial developments in the global economy that can affect the national economy; (ii) the national economic, social and financial situation; and (iii) the macroeconomic and budgetary outlook for the 2021-2023 period. 1.1. Global Economic Environment The global economy, which grew by 2.9% in 2019, is expected to experience its sharpest decline (-4.4%) in 2020 since the 1929 Great Depression owing to the COVID 19 crisis. However, this recession would not be as severe as was forecast in June 2020 (-4.9%) due to the lifting of containment measures in many countries. With the reopening of many economies and the gradual lifting of restrictions on economic activities, global economic activities returned to normal faster than was expected. The GDP output during the second quarter came as a pleasant surprise in China where public investment enabled the economy to return to a positive growth trend after the easing of the containment measures imposed at the beginning of April. The same is true for the United States and the euro zone where the economy contracted during the second quarter, albeit less severely than initially expected, thanks to government payments to supplement household incomes. However, these estimates may be revised in the short term due to the resurgence of a second wave of the pandemic in many Western countries.
The COVID-19 pandemic-triggered slowdown in economic activity is very different from previous recessions in which the services sector was less affected than the manufacturing sector. This is because social distancing measures disrupted activities in sectors that rely on interactions between people, particularly transport, wholesale and retail trade, and the hotel, restaurant and leisure sector, which experienced greater contractions than the manufacturing sector.
Massive government intervention has helped to mitigate the effects of the pandemic. The exceptional measures announced by the governments of advanced countries represent an estimated budgetary cost of 9% of GDP. Additional measures in various forms of liquidity support, including equity injections, asset purchases, loans and credit guarantees, represented 11 % of GDP. In emerging and developing countries, the response, though smaller in scale, remains considerable, costing about 3.5% of GDP in the form of exceptional budgetary measures and 2% in the form of liquidity support.
By 2021, almost all economies are expected to gradually recover, resulting in a projected growth of 5.4% for the global economy as a whole. However, there are uncertainties about the persistence of the shock due to difficulties in predicting the trajectory of the pandemic, the adjustment costs it imposes on the economy, the effectiveness of response measures and the reaction of financial markets.
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 1 MINISTRY OF FINANCE
The magnitude of the shock and the pace of recovery vary according to zone and country. In the group of advanced countries, GDP is expected to contract by 5.8 % in 2020 as against an increase of 1.7 % in 2019, and to rebound to 3.9 % in 2021.
The United States is expected to witness a 4.3% decline and to rebound to 3.1% in 2021. In the euro zone, projections indicate a deeper contraction of 8.3% in 2020 due to a decline in activity in the countries driving the zone’s economy and a sharper downturn during the first half of the year than in the United States. Growth is projected at 5.2% in 2021.
In Japan, economic growth is expected to fall to -5.3% in 2020 owing to the drop in exports and household consumption as a result of the health crisis. A 2.3% growth is forecast for 2021.
In the United Kingdom, economic activity is expected to shrink by 9.8% in 2020. The COVID-19 crisis and Brexit, which have created a lot of uncertainty about the future, would justify this trend. In 2021, growth is projected at 5.9%.
Forecasts for emerging and developing countries as a whole predict a growth rate of -3.3% in 2020 as against 3.7% in 2019, and projected at 6% in 2021. It should be noted, however, that in this group of countries, China is doing better, thanks in part to public investment which has enabled it to return to growth during the second quarter of 2020. Its growth is estimated at +1.9% in 2020 and projected at 8.2% in 2021.
In Sub-Saharan Africa, the economy is expected to contract by 3.0% by end-2020. In the region’s major economies, contraction is estimated at: (i) -5.4% in Nigeria due mainly to the collapse of oil prices and the negative impact of containment measures; and (ii) -8% in South Africa, where the pandemic has been most severe in the zone. In 2021, growth would stand at 3.1% in Sub-Saharan Africa, with 1.7% in Nigeria and 3.0% in South Africa.
In the CEMAC zone where the economy is heavily dependent on commodity prices, growth, which was around 2.1% in 2019, is expected to fall to -3.1% in 2020, before rebounding to 3.4% in 2021. The decline is due mainly to the decrease in demand from Asia and Europe as well as falling price per barrel of oil. The resumption of growth in 2021 would be attributable, among other things, to the control of the pandemic, the rise in the price of raw materials and the resumption of activities in the zone’s main economic partners.
Regarding commodity prices, trends in the Commodity Price Index were uneven between February and August 2020. This trend had two phases: (i) between February and April, the index dropped by 24%, amid the intensification of the COVID-19 pandemic; and (ii) between May and August, the index increased by about 31%, with the easing of containment measures in many countries and the gradual recovery of the economy. However, the extent of the rebound varies according to the products, the situation in end-use sectors, the regions affected by the pandemic and the capacity to store the products considered. Concerning oil in particular, prices are forecast at an average of 41 dollars per barrel in 2020 and 43.8 dollars in 2021. The curves of oil future contracts indicate that the price would then rise to approximately 48 dollars, that is about 25% below the 2019 average.
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Inflation is expected to be 0.8% in 2020 and 1.6% in 2021 in the group of advanced countries. In 2020, the inflation rate is estimated at 5% and is projected at 4.7% in 2021 in the group of emerging and developing countries.
Table 1: Some Global Economy Performance Indicators 2019 2020* 2021** GDP Growth (in %) Global economy 2.8 -4.4 5.2 United States 2.2 -4.3 3.1 Euro zone 1.3 -8.3 5.2 Japan 0.7 -5.3 2.3 China 6.1 1.9 8.2 India 4.2 -10.3 8.8 Sub-Saharan Africa 3.2 -3 3.1 Nigeria 2.2 -4.3 1.7 South Africa 0.2 -8.0 3.0 CEMAC 2.1 -3.1 3.4 Inflation (in %) Global economy United States 1.8 1.5 2.8 Euro zone 1.2 0.4 0.9 Japan 0.5 -0.1 0.3 China 2.9 2.9 2.7 India 4.8 4.9 3.7 Sub-Saharan Africa 8.5 10.6 7.9 Nigeria 11.4 12.9 12.7 South Africa 4.1 3.3 3.9 CEMAC 2.0 2.6 2.7 Source: IMF/BEAC * Estimate ** Projections 1.2. Recent Trends in Cameroon’s Economy
1.2.1. Growth and prices
In 2019, economic activities were carried out in a context marked, among other things, by: (i) the lingering security crisis in the North-West and South-West Regions; (ii) the fire incident at the National Oil Refining Company (SONARA); and (iii) the substantial increase in oil and gas production. Real GDP growth rate stood at 3.7% as compared with 4.1% in 2018. This slowdown is attributable mainly to deceleration in the non-oil sector whose growth dropped from 4.4% to 3.5%. Conversely, the oil sector experienced an upturn with an increase of 8.5% compared with -2.7% in 2018. The trends recorded were as follows according to sector. Primary sector growth is estimated at 2.8% as against 5.1% in 2018. This deceleration is attributable mainly to: (i) the decline in activities in the “forestry and logging” branch, due mainly to the decrease in Chinese demand; and (ii) the sluggishness of “agriculture”, “subsistence agriculture” and “industrial and export agriculture”. However, cocoa and cotton production remained buoyant, sustained by good prices for these products, local demand by cocoa bean
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processing industries, and the improvement of SODECOTON’s production facilities. Livestock activities continued to show an upward trend with a growth rate of 5.5% compared with 4.4% in 2018. This trend was sustained, among other things, by the good performance of live animal production, including cattle, pigs and poultry. Growth in the secondary sector improved to stand at 4.9% compared with 3.1% in 2018, due mainly to the strong performance of the industrial sector, the vitality of the public works and civil engineering sector and the revival of oil and gas activities after several years of poor performance. After three consecutive years of decline, oil production recorded a positive growth of 8.9% following the development of new oil fields. Gas production remained strong with a 37% increase. Industrial activities progressed by 4.1% compared with 3.1% in 2018, mainly driven by the vitality of the “cocoa, coffee, tea, sugar and oilseed”, “milk, fruit and vegetable”, “textile and clothing”, and “timber processing” industries. Though it experienced a slowdown, the “building and public works (BPW)” branch remained buoyant (4.7% in 2019 as against 7.6%), with the completion of major first-generation projects and infrastructure and equipment related to the hosting of CHAN 2021 and AFCON 2022. However, growth in the secondary sector was hampered by the cessation of SONARA’s activities and the poor performance of the metallurgical industries. The tertiary sector grew by 3.0% compared with 4.4% in 2018. This deceleration can be observed in almost all branches with varying degrees. It is more pronounced in the “restaurants and hotels” (+1.8% compared with +4.3%) and “banks and financial institutions” (+6.2% compared with +10.2%) branches. It is less pronounced in the “trade and vehicle repair” (+4.2% as against +5.1%) and “transport, warehousing and communications” branches (+3.5% as against +4.0%). The “information and telecommunications” branch has returned to a positive growth path (+3.9% as against -2.1%), due to the diversification of promotional services and the significant increase in the use of the internet. Regarding the use of GDP, the slowdown in growth is attributable to domestic demand whose contribution has dropped by 0.1 percentage point (5.6 percentage points compared with 5.7 percentage points), and net exports which further slowed down growth (-1.9 percentage point compared with -1.6 percentage point). Domestic demand slowed to stand at 5.2% from 5.4% in 2018 due to household final consumption, whose growth slowed to 4.5% from 4.7% in 2018. This was due to the rising cost of some products and services, including food, non-alcoholic beverages and catering. Moreover, public final consumption expenditure is slowing down to 1.8% compared with 3.9% in 2018, following efforts to streamline public spending amid cuts in government spending. Conversely, investment growth accelerated from 7.5% in 2018 to 8.5% in 2019, driven by the rebound in public investment (+11.4%, as against -3.1% in 2018). Private investment slowed to 7.4% as against 9.6% in 2018. With regard to net external demand, the sustained vigour of imports of goods and services continued to offset gains in export growth. This situation was reflected in the acceleration of imports (+10.6% compared with +8.1%), which was stronger than that of exports (+5% compared with +2.3%). The drive towards imports was sustained by an increase in the procurement of hydrocarbons, transport equipment, machinery and electrical appliances and cereals (rice, wheat and meslin). Exports were driven by the sale of crude oil, liquefied natural gas (LNG), sawn timber, cocoa and raw cotton.
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Regarding prices, inflation stood at 2.5% in 2019 as against 1.1% in 2018. The items that recorded the most significant increases were “food products and non-alcoholic beverages” (+2.9%), “restaurants and hotels” (+5.7%) and “clothing and footwear” (+2.8%). According to origin, the prices of local products rose by 2.6% and those of imported products by 2.2%. According to sector of activity, prices rose by 3.8% for primary products, 1.6% for those in the secondary sector and 2.1% for those in the tertiary sector. Spatially, the highest increases were observed in the towns of Bamenda (+4.8%), Buea (+3.4%), Bafoussam (+2.7%) and Ebolowa (+2.6%).
1.2.2. Relations with the rest of the world
1.2.2.1. Competitiveness
In 2019, the real effective exchange rate (REER) dropped by 1.3% compared with 2018, reflecting an improvement in the competitiveness of the Cameroonian economy. This trend followed the 0.9% depreciation in the nominal effective exchange rate (NEER) due to the depreciation of the euro against major currencies (dollar, yen and yuan). Terms of trade improved by 0.4% compared with 2018. This was the result of a greater increase in the prices of exports compared with those of imports.
To improve the competitiveness of the Cameroonian economy, the Government pursued initiatives such as: (i) the dematerialization of tax procedures and payments; (ii) the setting up of an information system for technical government services (MINADER, MINEPIA and MINFOF) on the One-stop Shop for External Trade platform; (iii) the improvement of the quality of agricultural inputs and capacity building for farmers; and (iv) the modernization of SMEs, particularly in terms of digital skills, digitalization of processes and digital visibility.
1.2.2.2. External trade
In 2019, external trade was marked by: (i) the slowdown in trade in goods (2.6% from 3.5% in 2018, according to the WTO) and in trade in services (2% from 9%); (ii) trade tensions between the United States and China; and (iii) the drop in crude oil prices. Nationally, there was: (i) the persistence of socio-political and security crises; (ii) the strengthening of the application of exchange regulations; and; (iii) the satisfactory implementation of the economic and financial programme with the IMF.
Concerning external trade, the trade balance deficit widened by 171.4 billion compared with 2018 to reach 1 464.2 billion in 2019. This situation was due mainly to an increase in import expenditure which outpaced the rise in export revenue. The deficit, excluding oil, widened by 261.5 billion to stand at 2 243.8 billion in 2019.
Total imports amounted to 3 856.9 billion, representing an increase of 451.7 billion compared with 2018. This situation was due to increased purchase of: (i) fuel and lubricants (+251.2 billion); (ii) cereals (+111.7 billion, including 87.7 billion for rice); (iii) crude oil (+47.0 billion); (iv) ceramic products (+38.8 billion); and (v) glazed tiles (+34.2 billion). Conversely, imports decreased for aluminium oxide (-28.9 billion), inorganic chemicals (-25.6 billion), frozen sea fish (-21.8 billion), electrical optical machinery (-19.4 billion) and telephone equipment (-14.0 billion).
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Total exports increased by 280.4 billion compared with 2018, to reach 2 392.7 billion. Exports increased for crude oil (+137.2 billion), liquefied natural gas (+136.9 billion), raw cocoa beans (+55.4 billion) and raw cotton (+13.0 billion). They decreased for unprocessed timber (-35.4 billion), fuel and lubricants (-22.5 billion), unprocessed aluminium (-11.0 billion) and unprocessed rubber (-6.3 billion).
The analysis of trade according to geographical area shows that the European Union remained Cameroon’s major trading partner with 31.5% of total trade in value as against 35.5% in 2018. It was followed by East Asia (23.9%), West Africa (11.8%), South-East Asia (5.8%), North America (4.9%), Eastern Europe (3.6%) and CEMAC (3.5%).
Bilaterally, China remained Cameroon’s largest trading partner with 17.7% of the total amount of trade. It was followed by France (6.4%), Italy (6.3%), the Netherlands (5.9%), Belgium (4.7%), Nigeria (4.4%), Togo (4.2%), the United States (3.9%), Thailand (3.0%) and Spain (2.2%).
Regarding total external trade, the current account balance showed a deficit of 992 billion (4.4% of GDP) as against 777.6 billion (3.6% of GDP) in 2018. This deterioration was generated by the balances of goods (-431.6 billion compared with -295 billion), services (-361.6 billion compared with -324.3 billion in 2018), and primary income (-493.8 billion compared with -410.8 billion). On the other hand, the balance of secondary revenue continued to be in surplus and improved to stand at 295 billion as against 252.5 billion in 2018. The current account deficit was financed by the net withdrawals of government services (+975.8 billion), FDIs (+527.1 billion), project grants (+133.3 billion) and net withdrawals on ordinary loans (+739.8 billion). The banking sector recorded a net outflow of 184.3 billion. Ultimately, the overall balance of payments showed a 155.7 billion surplus.
The current account balance by sector recorded a surplus for agriculture (+680 billion), forestry (+249.7 billion), hydrocarbons (+1 078.5 billion) and transport (+99.8 billion). Conversely, it showed a deficit for industry (-1 835.2 billion), trade (-1 269.5 billion), telecommunications (-65.8 billion) and the financial sector (-3.5 billion).
According to major trading partners, trade ended with a current account deficit with China (-302.2 billion), Nigeria (-260.8 billion) and the European Union (-157.1 billion, including France, -165.1 billion). Conversely, the current account balance showed surplus with the United States (+53 billion) and CEMAC (+739.2 billion).
In the first half of 2020 and year-on-year, the trade deficit declined by 284.9 billion to stand at 487.4 billion. The deficit, excluding oil, dropped by 228.6 billion to reach 817.4 billion. This trend was the result of a lesser decline in exports (-86.3 billion) than in imports (-314.9 billion).
1.2.3. Currency and financing of the economy
In 2019, the economy was financed within a context marked by: (i) the continued implementation of the reforms initiated within the framework of the Economic and Financial Programme concluded with the IMF in June 2017; (ii) the application of new foreign trade regulations and new CEMAC regulations governing the activities of microfinance institutions. Compared with 2018, financing of the economy was characterized by an increase in money supply (+7.4%),
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reflecting a rise in its counterparts, namely net foreign assets (+14.4%), net claims on the State (+60.3%) and loans to the economy (+0.2%).
Concerning the monetary situation, net foreign assets rose by 14.4% to stand at 2 70.8 billion as at 31 December 2019 compared with 31 December 2018. This increase in assets was mainly generated by drawings from development partners within the framework of budget support and improved repatriation of export earnings.
Domestic credit stood at 4 168.5 billion, up by 7.4% compared with end-December 2018. This trend reflected the increase of 280.5 billion in net claims on the State and 5.9 billion in loans to the economy, to stand at 745.7 billion and 4 322.8 billion respectively in 2019.
Money supply rose by 7.4% compared with the end of December 2018 to stand at 5 416.4 billion, reflecting the change in its counterparts. By component, fiat money increased by 9.0%, scriptural money by 6.7% and quasi-money by 7.3%.
As at 30 June 2020 and year-on-year, money supply increased by 11.0% to reach 5 732.2 billion. This increase was due to the rise in net foreign assets (+5.5%) and domestic credit (+16.3%). On this date, money supply comprised 20.7% fiat money, 43.6% scriptural money and 35.7% quasi-money.
In the banking sector, net banking income (NBI) increased by 6.6% in 2019. The overall balance sheet of all banks rose by 9.5% to stand at 6 417.0 billion. Customer deposits totalled 4 870.0 billion, up by 9.6%, driven by the deposits of private enterprises, individuals and government services. Loans stood at 3 664.6 billion, up by 1.9%, thanks to an increase in loans granted to individuals and the central government services.
As at 30 June 2020 and year-on-year, deposits increased by 10.0% to stand at 5 146.8 billion, driven by private individuals and enterprises. Outstanding loans amounted to 3 682.3 billion, representing a 2.4% increase. However, credits to private enterprises (which account for 60.6% of credits) dropped by 1.1% due to the contraction in economic activity as a result of the pandemic. The level of financial intermediation (loans/deposits ratio) decreased to stand at 71.5%, as against 76.8% at end-June 2019. The same applies to the ratio of long-term loan deposits which dropped from 40.2% to 38.9%.
In the microfinance sector, there were 411 licensed microfinance institutions as at 31 December 2019, representing a decrease of 7 MFIs. This decrease is related to the continued streamlining of the sector, resulting in the closure of some MFIs. The 411 licensed MFIs are divided into categories as follows: 361 in the 1st category, 47 in the 2nd category and 3 in the 3rd category.
As at 31 December 2019, the total assets of MFIs amounted to 658.2 billion, down by 50.3 billion at end-December 2018 due to the contraction of CCPC’s balance sheet (- 32.3 billion) and the liquidation of COMECI (- 34.9 billion). Deposits collected by MFIs totalled 518.1 billion, up by 0.8% at end-December 2018. They comprised 84.5% demand deposits, 8.8% medium-term deposits and 6.7% long-term deposits. Loans granted by MFIs are estimated at 394.4 billion, that is a 2.4% increase.
There were 7 financial institutions at 31 December 2019. The total consolidated balance sheet of these institutions was 432.8 billion compared with 434.5 billion at end-December 2018. Loans
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and deposits amounted to 135.9 billion and 53.8 billion respectively, up by 5.4% and 10.3%.
Cameroon’s insurance sector continued to be dominated by 28 insurance companies, 17 of them in the “property and casualty insurance” branch and 11 in the “life and capitalization insurance” branch. In 2019, the sector’s turnover was 209.0 billion, compared with 207.2 billion in 2018, representing an increase of 1%.
1.2.4. Public finances
The State budget for the 2020 fiscal year is being implemented in a context marked, among other things, by: (i) the adoption of an amending finance law to take into account the negative effects of COVID-19 on budgetary revenue; (ii) the creation of a Special Appropriation Account (SAA) for the management of budgetary operations related to the COVID-19 response plan; (iii) Cameroon’s admission to the G20 countries’ Debt Service Suspension Initiative to help the poorest countries manage the impact of the COVID-19 pandemic; (iv) exceptional disbursements by development partners to support the financing of the COVID-19 Global Response Plan; and (v) the signature of an ordinance to raise the domestic debt ceiling in order to increase the issuance of government securities.
The Amending Finance Law reduced the initial budget by 542.7 billion to stand at 4 409 billion. In terms of resources, it includes 2 848.5 billion in domestic revenue and 1 560.5 billion in loans and grants. Expenditure is broken down into 2 241 billion in recurrent expenditure, excluding interest on debt, 1 254.3 billion in public investment expenditure and 913.9 billion for the servicing of public debt.
At the end of the first half of 2020 and relative to the Amending Finance Law, the resources mobilization rate was 57%, of which 53.1% for domestic revenue and 64.1% for loans and grants. The budgetary expenditure execution rate stood at 48%, of which 52% for current expenditure, excluding interest, 33.6% for capital expenditure and 44.7% for debt service. The deficit of the primary balance (based on payment authorizations) was 243.5 billion and that of the non-oil primary balance 440.6 billion.
Domestic budgetary revenue collected amounted to 1 512.9 billion, representing an execution rate of 53.1% compared with the year’s forecasts. It was broken down into 197.1 billion from oil revenue and 1 315.8 billion from non-oil revenue. When compared with the performance of the first half of 2019, domestic budgetary revenue dropped by 6.1% due mainly to the decline in oil revenue.
The amount of loans and grants provided for by the Amending Finance Law for the 2020 fiscal year stood at 967.0 billion, including 439.1 billion for issuance of government securities and 75 billion as bank loans.
Cumulative budgetary expenditure based on payment authorizations is estimated at 2 335.5 billion, representing an execution rate of 53% with respect to the Amending Finance Law. It includes 551.7 billion in personnel costs, 356.7 billion in expenditure on goods and services, 291.8 billion in transfers and subsidies, 424.9 billion in public investment expenditure and 627 billion in public debt service, including 425.4 billion in domestic debt.
Total budgetary resources at the end of the 2020 fiscal year are estimated at 4 813.3 billion,
8 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW up by 106.3 billion compared with the Amending Finance Law. They are estimated at 2 954.8 billion in domestic budgetary revenue, including 2 626.5 billion in non-oil revenue, and 1 858.5 billion in loans and grants. Cumulative budgetary expenditure based on payment authorizations is estimated at 4 707 billion at the end of December 2020.
1.2.5. Social sectors
Cameroon’s objective in terms of social development is to strengthen human capital. The actions carried out to this end continued to be geared towards: (i) ensuring universal education and strengthening professionalization; (ii) improving the health of the population; (iii) promoting gender equality and empowering women; (iv) providing social protection for vulnerable people; (v) promoting youth employment; and (vi) developing social housing.
To this end, a total of 1 184.2 billion was allocated to the social sectors in 2019, including 672 billion for education and 206.7 billion for health, representing an increase of 17.4% compared with 2018. This amount, which represents 22.7% of the State budget, was supplemented by multifaceted support from development partners assisting the Government in implementing its social policy. In 2020, the budgetary allocation was 1 219.8 billion, representing an increase of 35.7 billion. This amount included additional resources such as: (i) 58.7 billion for the strengthening of the health system under the special appropriation account to address the COVID-19 pandemic; (ii) 16 billion under the social safety net programme.
The Government’s actions in the educational sector mainly consisted in continuing activities to: (i) increase access to education by building and rehabilitating school and university infrastructure, equipping classrooms and workshops and training teachers; (ii) professionalizing and improving the quality of teaching; and (iii) promoting research and development.
At the end of the 2019/2020 academic year, the results of examinations organized by MINEDUB showed a success rate of 76.6% in the Certificat d’Etudes Primaires (CEP), down by 1.2 point compared with the 2018/2019 academic year. On the other hand, the success rate in the First School Leaving Certificate improved by 5.7 points to stand at 92.5%.
Concerning secondary education, the success rate in all examinations organized during the 2020 session by the Office du Baccalauréat dropped, except the industrial professional certificate which improved by 18.5 points to reach 83.6%. The success rate by examination is as follows: 47.2% in the Baccalauréat de l’enseignement secondaire général, as against 60.5% the previous year; 31.2% in the probatoire de l’enseignement secondaire général, representing a decrease of 12.6 points; 56.7% in the Baccalauréat des sciences et technologie du tertiaire (STT), which dropped by 6.8 points; 39.4% in the probatoire STT, as against 58.2% in 2019; 56.7% in the Bac EST compared with 63.5% the previous year, and 36.7% in the Brevet de technicien STT which dropped by 34.2 points.
Regarding the examinations organized by the GCE Board, the success rate for the GCE-General Ordinary Level improved by 7.4 points to stand at 69.6%. The success rate at the GCE-General Advanced Level dropped from 78.4% to 64.1% in 2020.
Concerning the competitive entrance and certification examinations organized by the Department of Examinations (DECC), the success rate in the BEPC ordinaire was 60.9%, showing a decrease
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of 11.3 points compared with 2019. The success rate in the bilingual BEPC was 83.6% compared with 90.4%, while that in the CAP STT dropped by 12.9 points to stand at 46.7%.
The Government’s actions in the health sector in 2019 focused on: (i) maternal, child and adolescent health; and (ii) disease control and health promotion. Concerning mother and child health, the Government continued to build and equip health facilities, particularly maternity wards, build the capacity of healthcare personnel and provide immunization coverage for mothers and children, mainly through the Expanded Programme on Immunization (EPI). The main actions concerning disease control and health promotion focused on diagnosis and patient care, mainly for malaria, tuberculosis, AIDS, cancer, leprosy, onchocerciasis and cholera.
The year 2020 was marked by the emergence of the COVID-19 pandemic in Cameroon, following its outbreak in China at the end of 2019, and its rapid spread worldwide. To address this situation, the Government took a series of measures including: (i) adapting the technical facilities of several reference hospitals to provide free care for people affected by the disease; (ii) the setting up of specialized centres for the care of the sick; and (iii) the procurement and distribution of equipment to limit the spread of the virus.
Regarding employment and social security, the Government’s objectives remained focussed on the promotion of employment, the development of vocational training and the promotion of labour protection and social security. In 2019, according to estimates by the Ministry of Employment and Vocational Training (MINEFOP), 511 857 new jobs were created, reflecting an increase of 11.4% compared with 2018. The number of jobs created in the private sector accounted for 75.2% of new jobs and increased by 4.6% to stand at 384 942 in 2019. Out of this number, 42 500 jobs were created through employment sector institutions (PIASI and NEF), as against 48 820 in 2018. In the public sector, 126 915 jobs were created through ministries and administrative public establishments, compared with 91 469 in 2018. The number of employees on the payroll was 319 110, compared with 321 917 in 2018. This decrease is due to the streamlining of the payroll through the State Employees Head Count (COPPE) operation launched by the Government in 2018. COPPE made it possible to eliminate from the salary card index, among other things, duplicate names, as well as persons unduly benefiting from reversionary pension, invalidity pension and temporary orphan’s pension.
Regarding town planning and housing, the Government’s policy continued to focus on: (i) housing development; (ii) the sanitization of the urban environment; and (iii) the development of urban transport infrastructure.
The actions implemented to promote housing development mainly concerned the completion of the construction of 40 social housing units in Olembé (Yaoundé), bringing the total number of completed units to 460 out of the 1 675 envisaged under the first phase of the Government’s Programme to Construct 10 000 Social Housing Units. In addition, under PLANUT, 500 social housing units and related infrastructure were completed and accepted at the rate of 100 units in each of the towns of Garoua, Maroua, Ngaoundéré, Bafoussam and Bertoua. This brings the number of social housing units built under PLANUT to 600, taking into account the 100 social housing units completed and accepted at Ebolowa in 2018.
Efforts to improve the environment and sanitize the urban environment were pursued in 2019, particularly through: (i) the construction of 100.4 kilometres of drains out of the 120.4 kilometres
10 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW envisaged within the framework of rainwater, wastewater and solid waste management; (ii) the continuation of works on the Douala rainwater drainage system whose execution rate increased from 57.5% in 2018 to 98% in 2019 over a distance of 42 kilometres; (iv) the development of 27 093 square metres of green spaces and the installation of 601 public lighting points in 10 localities in the country; and (v) the training of 485 young people in small-scale urban trades (production and laying of paving stones) in 7 councils and building the capacity of 638 employees in 140 councils.
Similarly, actions aimed at improving urban mobility were pursued, notably with the maintenance of 76.50 kilometres of urban roads out of the 127 507 kilometres planned, the rehabilitation of 14.49 kilometres of paved urban roads, including 10.64 kilometres in Yaoundé, and the rehabilitation and construction of urban roads, including 6.9 kilometres of access roads to the Olembé Stadium.
The main actions regarding social protection and prevention focused mainly on: (i) the rehabilitation of six buildings in the Pavillon des Brebis in the Centre Region; (ii) the securement of 13 abandoned children in orphanages; (iii) the provision of psychosocial care for 632 disabled persons suffering from certain diseases and 34 005 refugee children; (iv) the provision of psychosocial support for 10 405 internally displaced children, 8 005 socially vulnerable people and victims of the Ngouatche disaster.
The activities carried out to promote the family and protect the rights of the child included the following: (i) provision of assistance to 3 326 displaced families; (ii) training of 2 176 widows in setting up projects and creating income-generating activities; (iii) support for the collective celebration of 2 507 marriages; (iv) the issuance of 2 436 birth certificates; (v) the training of 170 adolescent group leaders to better prevent violence, child marriages and risk behaviour; and (vi) the granting of aid and relief to 2 938 needy and poor families to the tune of 132 million.
Concerning the economic promotion of young people, in 2019 the Government ensured the economic integration of young people, particularly through: (i) the strengthening of skills, supervision and support of 91 298 young people, bringing the number of young people trained in Multi-functional Youth Promotion Centres (MFYPCs) to 141 321, with 8 637 of them integrated into the economic fabric; (ii) support for the creation of 2 770 enterprises by young promoters; and (iii) the continuation of construction works on nine MFYPCs.
Regarding the fight against poverty, the activities of the “social safety net” programme continued in 2019 through ordinary cash transfers (OCTs) and labour-intensive public works (HIMO). Thus, the OCT programme helped to transfer 2.8 billion to 19 500 households. The HIMO programme enabled the implementation of 27 micro-projects in Bénoué Division, 14 of them in Bashéo and 13 in Dembo. The sum of 234 million was transferred to the 3 000 employees who took part in these works. During the 2019-2022 period, the “social safety net” programme plans to provide support to 276 000 selected households throughout the country for transfers amounting to 55.9 billion, of which 28.8 billion through the OCT programme, 20.9 billion through the emergency cash transfer (EMT) programme and 6.3 billion through the HIMO programme.
1.2.6. Structural and institutional reforms
To improve its macroeconomic framework and lay the foundations for strong and sustainable
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growth, in line with its development strategy, Cameroon continued to implement structural and institutional reforms. These reforms are in line with the implementation of: (i) Programmes with the IMF (Economic and Financial Programme – EFP), as well as other technical and financial partners such as the African Development Bank (AfDB), the World Bank (WB), the European Union (EU), and the French Development Agency (AFD); (ii) the Global Public Finances Management Reform Plan (GPFMRP); and (iii) increased economic performance in various domains.
The EFP was reviewed twice in 2019 (fourth and fifth), all of which were deemed conclusive. This led to the disbursement of 76.2 million dollars and 76.1 million dollars under the Extended Credit Facility (ECF). In 2019, 14 structural benchmarks were targeted.
At end-September 2020, eight of these benchmarks had been achieved. They are: (i) disclosure of the nature and volume of contingent liabilities in an annex to the Finance Law; (ii) the authorization of competitive bidding for procurement of LPG, the validation of the required compensation for LPG fuel in commission and the regular transfer of cash surpluses from the HPSF to the Treasury; (iii) the setting up of a mechanism to identify the nature and reconcile the data of the direct activities of the NHC to ensure their monthly regularization, in accordance with the various types of expenditure; (iv) the preparation of a disbursement plan for committed and undisbursed balances in line with the macro-budgetary objectives of the programme, after consultation with development partners; (v) the closing of all the accounts of non-revenue- generating entities (mainly government services such as line ministries and public bodies) and discontinuation of the transfer of new budgetary appropriations to such accounts; (vi) the finalization of the implementation of the Single Treasury Account ( STA) by closing all public accounts eligible for the STA in commercial banks, and consolidating those of the Treasury and BEAC; (vii) quarterly payment of utility bills (ENEO, CAMWATER, CAMTEL and SONARA) based on annual budgetary allocations; and (viii) training of judges serving in chambers of commerce in major business centres in the resolution of bank-related disputes.
Five of the ten structural benchmarks expected in 2020 have been fully achieved. These are reforms aimed at: (i) expanding the single treasury account; (ii) revising and simplifying the existing fuel price structure; (iii) finalizing the database of personal property security interests by capturing all personal property security interests held by banks; (iv) defining a business model for the SME bank; and (v) in consultation with COBAC and the IMF, adopting plans to rescue the two distressed banks which minimize fiscal costs.
Programmes implemented with other TFPs have made it possible to implement reforms in order to: (i) improve budget sustainability and the management framework of public finances; (ii) enhance governance and the competitiveness of the productive sectors; (iii) strengthen the strategic planning and public investment expenditure management framework; (iv) strengthen the regulatory and institutional framework for the management of the agro-pastoral sector; (v) improve social services and social protection. The implementation of these reforms, which is considered satisfactory, enabled Cameroon to benefit from substantial support provided by the AfDB in 2019 worth 80.4 million euros within the framework of the Competitiveness and Economic Growth Support Programme (CEGSP); 35 million euros by the European Union within the framework of the Sector Reform Contract; 100 million euros by the French Development Agency (AFD) in the form of a Budgetary Support Loan (BSL). In addition, within the framework of the Development Policy Support Programme (DPO) concluded with
12 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW the World Bank as well as the satisfactory implementation of the reforms envisaged in 2019, the third tranche totalling 100 million dollars should be disbursed in 2020.
For its part, the main objective of the Global Public Finance Management Reform Plan (GPFMRP) is to modernize the public finance management system. It is geared towards reconciling public finance management standards and best practices. It seeks to: (i) gradually reduce performance gaps with respect to international standards; and (ii) implement the provisions of the laws and regulations transposing CEMAC directives. This plan focuses on five thrusts: (i) building capacity in budget preparation and improving programme-based budgeting; (ii) strengthening fiscal citizenship and capacity to mobilize budgetary resources; (iii) building capacity to monitor and control budget execution; (iv) the development of internal audits and controls; and (v) the establishment and strengthening of PFM support functions.
At end-2019, 33 out of the 223 measures included in the 2019 Annual Operational Plan were successfully implemented. The main reforms implemented under this plan include:
- the signing of the decree to fix the State budgetary calendar; - the adoption of the new templates of the initial Finance Law and the Settlement Law; - the operationalization of the new Cameroon Customs Information System (CAMCIS) to replace the ASYCUDA system; - the continuation of the process of closing public accounts (government services and public establishments) in commercial banks in favour of the Single Treasury Account (STA); - the reorganization of the public procurement control system based on the new Public Cotracts Code; - the regular publication of information on the preparation and execution of the Finance Law through instruments such as websites and the print media; - the signing of the decree on the General Public Accounting Rules and Regulations.
The Government continued to implement other reforms concurrently with the EFP and the GPFMRP, particularly in the areas of electricity, health and public enterprises management and the improvement of the business climate in order to enhance the performance of its economy.
In the electricity sector, the President of the Republic signed a decree on 19 August 2020 to lay down the creation, organization and functioning of the Electricity Sector Development Fund (ESDF). The presidential decree specifies that it is a “special appropriation account for the financing of the electricity sector”. The ESDF’s resources shall be derived from: (i) a levy of 1% on the annual turnover, excluding taxes, of operators holding concessions, licences or other authorizations; (ii) a share of the water rights paid to EDC; (iii) State budgetary resources; (iv) a share of the dividends paid by the State as part of its shareholding in electricity sector enterprises; and (v) a share of the operators’ entry or renewal fees.
Furthermore, on 7 September 2020, the Minister of Water Resources and Energy signed a water storage concession agreement with the Electricity Development Corporation (EDC) for the generation of electricity in Cameroon. This agreement grants EDC exclusive rights over the management of water storage facilities and the regulation of stored water. The concession agreement henceforth authorizes the EDC to collect water royalties from ENEO and future operators established in the Sanaga basin, as provided for by the 14 December 2011 Law.
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In the health sector, on 17 June 2020, the Prime Minister announced the beneficiary of the public-private partnership contract for the “Financing Project to Design, Build, Operate, Equip and Maintain the Management System for Universal Health Coverage in Cameroon”. The company is “NewTech Management Cameroon”. The aim of the “Universal Health Coverage” project is to guarantee equitable access to quality health care to all Cameroonians based on a determined health care package.
On a more global level, following the outbreak of COVID-19, the Government adopted and published Cameroon’s strategy for responding to the pandemic and for economic and social resilience. The document outlines the Cameroon Government’s response to the health crisis induced by the COVID-19 pandemic.
In the telecommunications sector, the restructuring of the Cameroon Telecommunications Corporation (CAMTEL) was pursued in order to make it more competitive. Within this framework, the State, which is the sole shareholder of the company, granted it three concession agreements for fixed telephony, mobile telephony and transmission on 12 March 2020.
On a different front, it is worth noting that on 20 July 2020, Parliament adopted LawNo. 2020/10 to regulate statistical activity in Cameroon. This law lays down the basic principles for the production of official statistics, the ethical rules and institutional framework for the production of statistics and the conditions for coordinating such production. 1.3. Macroeconomic and Budgetary Outlook for the 2020-2023 period Although economic activity contracted in 2020 due to the adverse effects of the pandemic, it is expected to return gradually to normal from 2021. However, this macroeconomic outlook will be marked by many uncertainties, notably on: (i) the scope and duration of the pandemic; (ii) the trends in commodity prices and global demand; and (iii) the efficacy of government initiatives to preserve jobs and revive economic activity.
1.3.1. Macroeconomic situation during the 2020-2023 period In 2020, economic activity is expected to contract by 2.6% (-2.6%) for the first time in 30 years. This decline, which is linked to the negative consequences of the COVID-19 pandemic, is noticeable mainly in the “hydrocarbons” (-3.7%), “industrial export agriculture”, “forestry and logging”, “livestock and hunting”, “restaurants and hotels”, “transport” and “trade” branches. However, the “information and telecommunications” branch is expected to continue to be vibrant, capitalizing on the situation with the significant increase in the consumption of NICT by enterprises and households
The main component of demand, that is domestic demand, is expected to decline due to the drop in household consumption and business investment. Household consumption is expected to decline by 6.5%, reflecting the fall in household spending on manufactured goods, particularly clothing and equipment, as well as transport, catering and leisure. Conversely, general government consumption is expected to increase by 0.4%, driven by the rise in operating expenditure and social services.
Against the backdrop of high uncertainty and a decline in activity, investment is expected to contract by 1.9% in 2020 compared with an increase of 8.1% in 2019. This trend would stem mainly from
14 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW the combined decline in private and public investment. Business investment is expected to shrink by 1.8%. In the face of a steady decline in demand and cash flow constraints, enterprises will be obliged to forego or postpone expenditure deemed non-essential in the short term.
External demand for the country’s exports is expected to decline due to the slowdown in activity observed in our major partners. The health crisis and containment have had a very significant impact on external trade. According to figures from customs services, exports and imports of goods other than crude oil fell by 12.8% and 18.3% respectively during the first half of 2020 compared with the same period in 2019. Consequently, export volumes are expected to fall by 3.1% compared with a 5% increase in 2019. Imports, for their part, are expected to decline by 0.8%, impacted by the decline in the purchase of capital goods, energy products, consumer goods, raw materials and semi-finished products.
In 2020, the other aspects of the economy are expected to record: (i) a 2.5% inflation rate resulting from the difficulties encountered in the supply of foodstuffs, coupled with a decline in supply; (ii) an overall budget deficit of 4.5% of GDP in 2020 due to a drop in revenue and an increase in expenditure related to the Covid-19 pandemic response mechanism; and (iii) a balance of payments current account deficit of 6.11% of GDP as a result of a sharper drop in imports than in exports.
With regard to external transaction accounts, the current account deficit is expected to increase by 1.8 point to -6.1% of GDP, reflecting a sharper decline in exports with respect to imports.
1.3.2. Macroeconomic Outlook for 2021-2023 Based on the assumption of a gradual return to normalcy and better sensitivity of the initiatives mentioned above, Cameroon’s economy is expected to return to the path of growth in 2021 and reach its pre-crisis level by 2023. The economic policy objective during the said period is to put the country back on the path of emergence by mitigating the harmful effects of the COVID-19 pandemic. Government’s actions will aim to continue the structural transformation of the economy and will focus mainly on the recovery policy, the modernization and industrialization of agriculture. To this end, emphasis will be placed on the development of growth and employment-generating strategic sectors, particularly those that are at the root of the balance of trade deficit.
Thus, the Government’s economic policy over this period should be based on a structural pillar and a cyclical pillar. Structurally, this involves implementing the first three years of Cameroon’s National Development Strategy (NDS). The second pillar concerns the concurrent implementation of two plans, namely an Economic Recovery Plan within the framework of the national economic recovery policy and a Consumer Goods Production and Processing Support Plan within the framework of efforts to strengthen its economic sovereignty in order to enhance endogenous growth.
In 2021, GDP is expected to increase by 3.4%, but remain below its 2019 level. During the 2021-2023 period, the average growth rate is projected at 4%. This growth would continue to be supported by robust domestic demand, especially household consumption and investment.
Regarding external accounts, projections assume a reduction in the current account deficit to an average of 3% during the 2021-2023 period. To this end, emphasis should be placed on the
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diversification of exports, the processing of primary products (cocoa, wood, coffee, etc.), the competitiveness of the national economy and the gradual reduction of imports by improving the local supply of products of mass consumption (rice, fish, textiles, petroleum products, etc.).
Concerning public finances, the aim will be to gradually reduce the overall budgetary deficit to a sustainable level. This reduction will be achieved by improving the mobilization of non- oil revenue, strengthening budgetary discipline as well as ensuring better control of public expenditure.
1.3.3. 2021-2023 Budget outlook The objective of reducing the budget deficit is broken down into specific revenue and expenditure targets. Concerning revenue, the objective remains the optimum mobilization of domestic non- oil revenue, while maintaining an incentive policy at the economic level and a protective policy at the social level. Regarding expenditure, efforts will have to be made to improve the efficacy and efficiency of public spending. In addition, specific actions should be envisaged in order to enable not only the implementation of the National Development Strategy and the post- COVID Recovery Plan, but also to: (i) support the COVID-19 health response; (ii) enable the implementation of the Plan for the Reconstruction of the North-West and South-West Regions; (iii) strengthen the decentralization process; (iv) encourage the hosting of major international sports events (organization of CHAN and AFCON); and (v) ensure the introduction of universal health coverage.
Revenue projections for 2021 are based on: (i) a projected production of 24.8 million barrels of oil and 82 billion scf of gas; (ii) a projected Brent crude oil price of 43.8 dollars, from which a discount of 3.5 dollars will be made, that is, a Cameroonian barrel price of 40.3 dollars; a gas price of 4.4 dollars; (iii) an exchange rate of 579.8 CFA francs per dollar; and (iv) a nominal non-oil GDP growth rate of 5% on which the growth of non-oil revenue is based. In light of the foregoing, the 2021 draft budget is balanced in revenue and expenditure at the sum of 4 865.2 billion, up by 158.2 billion compared with estimates at end-2020 and 232.5 billion compared with the Amending Finance Law for the 2020 fiscal year.
1.3.4. Budgetary constraints and risks for 2021 The budgetary forecasts made under the 2021Finance Bill remain subject to various constraints and risks that could upset the resulting budgetary and financial balance. The risks relate to the assumptions underlying the macroeconomic projections, revenues, particularly oil revenues, expenditure and financing.
From a macroeconomic point of view, a stalemate resulting from the coronavirus pandemic in 2021 or the limited effectiveness of Government policies to mitigate the economic effects of the crisis on enterprises could lead to a level of activity lower than that projected and, consequently, to a lower level of tax and customs revenue than expected. Furthermore, the volatile world oil price represents a risk for the 2021 budget if this price were to fall below 43.8 dollars per barrel, which is the forecast assumption.
Besides, failure to conclude a new economic and financial programme with the IMF in 2021 could affect the financial balance of the finance law, thus creating a major financing gap. The same applies to the failure to mobilize all government securities amounting to 350 billion in
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2021. If financial conditions are unfavourable on the securities market or in case of a liquidity problem, the financial balance of the 2021 budgetary framework would be weakened.
The on-going security risk continues to weigh on State spending, particularly through direct NHC interventions, the level of which is still high. Similarly, the cost of health spending in the fight against the coronavirus could disrupt the 2021 budgetary balance, should the health crisis spill over into 2021.
The overlapping of reforms and programmes in the political agenda leads to more and more important commitments that bring about a high degree of budgetary rigidity. These include the concurrent implementation of the response plan against COVID-19 and its impacts, the plan to revive local production of mass consumption products, which is the cause of the trade balance deficit, the reconstruction plan of the North-West and South-West regions, decentralization, PLANUT, Special-Youths Three-year Plan, CHAN, AFCON, major infrastructure projects and Universal Health Coverage (UHC). All these commitments constitute a major budgetary risk in the event of a public finance shock, insofar as they would limit the effective deployment of regulatory measures in execution as well as the reallocation of resources between the various budgetary items or their adjustment.
Insufficient consideration of the need to clear the stocks of Treasury outstanding payments, floating debts and the debt of correspondents and depositors, constitutes a risk to the financial balance of the 2021 Finance Law, in the event that the payment of such financial obligations exceeds the modest provision of 70 billion set aside for that purpose.
Lastly, the deterioration in the financial situation of some public and semi-public sector enterprises could continue to require significant financial support from the State budget. All this would lead to a removal of the ceiling on the level of expenditure projected for 2021. This risk is compounded by the risk of calls for public guarantees on the debt of these entities. It should be noted that the outstanding debt endorsed by the State is estimated at 34.2 billion CFA francs as at the end of September 2020 (0.2% of GDP).
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CHAPTER 2: PRODUCTION In 2019, Cameroon’s economy was, among other things, marked by: (i) the good performance of hydrocarbons extractive activities; (ii) lingering security crises; and (iii) the SONARA fire incident. Economic growth slowed to 3.7% from 4.1% in 2018. The tertiary sector contributed 1.6 points to real GDP growth, the secondary sector 1.3 points and the primary sector 0.4 point. Taxes and duties contributed 0.4 point to growth. 2.1. Primary Sector In 2019, primary sector GDP dropped to 2.8% from 5.1% in 2018. This trend is related to the decline in activities in the “Forestry and logging” branch, and to the slowdown in “Food crop farming”. The primary sector accounted for 14.5% of GDP.
Government’s policy in the sector continued to focus on the development of value chains in the agro-sylvo-pastoral and fisheries sub-sectors. It resulted in the implementation of several actions, namely: (i) the improvement of production techniques; (ii) the modernization of infrastructure; (iii) the supervision and training of producers; (iv) the sustainable management of forest resources; and (v) research and innovation.
2.1.1. Agriculture
This sub-sector comprises industrial and export agriculture, and food crop farming.
2.1.1.1. Industrial and export agriculture Activity in the “industrial and export agriculture” branch recorded a 4.6% increase in value added, that is a 0.7 point improvement compared with 2018. This trend is the result of the increase in cocoa and cotton production.
Cocoa In 2019, cocoa production increased by 4.3% to 322 937 tonnes, despite the disruptions observed in the South-West Region. The other basins are experiencing an increase in production. Thirty- two point five per cent (32.5%) of production was transformed locally, while the remaining 67.5% was exported.
The actions carried out to improve productivity and production mainly focused on: (i) the distribution of 2 189 439 certified cocoa seedlings; (ii) the certification of 1 129 000 seedlings from private nurserymen; (iii) the distribution of 12 180 litres of special cocoa fertilizers; (iv) the treatment of 20 500 hectares of cocoa plantations; (v) the creation of 160 ha of plantations; (vi) the distribution of 10 000 cocoa pods to nurserymen; and (vii) the procurement and distribution of 480 shelling machines to farmers.
Moreover, to ensure more effective Government support in the sector, Decision No. 26/MINADER/CAB of 17 February 2020 merged five ongoing projects into the “Cocoa Development Support Project”. The project comprises four components, namely: (i) Improvement of access to selected cocoa seedlings by producers; (ii) Development of modern plantations; (iii) Improvement of the quality of raw materials and development of processing and marketing; and (iv) Support for the structuring of producer organizations.
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Coffee In 2019, Arabica and Robusta coffee production respectively dropped by 6% and 5.8% to stand at 6 171 tonnes and 33 586 tonnes. The subsector is still plagued by the ageing of plantations and lack of manpower. Moreover, falling world market prices and the high cost of inputs also contribute to discouraging young producers from cultivating these crops. However, to address the difficulties faced in selling products due to falling world market prices, producers are increasingly opting for local coffee processing. Government’s actions to increase production included: (i) the distribution of 1 750 940 certified coffee seedlings; (ii) the distribution of 11 650 litres of special coffee fertilizers; and (iii) the rehabilitation and upkeep of 500 hectares of old plantations. Natural rubber In 2019, rubber production dropped by 21.7%, after improving by 8.2% in 2018, to stand at 35 517 tonnes. Security issues in production basins contributed to slowing down the collection of latex by the CDC and HEVECAM. To increase production, a partnership agreement was signed between the Sud Cameroun Hévéa (SUDCAM) agro-industrial company and the Government. The agreement provided for the development of rubber cultivation on 45 000 ha in the South Region, especially in the localities of Meyomessala, Meyomessi and Djoum. The entire 45 000 ha should be planted by 2027. Cotton In 2019, seed cotton and cotton fibre production increased by 8.5% and 22.4% to stand respectively at 320 077 and 131 761 tonnes. These trends are attributable to the drop in post- harvest losses and the upgrading of production equipment, among other things. SODECOTON continued to implement its investment plan. To that end, it was granted a 64.3 billion loan by the International Islamic Trade Finance Corporation, a subsidiary of the Islamic Development Bank (IsDB). Export banana In 2019, export banana production continued to experience a downtrend. After a 30.9% slump in 2018, it declined by 6.6% to stand at 224 537 tonnes. Such drop in production is related to unfavourable weather conditions, the poor state of roads for evacuating produce from plantations to loading points and financial difficulties faced by PHP, the leading operator in the subsector. Exports dropped by 15.1%. To support enterprises in the subsector, the 31.7 billion loan agreement signed between the Government and the European Union for a 7-year period, starting from 2012, was extended by 2 years. The extension is expected to help enterprises in the subsector to complete the implementation of their various investment plans. Crude palm oil In 2019, industrial crude palm oil production was virtually stable at 171 956 tonnes, compared with 2018, owing to unfavourable weather conditions. Insecurity in the South-West production basin also contributed to the stagnation. To increase production, investments carried out by enterprises in the branch focused on: (i) the expansion of plantations; (ii) the replacement of old plantations; (iii) the improvement of factory extraction rate with the upgrading of productive equipment; (iv) the acquisition of
20 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW short-cycle and high-yield plant materials; and (v) the stepping up of phytosanitary treatment and the use of fertilizers. To support operators in the segment concerned with the local processing of this crop, Government each year grants an authorization for VAT-free importation of crude palm oil at the CEMAC external tariff rate of 5%. In 2019, it concerned 90 000 tonnes of crude palm oil. Village production mainly intended for consumption stood at 233 090 tonnes, up by 3.3%, as against 13% in 2018. To increase village production, Government provided farmers with 43 500 pre-germinated nuts and 34 643 seedlings. Table 2: Agro-industrial Production, Exports and Prices
Item 2012 2013 2014 2015 2016* 2017* 2018* 2019** Cocoa Production (tonnes) 268 941 275 000 281 196 308 753 330 412 308 736 309 627 322 937 Exports (tonnes) 173 794 192 836 192 637 265 306 263 746 221 667 218 793 218 002 Prices (in CFAF/kg) 1 356 1 386 1 732 1 756 1 654 1 158 1 265 1 312 Arabica Coffee Production (tonnes) 10 000 7 000 8 020 6 504 7 024 10 307 6 565 6 171 Exports (tonnes) 5 148 2 228 2 434 2 004 1 943 1 730 1 146 859 Prices (in CFAF/kg) 2 748 2 070 2 975 2 227 2 188 2 131 2 001 1 820 Robusta Coffee Production (tonnes) 42 000 31 127 37 115 27 094 29 762 21 316 35 654 33 586 Exports (tonnes) 36 436 19 280 28 171 27 990 30 914 22 273 17 765 17 213 World Prices (in CFAF/kg) 1 622 1 483 1 553 1 391 1 361 1 492 1 254 1 085 Rubber Production (tonnes) 46 318 51 510 51 559 46 920 40 983 41 911 45 354 35 517 Exports (tonnes) 42 851 54 068 57 150 36 149 42 328 42 381 41 560 34 367 Prices (in CFAF/kg) 1 479 1 216 812 864 1 019 1 279 1 050 940 Seed Cotton Production (tonnes) 227 000 240 000 274 286 289 994 258 000 248 150 295 100 320 077 Cotton fibre Production (tonnes) 82 124 88 854 98 375 107 585 91 970 100 877 107 617 131 761 Exports (tonnes) 76 173 91 532 90 854 98 143 101 427 101 893 113 623 130 061 Prices (in CFAF/kg) 878 868 799 920 865 975 1 066 1 067 Export Banana Production (tonnes) 256 789 321 814 343 616 363 029 381 525 347 896 240 403 224 537 Exports (tonnes) 231 802 261 808 265 276 283 436 295 180 275 717 217 177 184 370 Prices (in CFAF/kg) 553 569 554 482 505 502 536 518 Palm Oil Industrial Production 99 238 113 940 127 321 140 212 130 129 155 066 171 955 171 956 (tonnes)
Sources: MINADER, MINFI/DP, WEO, * Updated data, ** Estimates
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2.1.1.2. Food crop cultivation In 2019, food crop cultivation added valued increased by 3.1%, as against 5.1% in 2018. This slowdown is mostly due to unfavourable weather conditions for many crops, and the security crises in the North-West, South-West and Far-North regions which are major production basins. Government’s actions in the sub-sector concerned the supervision and training of producers, and the popularization and distribution of high-yield seedlings and plant materials. The crops concerned included cereals, roots and tubers, legumes, market garden produce, fruits and vegetables. Cereals They are staples and mainly comprise maize, millet/sorghum and paddy rice. In 2019, poor weather conditions led to a drop in maize and millet/sorghum production. Maize Production dropped by 11.1% in 2019, as against a 5.6% increase in 2018, to stand at 2 012 183 tonnes. This drop is mostly attributable to unfavourable weather conditions at the start of the season, with late rains, and during harvest, with abundant rains and even floods. The actions undertaken through programmes and projects concerned: (i) the commissioning of 740 ha of farms for consumption maize production; and (ii) the procurement and distribution of 2 294 tonnes of basic seeds, 1 275 tonnes of certified seeds and 480 shelling machines. The obstacles to large-scale maize production included uncertain weather conditions, land- locked production basins, difficulties in accessing land and insufficient mechanization. Millet/Sorghum In 2019, millet/sorghum production declined by 3.7% compared with 2018 and stood at 1 228 208 tonnes. This trend is related to unfavourable weather conditions and insecurity in the Far-North production basin. To improve productivity, 238 tonnes of certified basic seeds were distributed to farmers. Paddy rice In 2019, paddy rice production increased by 0.9% to stand at 334 275 tonnes. To increase its production, SEMRY, the major company in the subsector, received a 3.3 billion support from Government to procure ploughing machines and electric power generators for the functioning of hulling units. Government’s actions focused on: (i) the distribution of 1 681 tonnes of certified rice seeds; (ii) the production of 80 tonnes of irrigated basic rice seeds; (iii) the development of 13 102 hectares of lowland; and (iv) the training of 400 farmers in rain-fed rice cultivation techniques. Roots and tubers In 2019, cassava and sweet potato production increased by 2.8% and 2.3% respectively. Producers were provided with 28 502 500 certified cuttings. The production of other roots and tubers dropped. By crop, the following results were recorded: (i) an 8.4% drop in Irish potato production, as against a 5.7% rise in 2018, owing to the late supply of certified seeds to producer organizations and the displacement of the population in crisis areas; (ii) yam and cocoayam/colocasia production maintained a downtrend with respective growth rates of -3.1% and -0.5% in 2019, against – 4.8% and -3.4% in 2018. Leguminous crops and oilseeds In 2019, the crops whose production remained on an uptrend included: groundnuts (+9.3%), cowpea (+6.3%) and soya beans (+6.7%). Concerning soya beans in particular, cultivated surface area witnessed an increase and farmers were trained in production techniques. The
22 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW production of other leguminous crops and oilseeds dropped by 10.2% for beans, 3.9% for sesame and 12.8% for voandzou, after experiencing an increase the previous year. Market garden produce, fruits and vegetables In 2019, plantain production stood at 4 524 989 tonnes, up by 1.5% compared with 2018. Plantain farmers were supplied with 2 380 550 suckers. In addition, 9 315 000 suckers were produced in seed farms. Concerning the other market garden crops, fruits and vegetables, production rose for tomato (+2%), watermelon (+5.7%), pineapple (+1.4%), onion (+2.0%) and pepper (+5.8%), as against a 6.5% drop for okra. Government’s actions mainly concerned: (i) the distribution of 36 400 fruit tree seedlings, 7 000 mango seedlings, 247 000 pear seedlings, 40 000 citrus seedlings and 150 000 eru seedlings; (ii) the creation of 10 tomato cultivation training farms in the East and West Regions; and (iii) the distribution of 251 sachets of hybrid watermelon seeds, 440 sachets of hybrid pepper seeds and 255 sachets of high-yield tomato seeds. Table 3: Production of Major Food Crops (in tonnes)
Items 2012 2013 2014 2015 2016 2017* 2018* 2019** Cereals Maze 1 749 976 1 948 019 2 062 952 2 070 572 2 101 631 2 142 641 2 263 400 2 012 183 Millet/Sorghum 1 425 895 1 638 377 1 735 040 1 040 902 1 144 992 1 066 495 1 275 674 1 228 208 Paddy rice 181 818 189 890 201 090 278 281 311 674 289 221 331 191 334 275 Leguminous crops Cowpea 171 955 179 000 186 000 199 000 195 408 200 113 196 961 209 386 Voandzou 35 199 36 639 40 000 46 000 27 864 29 387,90 33 363,60 29 087,00 Sesame 50 802 51 496 54 000 56 000 68 422 37 745 37 961 36 463 Groundnut 643 222 666 947 729 000 781 000 622 732 597 658 636 497 695 729 Soya beans 14 908 12 241 16 000 17 000 24 558 20 544 146 606 156 439 Beans 417 768 438 000 473 000 506 000 390 816 379 926 384 515 345 344 Items 2012 2013 2014 2015 2016 2017* 2018* 2019** Roots and tubers Cassava 4 287 177 4 501 671 4 600 707 5 224 735 5 284 683 5 617 376 5 499 306 5 654 517 Cocoayams/ 1 614 103 1 660 710 1 697 245 1 757 249 1 801 180 1 858 116 1 794 810 1 785 860 colocasa Yams 537 802 559 366 571 672 602 228 618 136 567 774 540 456 523 696 Sweet potato 327 126 347 490 355 135 391 905 426 899 391 199 460 697 471 086 Irish potato 210 015 224 246 224 562 346 332 384 429 373 418 394 540 361 432 Market garden crops, fruits and vegetables Tomato 889 795 954 384 965 000 1 000 000 1 182 114 1 125 020 1 094 714 1 116 327 Onion 198 024 212 000 226 000 240 000 303 781 300 843.30 311 295.60 318 659.70 Pepper 37 307 41 548 40 000 43 000 58 903 51 078.00 55 472.00 58 711.30 Plantain 3 569 318 3 718 895 3 834 180 4 477 344 4 280 305 4 352 787 4 457 513 4 524 989 Okra 69 060 72 661 77 000 78 000 80 780 83 851.80 99 292.40 92 877.30 Watermelon 50 108 69 587 70 907 73 793 76 745 75 463 72 869 77 014 Pineapple 167 853 170 269 282 334 296 047 214 106 225 002 241 090 244 508 Cucumber 16 175 6 993 10 457 Ginger 4 110 3 693 3 398 Source: MINADER, * = Updated data, **= Estimates
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Rural sector development support measures In the rural sector, the Government implemented many cross-cutting actions, namely: (i) the rehabilitation of 168 kilometres of farm-to-market roads and the creation of 202 kilometres of farm-to-market roads; (ii) the levelling of plots damaged by grazing activities in the North- West Region; (iii) the procurement of shelling machines, hulling machines and mats for the construction and supply of driers to farmers; (iv) the equipping of youths with light farming equipment kits (wheelbarrows, sprayers, overalls, etc.); (v) a 2.4 billion financial support to 590 producer organizations; (vi) the construction of 191 water points and boreholes, 36 community buildings and markets sheds; (vii) the training of actors in fertilizer and soil analysis, and production techniques; and (viii) the creation of a soya bean seed production training farm in Figuil.
Prospects of the agriculture subsector The need to increase the quality and quantity of production of each food or export crop will remain unchanged. As part of actions to broaden the range of agricultural products, the Government prioritized the development and popularization of cashew cultivation. To that end, IRAD distributed 1.1 million cashew seedlings in 2020.
Concerning food crop cultivation, the Government signed a 28 billion financing agreement with the FAO at end-September 2020 for the production of onions and rice, the latter crop being Cameroon’s leading import product. Considering that it is a mass consumption product, the authorities want to increase local production to meet demand in the medium term. Special attention will also be paid to rice within the framework of the management of the fund relating to local and made in Cameroon products that is being set up.
2.1.2. Livestock breeding, fishing and fish farming
2.1.2.1. Stockbreeding hunting
In 2019, livestock breeding activities maintained an uptrend, with a 5.5% growth rate, as against 4.4% in 2018. This trend was sustained by the production of live animals, including cattle, pigs and poultry. However, the production of most species of meat dropped owing to the strike action by truck drivers which affected the North-South corridor, leading to a shortage of live animals in the markets in major consumption centres.
Cattle In 2019, the cattle herd increased to 9 506 103 heads, recording an 8.5% increase, compared with 2018. The increase is the result of: (i) the increase in the supply of high-yield animal species; (ii) the supervision of producers and the financing of their projects through livestock breeding programmes and projects (ACEFA, PRODEL, LIFIDEP, PEA-Jeunes, etc.); (iii) the improvement of the availability of water and fodder crops in the main production basins; and (iv) the continued modernization of livestock breeding infrastructure. Beef production stood at 107 110 tonnes, down by 24.8% compared with the previous year.
Specifically, Government’s actions in the subsector concerned: (i) the creation of 8 cattle farms; (ii) the establishment of 41 animal product processing, storage and distribution units (Martap, Bafia, Nkoudoula, Yoko, etc.); (iii) the construction of 12 calve parks and 16 night parks at
24 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW the Wakwa Station (4) and at SODEPA (12), 1 pastoral water pond at Kar Hay and 1 cattle market (Phase I) at Guéreté; (iv) the rehabilitation of 9 animal treatment parks; (v) the artificial insemination of 1 270 cows, 110 of them at the Wakwa Station and 1 160 by the Livestock Development Project (PRODEL); (vi) the upkeep of 7 ha of braccharia fodder crop farms and the development of 513 ha of pasture land, and 3 ha of seed farms; (vii) the reproduction of 7 305 matrices at SODEPA; (viii) the supply of 292 artificial insemination calves to stockbreeders; and (ix) the immunization of 1 940 827 cattle heads against major diseases.
The other actions carried out through MINEPIA bodies and programmes concerned: (i) the acquisition of 30 improved breed bulls and the training of 10 385 producers in improved fodder production techniques; (ii) the production of 7.5 tonnes of cattle feed supplements and 160 blocks of lick stone; (iii) the construction of 6 solar-powered boreholes to supply two drinking troughs each in the localities of Akmassirak, Wouro-Kessoum, Djendjerengue, Djalingo, Mandari and Tchabawol, as well as the rehabilitation of a borehole at Dogba; and (iv) the upkeep of 109 fodder farms.
Porcins In 2019, the pig population stood at 3 848 437 animals, up by 3.2% compared with 2018. This trend is the result of the popularization of production techniques and support to subsector players for efficient management. The quantity of pork produced was 42 833 tonnes, down by 18.5% compared with 2018.
The activities carried out to support the pig subsector included: (i) the creation of 33 pig farms and the production of 26 tonnes of compound feed; (ii) the dissemination of 146 improved naima brood stock, including 71 female and 75 male, to producer organizations by the Kounden station; (iii) support to 8 796 producer organizations and informal groups representing 129 455 producers; (iv) the financing of 69 projects for the construction of pig rearing buildings and 5 feed production equipment/infrastructure projects; and (v) the upkeep of 12 ha of maize farms for the production of complete feed.
Small ruminants In 2019, the sheep herd increased by 3%, compared with 2018, to stand at 3 604 931 animals, while that of goats rose by 1% and stood at 6 571 397 heads. Mutton production stood at 18 197 tonnes, up by 18.7%. In contrast, goat meat production declined by 1.4% to stand at 25 081 tonnes. The increase in the small ruminant population is attributable to: (i) improved herd health coverage through the organization of immunization campaigns against small ruminant pest; (ii) the increase in the number of subsector players in order to sell animals on sub-regional markets; and (iii) a rise in demand, related to the increase in mutton and goat meat rotisserie activities. The activities carried out to encourage subsector operators focused on: (i) the granting of authorizations for the creation of 2 sheep and goat farms; (ii) the importation of 44 improved breed small ruminant brood stock, of which 22 billy goats and 22 sheep, the training of 484 producers in small ruminant multiplication; (iii) the immunization of 5 000 000 small ruminants against pest; and (iv) the upgrading of LANAVET’s technical equipment and its accreditation to the ISO17025 standard on the diagnosis of animal diseases.
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Poultry In 2019, the bird population rose by 2% and stood at 85 579 493 chicken. This growth was the result of the drop in bird disease outbreaks and the acquisition of incubators and poultry transportation cages for women and young poultry farmers.
The activities implemented as part of the development of the poultry subsector included: (i) the creation of 81 poultry farms and 46 establishments for the manufacture and sale of complete feed ; (ii) the production of 20 tonnes of complete poultry feed ; (iii) the acquisition and distribution of 72 323 day-old chicks to 167 producers, and 6 000 day-old chicks for the Bali Station in the North-West Region ; and (iv) the equipping of 61 poultry buildings and 11 feed mills.
Table 4: Trends in Livestock Population and Quantity of Slaughter Meat
2017 2018 2019 Variations in % Item Herd* Meat** Herd (a) Meat (b) Herd (c) Meat (d) (c/a) (d/b) Cattle 7 890 962 133 625 8 761 385 142 436 9 506 103 107 110 8.5 -24.8 Sheep 3 345 340 14 641 3 499 933 15 329 3 604 931 18 197 3.0 18.7 Goats 6 441 915 25 235 6 506 334 25 449 6 571 397 25 081 1.0 -1.4 Pigs 3 613 475 51 482 3 729 106 52 541 3 848 437 42 833 3.2 -18.5 Poultry 82 661 540 - 83 901 463 - 85 579 493 - 2.0 - Source: MINEPIA; *In number of heads; ** In tonnes Other livestock products Other livestock products include honey, table eggs and milk. In 2019, honey production rose by 36.6%. In contrast, table egg and milk production dropped by 1.5% and 22.2% respectively.
Honey Milk production increased from 5 276.2 tonnes in 2018 to 7 205.3 tonnes in 2019. The results obtained are attributable, among other things, to the constant supervision of producers, the appearance of new players in the subsector following the demand for Cameroon honey by exporters and the consolidation of the achievements of cooperation between Turkey and Cameroon in honey production.
Activities carried out to support honey production included: (i) the granting of authorizations for the creation of bee farms and bee product processing, storage and marketing units; (ii) the construction of a centre for honey collection at Martap in the Adamawa Region; (iii) support in terms of honey quality control equipment and the training of 25 women in bee product processing techniques at Banyo, Adamawa Region.
Milk and table eggs Milk production stood at 207 216 tonnes, down by 22.2% compared with 2018. This drop is the result of ageing dairy cattle which no longer produce much milk, and insufficient water and fodder owing to the lingering draught in the Far-North and North Regions. Activities carried out to stimulate production concerned : (i) the creation of 4 dairy farms; (ii) the training of 25 producers in milk collection hygiene; (iii) the acquisition of milk production,
26 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW storage, preservation and processing equipment; (iv) the construction of a dairy factory and the acquisition of 4 tricycles, 75 bicycles and 100 cans. Table egg production stood at 81 158 tonnes in 2019, as against 82 407 tonnes in 2018. To ensure market supply, Government issued technical opinions for the importation of 21 523 000 egg producing chicks.
Table 5: Trends in Livestock By-products (in tonnes) Item 2015 2016 2017 2018 2019* Variations (in %) Table eggs 79 059 84 129 67 999 82 407 81 158 -1.5 Milk 208 604 223 527 239 174 266 275 207 216 -22.2 Honey 4 626 5 040 6 087 5 276 7 205 36.6 Source: MINEPIA; *Provisional data 2.1.2.2. Fishing and fish farming
Government’s policy in the sector is to promote and facilitate the integration of nationals into fishing activities. In 2019, fishery production stood at 335 158 tonnes, as against 390 519 tonnes in 2018, recording a 14.2% drop. This decline is due, among other things, to: (i) strict compliance with biological recovery which runs from June to September; and (ii) the reduction in the fishing area and the number of fishermen owing to the security crisis in the South-West Region. Fishery production is dominated by small-scale maritime fishing products which account for 79% of total production. Graph 1: Breakdown of Production by Fishing Type
Sources : MINEPIA
Aquaculture production increased from 5 213.9 tonnes in 2018 to 9 078.2 tonnes in 2019, showing a 74% rise. This trend reflects Government’s actions, notably: (i) the large-scale popularization of innovating aquaculture techniques for floating cage and tank production; (ii) support in terms of inputs and equipment to private promoters engaged in medium- and large-scale aquaculture; and (iii) private sector sensitization on aquaculture opportunities.
Prospects of the livestock, fishing and fish farming subsector
To step up the production of fish, a product which has a significant weight on Cameroon’s balance of trade and in the medium-term prospect of meeting domestic, and even sub-regional demand, aquaculture production, which already recorded a 74% rise in 2019, compared with 2018, will be given an additional boost. It is in this connection that the Government in 2020 published
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a call for expression of interest to encourage and support the establishment of medium- and large-size fish production units. This action supplemented the one relating to the large-scale popularization of innovative techniques for floating cage and tank production. In the same vein, and concerning the improvement of dairy production, the Government imported 165 high-yield cows in October 2020. Fish and milk are two subsector products for which the Government is seeking to meet domestic demand in the medium term. As a result, special attention will also be given to actions to increase their production within the framework of the management of the fund being established to support local production and made in Cameroon products.
2.1.3. Forestry and wildlife subsector
In 2019, forestry and wildlife subsector activities concerned the conservation, management and sustainable exploitation of forest ecosystems. Government’s actions focused on: (i) forest management and exploitation; (ii) reforestation; (iii) the development of wildlife resources and protected areas and; (iv) the development of timber and non-timber forest resources.
2.1.3.1. Forestry and logging
In 2019, the value added of the “Forestry and logging” branch dropped to -2.7%, as against a 7.3% increase in 2018. Timber exports declined by 19.5% to stand at 881 202 m3. These trends are attributable to the drop in external demand for log timber, especially in European Union member countries and Asia.
An area of 117 130 ha of forests was developed under the permanent estate, bringing the total area of developed forest to 6 398 968 ha. The volume of legal timber from the permanent estate placed on the market stood at 902 876 m3, down by 35.6%, compared with 2018.
Table 6: Production and Exports in the Forestry Sector (in m3) Items 2016 2017 2018 2019 Variations (in %) Production Logs 2 968 600 2 750 000 2 953 500 1 902 876 -35.6 Sawn timber 1 114 800 964 500 1 057 092 1 322 957 25.2 Veneer 104 100 121 000 150 000 91 499 -39.0 Exports Wood and wood 1 305 093 1 507 959 1 718 185 1 514 634 -11.8 products of which Logs 807 029 1 017 971 1 096 775 881 202 -19.5 Sawn timber 663 800 641 188 742 535 785 779 5.8 Wood veneer 30 357 35 069 45 977 50 630 10.1 Plywood 3 964 2 116 4 219 5 959 41.2
Sources: MINFOF/COMCAM, MINFI/DGD In the non-permanent domain, the area of forests exploited under participatory management is 69,732 ha. Its exploitation took place through the granting of annual operating permits and annual exploitation certificates for 184 municipal and community forests against 144 in 2018.
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The increase in the number of exploited forests is notably linked to the resumption of activities in the forests of Messondo and Nanga-Eboko, after a long period of shutdown. Tax revenue from logging amounted to 30.9 billion, a decrease of 47.4% compared to 2018. The exit rights represent 39.8%, the annual forestry royalty 36.1% and the felling tax 18%. The forest products export surchage, public auctions of seized timber, fines and other duties and taxes in the forestry sector account for 6%. 2.1.3.2. Enhancement of wildlife resources and protected areas The activities for the development of wildlife resources and protected areas mainly focus on the development of protected areas, sport hunting and visits to protected areas. In 2019, the area of protected areas developed was 790,279 ha, for a total cumulative area of 6,067,012 ha. With regard to sport hunting, the number of hunting tourists increased from 285 in 2018 to 387 in 2019, due to the strengthening of security in hunting areas and the marketing of hunting areas of interest (ZIC). The activity was organized in the ZICs of Adamawa, North, Center, South and East. In the Adamaoua and North ZICs, the shooting plan involved 3,632 animals compared to 3,557 last season. The number of animals collected from these areas is 306. The main species collected are: Derby Eland, buffaloes, Waterbucks and baboons. In the hunting areas of the Center, East and South, the shooting plan covered 1,592 animals. The number of animals collected is 215. The main species are: bongo, sitatunga, blue duiker and Peters duiker. Table 7: Hunting Plan and Results in Hunting Zones Hunting Zones in the Adamawa and North Regions Hunting Zones in the Centre, East and South Regions 2018-2019* 2019-2020 2018-2019* 2018-2019 Species Shooting Shooting Species Shooting Shooting Results Results Results Results plan plan plan plan Elephant 21 1 16 1 Elephant 24 16 8 Buffalo 238 83 243 85 Buffalo 91 138 14 Eland 225 99 220 97 Bongo drum 135 176 95 Derby Hippopotamus 17 3 16 3 Sitatunga 92 139 40 Warthog 174 21 180 22 Giant forest hog 58 88 14 Lion 14 2 15 2 African river hog 70 120 5 ND Baboon 194 33 192 33 Bate's Antelope 96 127 0 Python 87 8 78 7 python 27 40 0 Dama-liscus 36 13 37 14 Peters duiker 122 172 17 Spotted hyena 66 7 68 7 Blue duiker 140 183 22 Water-buck 176 35 177 35 Bitis gabonica 26 132 0 Varan 18 0 16 0 Varan 10 11 0 Others 2291 468 2374 Others 256 250 Total 3557 773 3632 306 0 1147 0 1592 215
Source: MINFOF, ND: Not declared, * Updated data
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Regarding visits to protected areas, there were 39 883 tourists in 2019, down by 13.3%, compared with the previous year. This decline is the result of persistent insecurity in the northern part of the country.
In order to remedy this situation, actions were pursued to strengthen security and enhance the attractiveness of protected areas, in particular through: (i) the construction of living camps in the Mengame Gorilla Sanctuary and a fence around the Mozogo Gokoro National Park in Koza; (ii) the frequent organization of patrols; and (iii) the continuation of “crackdown” operations. Wildlife revenue derived from the exploitation of protected areas amounted to 835.2 million in 2019, that is, an increase of 19.3% compared with 2018. Table 8: Trends in Activities in Protected Areas
Variations Year 2017 2018 2019 (in %) Surface area of protected areas developed in ha 5 901 967 6 415 856 6 067 012 -5,4 Number of hunting tourists (unit) 275 285 387 35,8 Number of visitors to protected areas (unit) 80 292 45 986 39 883 -13,3 Wildlife revenue (in millions) 641.3 699.9 835.2 19,3 Source: MINFOF
2.1.3.3. Development of timber and non-timber forest resources
The development of timber and non-timber resources concerns: (i) the popularization of promotional species; (ii) training in woodwork trades; (iii) intensification of fuel wood promotion; and (iv) the marketing of non-timber forest products.
In 2019, the marketing of promotional species focused on 1.6 million m3 of raw timber, of which 484 018 m3 of legally sourced lumber. The actions implemented to promote unknown timber species on the market concerned: (i) the sensitization of economic operators and the dissemination of technical information sheets concerning promotional species; (ii) the updating of the list of promotional species and monitoring of domestic timber market activities; and (iii) participation in national and international fairs to promote Cameroon’s timber and non-timber species.
Regarding training, particular emphasis was placed on capacity building in order to improve the competitiveness of craftsmen. Actions carried out include: (i) training of 209 craftsmen in wood drying and the making of solid wood panel works; (ii) training of economic operators on how to fill secure documents and annual progress reports; (iii) educating and guiding managers of wood processing plants on the need to develop their businesses legally; and (iv) providing support for the creation of new wood processing plants.
As part of the development of the fuel wood subsector, 28 889 metric tonnes of wood were sold, representing an increase of 27.4%, compared with 2018. This change is linked notably to: (i) support to organized groups in the carbonization of waste around wood processing units; (ii) dissemination of the information and awareness guide on the production of legal charcoal; and (iii) sensitization of owners of wood processing units in the Centre Region on the transformation of sawmill waste into charcoal.
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Regarding the promotion of non-timber forest products, the quantities exported increased from 5025.4 tonnes in 2018 to 7146 tonnes in 2019, valued at 7.08 billion CFA francs. 2.1.4. Environment and nature protection The Government’s objective is to mainstream sustainable development principles in the formulation of national policies by: (i) promoting sustainable biodiversity management; (ii) combating desertification and climate change; and (iii) controlling pollution, nuisances and harmful and/or dangerous chemical substances. 2.1.4.1. Sustainable biodiversity management In 2019, the following activities were carried out as part of efforts to promote sustainable biodiversity management: (i) production and transplanting of 21 000 mangrove seedlings; (ii) cleaning of aquatic invasive species on 10 ha of water bodies, bringing the total to 120 ha; (iii) issuance of 130 environmental compliance certificates and 30 approvals for the conduct of environmental assessments. 2.1.4.2. Combating desertification and climate change In 2019, the activities of the “Green Sahel Project” continued in the Far-North Region with: (i) the restoration of 1 250 ha of land through the planting of 20 000 trees; (ii) securing restored sites with the recruitment of security guards; (iii) construction of five boreholes; and (iv) manufacture and distribution of 9 300 improved stoves. Regarding efforts to combat climate change, 30 MINEPDED senior staff were trained in greenhouse gas emissions calculations and 100 people were trained in good agro-sylvo-pastoral practices, and the prevention and management of climate change-related risks. 2.1.4.3. Control of pollution, nuisances and harmful and/or dangerous chemical substances In 2019, pollution control actions carried out included: (i) the inspection and control of 4 464 facilities and 788 ships; (ii) the commissioning of 17 business checkpoints; (iii) the seizure of 84.6 tonnes of plastic packaging in the ten regions following compliance checks; (iv) the organization of fine collection missions in 435 companies as part of the fight against non- compliant plastic packaging; (v) issuance of 124 environmental permits for waste management; (vi) treatment of 35 712 000 litres of liquid waste and 36 860 tonnes of solid waste. 2.1.5. Research and innovation In 2019, several actions were implemented by the national research, development and innovation system. The actions were mainly aimed at: (i) increasing technological, cartographic and information production; (ii) contributing to developing human capital; and (iii) promoting and supporting innovation. Regarding efforts to increase technological, cartographic and information production, activities focused on: (i) the installation and permanent commissioning of a Global Navigation Satellite System station; (ii) the continued development of the cartographic database covering 22 000 km2, increasing the area covered from 8000 km2 to 30 000 km2 in the North Region; (iii) setting up of a Geoscope station in Edea; and (iv) monitoring the degassing of Lakes Nyos and Monoun. Concerning contribution to human capital development, the actions undertaken include: (i) the establishment of a permanent control system for foodstuffs imported through seaports
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and airports and the rehabilitation of the buildings of IRAD’s Centre for Food and Nutrition Research; (ii) the popularization of the use of radiological emergency plans in entities using ionizing radiation sources, particularly in hospitals, laboratories and medical imaging centres; (iii) the conduct of further research on Ebola virus reservoirs and its mode of zoonotic transmission as well as plasmodium and HIV genetic diversity; (iv) quality control of medical imaging chains, dose monitoring in 682 workers under ionizing radiation and monitoring of environmental radioactivity. Concerning innovation promotion and support, activities were continued particularly through: (i) the production and distribution of forest seeds, cashew seedlings, basic arabic gum seeds and improved oil palm seeds; (ii) increased production in non-conventional livestock rearing; (iii) the installation by the National Technology Development Committee of a “Rural Energy Container” for the supply of water and electricity in any locality without electricity. 2.2. Secondary Sector In 2019, the secondary sector grew by 4.9%, after standing at 3.1% in 2018. This improvement is attributed mainly to the good performance of “extractive industries”, which grew by 8.4% in 2019, as against -2.6% in 2018. The contribution of the secondary sector to real GDP growth rose from 0.8 point to 1.3 points and its share in GDP was 26%. Table 9: Secondary Sector Growth Rate Trends Item 2014 2015 2016 2017 2018 2019 Secondary Sector 5,5 9,6 3,6 1,3 3,1 4,9 Manufacturing industries 0,4 4,4 4,4 5,6 3,6 4,1 Extractive industries 14,3 24,8 -3,4 -16,1 -2,6 8,4 Power generation and distribution 12,6 8,9 3,3 5,9 1,2 0,3 Water production and distribution and 4 10 -1,4 6,5 2,6 1,8 sanitation Public works and civil engineering 7,5 8,4 10,4 8,9 7,6 4,7 Source : INS 2.2.1. Manufacturing industries In 2019, manufacturing industries grew by 4.1%, compared with 3.6% in 2018. This acceleration was mainly driven by the vitality of the “textile and clothing industries”; (5.5% after 5.0%) and “chemical industries and chemical products manufacturing” (10.6% after 0.9%). This positive performance was offset by the poor performance recorded in “basic metallurgical industries” (-2.4% after 3.4%) and “beverage industries” (-4.9% after 7.9%). The contribution of manufacturing industries to GDP growth inched up from 0.5 point to 0.6 point. After the fire incident at SONARA, activities in the “oil refining, coking and petroleum” branch are at a standstill. 2.2.1.1. Agribusiness In 2019, “agribusiness” grew by 2.5%. This growth could be attributed mainly to the “fats and animal feed branches” (+ 6.3%), the “milk, fruit and vegetables branch” (+ 4.3%) and “meat and fish branch” (+7.4%). This performance was hampered by lower production in “grain and starch manufacturing” (-0.2%) and “beverage industries” (-4.9%). Growth in the “fats and animal feed industries” mainly stems from an increase in the capacity of some production units, including SODECOTON, which increased the production capacity
32 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW of its Maroua oil mill from 70 000 to 110 000 tonnes in 2019. Likewise, SCR MAYA increased its production capacity from 500 to 1000 tonnes/day. This sector also benefited from the steady supply of raw materials, in particular palm oil and seed cotton. The dynamism observed since 2016 in the “meat and fish industries” continued, growing by 7.4% in 2019, as against 4.5% in 2018. This result could be attributed to the supply of raw materials from peach and meat production. Activity in the “cocoa, coffee and sugar processing industry” branch has been on a positive trend since 2015, which continued in 2019, with a growth rate of 3.8%. This increase is the result of the extension of the production capacity of several operators. SIC CACAO, the main cocoa bean processing operator, increased its production from 35 000 tonnes to 55 000 tonnes. In addition, new bean processing plants are operational. These include Neo Industry with an annual cocoa bean processing capacity of 32 000 tonnes. For its part, sugar production stood at 124 500 tonnes in 2019, up by 10% compared with 2018. This increase is due to the fact that in 2018 the main operator, SOSUCAM, initiated an investment programme worth more than 40 billion for: (i) the irrigation, planting and mechanized harvesting of sugar cane; (ii) the expansion of plantations from 26 000 ha to 32 000 ha; and (iii) increased yields with the introduction of new varieties; (iv) increased plant production capacity and output. Activity in the “beverage industries” fell to 4.9% in 2019, as against an increase of 7.9% in 2018. This development is attributable to the decline in the production of non-alcoholic beverages (-17.9%) and alcoholic beverages (-7.3%). The operators of the branch advance difficulties in importing raw materials, as well as disruptions observed at the beginning of the year due to uncertainties over the application of the provisions of the 2019 Finance Law relating to an increase in excise duty. In addition, the diversification of carbonated drink, mineral water and table water supply led to a fall in prices and an increase in consumption. In the “grain processing and starch products manufacturing” branch, activity remained on a downward trend (-0.2% in 2019 after -1.1% in 2018) due to difficulties in importing the raw material, notably wheat. The rate of use of local products remained low, although there are possibilities for substitution (potatoes, cassava, yams, plantains, etc.). In addition, production trials are being conducted using new wheat varieties with the assistance of IRAD in the Adamawa Region.
Table 10: Growth Rate by Agribusiness Industry Branch (%) Libellés 2015 2016 2017 2018 2019 Designation 3,4 1,2 9,6 4,5 7,4 Meat and fish industry 2,1 11,7 1,8 -1,1 -0,2 Manufacture of grain mill products, starches and 21,7 9,1 21,0 3,9 3,8 starch products Cocoa, coffee, tea and sugar industry 7,9 3,3 17,6 9,1 6,3 Fats and animal feed industry 5,3 -0,1 4,5 -1,8 1,3 Manufacture of cereal-based products -18,3 20,7 -3,1 1,4 4,3 Dairy, fruit and vegetable and other food product -5,0 1,2 -0,6 7,9 -4,9 industry Beverage industry 2,8 21,8 3,3 -1,6 4,7 Tobacco industry Source: NIS
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2.2.1.2. Other manufacturing industries
In 2019, economic activity in “other manufacturing industries” grew by 5.4%, compared with 3.3% in 2018. This acceleration was driven particularly by the branches: “leather and shoe manufacturing industries”, “papermaking and paper products”, “textile and clothing industries”, “chemical industries and manufacture of chemical products”, “furniture making and other manufacturing activities”, “repair and installation of machinery”, “transport equipment manufacturing”, and “wood industries excluding furniture making”.
Activity in the textile and clothing industries branch remained buoyant, rising from 5% in 2018 to 5.5% in 2019. This branch benefited from the positive performance of the cotton industry, despite the poor performance of the fabric production industry. In fact, the sole cotton fibre production operator recorded a 17% increase in turnover in 2019, reflecting the positive trend recorded during the 2018-2019 farming season. Conversely, the turnover of fabric production activities fell by 24.3%. Fabric production declined because the modernization of production equipment is yet to reach the required level. CICAM, the main cotton processing company in the country, is facing numerous financing difficulties which impede investment. The sector is also hampered by imports of counterfeit and smuggled fabrics, particularly from Asia and West Africa. The “wood industries, excluding furniture manufacturing” branch grew by 8.6%, driven by the positive performance of global demand for sawn wood. The good performance of this branch was due to actions carried out for several years aimed at promoting local wood processing. This activity was further boosted by the provisions of the 2018 Finance Law relating to an increase in the log export tax, which rose from 17.5% to 30%. This legal provision has contributed to increasing the price of timber logs on the international market, thus encouraging local operators to engage in further wood processing. Local processing also benefited from the constraints under the forest law enforcement, governance and trade (FLEGT) agreements on exported timber, concluded between Cameroon and the European Union. In 2019, activities in chemical industries recorded a 10.6% growth, compared with 0.9% in 2018, due mainly to the positive performance of soap industries which posted a 9.2% turnover increase in 2019. This development is partly explained by improved production capacity and growing demand. Activities in basic metallurgical industries fell by 2.4% in 2019, compared with a 3.4% increase in 2018. This decline was due to the financial difficulties faced by the main operator, ALUCAM. Table 11: Growth rate trends in other manufacturing industries (%)
Description 2015 2016 2017 2018 2019 Textile and clothing industries 4,7 7,9 5,3 5,0 5,5 Leather industries and footwear manufacturing 3,1 4,2 4,4 1,7 31,7 Wood industries excluding furniture making 9,5 4,9 1,1 9,8 8,6 Papermaking and paper products 0,8 -3,3 -5,8 -7,4 5,0 Oil refining, coking and industries 3,1 7,5 -7,8 -48,0 -1,2 Chemical industries and chemical manufacturing -4,8 3,6 10,4 0,9 10,6 Rubber production and manufacturing of rubber articles -6,1 -5,4 11,5 4,1 2,5
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Description 2015 2016 2017 2018 2019 Manufacture of other non-metallic mineral products 40,8 11,0 13,4 8,6 1,6 Manufacture of basic metals -2,7 -2,8 17,3 3,4 -2,4 Manufacture of machinery, electrical appliances -0,1 2,0 5,2 13,5 0,7 Manufacture of audio-visual equipment and appliances 6,9 57,6 1,8 6,9 8,5 Manufacture of transport equipment -17,6 14,6 -7,7 2,6 9,3 Furniture making and other manufacturing activities 6,0 4,1 8,4 2,7 4,3 Repair and installation of machinery -22,1 11,4 6,6 0,9 8,4 Source: NIS 2.2.2. Extractive Industries
In 2019, growth in the extractive industries accelerated by 11 points, compared with 2018 and stood at 8.4%. This performance can be attributed to the upturn in hydrocarbon extraction activities which grew from -2.7% to 8.5%. This subsector contributes 1.7 points to growth in the secondary sector, compared with a negative contribution over the past three years.
2.2.2.1. Mining
In 2019, artisanal mining enterprises produced 314.5 kg of gold, that is a 29.8% drop, compared with 2018. This decline observed since 2018 is due particularly to a decrease in the number of mining companies from 180 to about 30, due to the suspension of mining permits, pending the issuance of the implementing instruments of the new Mining Code. CAPAM transferred a share of production worth 45.6 kg to the State. In addition, it purchased 13.9 kg of gold from smallholders on behalf of the State. Actions implemented to improve governance in the mining sector continued with the granting of 91 mining titles (exploration permits, reconnaissance licences, quarrying authorizations, etc.).
During the first half of 2020 and year-on-year, gold production fell by 46.3% to 120.5 kg, of which 27.4 kg were transferred to the State. The Mining Sector Capacity Building Project (MSCP) continued its activities aimed at gradually establishing a modernized mining register. The geological and geochemical survey campaign on the southern block (Edea, Yaoundé, Akonolinga, Abong-Mbang, Medoum and Yokadouma) was completed. In total, out of 11 320 scheduled sampling points for the campaign, samples have already been collected from 8 425 points, that is, an overall completion rate of 74%.
2.2.2.2. Hydrocarbons
2.2.2.2.1. Crude oil
In 2019, crude oil production stood at 26 million barrels, representing an increase of 3.6%, compared with 2018. This trend stemmed from the increase in production investments compared with the previous year. At end-March 2020, crude oil production stood at 6.8 million barrels, that is an increase of 11.5% year-on-year. At the end of the year, it is expected to be almost stable, compared with 2019.
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Table 12: Crude Oil Production (in millions of barrels)
Item 2015 2016 2017 2018 2019 2020* Production 35 33,7 27,7 25,1 26 26,2 Variation (%) 27,3 -3,9 -17,8 -9,4 3,6 0,8 Source: NHC, * Projections
2.2.2.2.2. Natural gas In 2019, natural gas production increased by 36.9% to reach 70.8 billion cubic feet, in line with increased exploitation of deposits. At end-June 2020, natural gas production is estimated at 35.1 billion cubic feet. Table 13: Natural Gas Production (in billions of cubic feet)
Item 2015 2016 2017 2018 2019 2020* Production 12.8 12.6 13.9 51.7 70.8 69.5 Variation (%) 18.5 -1.6 10.3 271.9 36.9 -1.8 Source: NHC, * Projections 2.2.2.2.3. Downstream petroleum products Light and heavy petroleum products In 2019, the production of petroleum products stood at 494 879 metric tonnes, compared with 433 963 metric tonnes in 2018, that is an increase of 14%. Production has been at a standstill following the fire incident of 31 May 2019 which destroyed part of SONARA’s facilities. To ensure market supply, SONARA is encouraged to increase its import of petroleum products up to the ceiling of 80% of the volume of its total authorized imports, depending on its financial capacity. The volume of light petroleum products released for consumption increased by 1.5%, compared with 2018. By product, the increases are respectively 3.1% for petrol, 7.4% for kerosene and 0.1% for diesel. Jet A1 fell by 2.8%. With regard to heavy fuels, the quantities of Fuel 1 500 and Fuel 3 500 consumed decreased by 28.4% and 41.3% respectively. The decrease in the quantities of Fuel 3 500 consumed is due particularly to the shutdown of some thermal power plants, following the injection into the South interconnected grid of 80 MW of electric energy from the Memve’ele dam. Table 14: Light and Heavy Petroleum Products Released for Consumption (in thousands of litres) Item 2018 2019 Variations Light products 1 819 131 1 846 848 1,5 Petrol 678 208 699 480 3,1 Kerosene 116 513 125122 7,4 Jet A1 122 667 119188 -2,8 Diesel 901 743 903058 0,1 Fuel 1500 48 685 34870 -28,4 Fuel 3500 25 186 14773 -41,3 Sources: HPSF-DF Cooking gas In 2019, the supply of cooking gas (LPG) to the domestic market increased by 11.1%, compared
36 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW with 2018 and stood at 127 184 metric tonnes. Imports represented 80% of cooking gas supply. National production increased by 25.3%, thanks to the activities of NHC in its Bipaga site. Cooking gas consumption increased by 9.2%.
Table 15: Cooking Gas Supply (in metric tonnes) Items 2018 2019 Variations Production 20 065 25 145 25,3 Imports 94 396 102 039 8,1 Total supply 114 461 127 184 11,1 Released for consumption 114 013 124 524 9,2
Sources: HPSF-NHC-DF 2.2.3. Electricity generation and distribution
In 2019, the “electricity generation and distribution” branch slowed down to 0.3%, compared with 1.2% in 2018. This deceleration is mainly attributable to the 12.4% drop in demand from high voltage customers, particularly ALUCAM.
For its part, the supply of electric power by ENEO comprising hydroelectric power and thermal power generation, as well as electricity purchases, increased by 0.4%, compared with 1.7% in 2018 to stand at 7 006 240 Mwh. Hydroelectric and thermal power generation fell by 0.9% and 23.2% respectively. The decline in thermal power generation is due to the shutdown of the Ahala, Oyomabang, Mbalmayo and Ebolowa thermal power stations. Electricity purchases increased by 12.5% due in particular to the commissioning of the Memve’ele dam which accounted for about 305 744 Mwh purchased in 2019.
To improve electric power supply, efforts to increase the generation capacity are being pursued with the construction of the Lom Pangar dam foot plant which was 30% completed at end-June 2020 and the construction of the Natchigal dam has been launched.
To increase the population’s access to energy, 100 localities out of the 145 planned were electrified under PLANUT’s rural electrification projects and the PIB, representing a69% execution rate. As part of the diversification of electric power sources, the second phase of the project to electrify 1 000 localities using a solar photovoltaic system is almost completed. The equipment has been installed in 180 localities out of the 184 targeted.
To strengthen electric power transmission capacity, the following actions were carried out: (i) commencement of works on the South Interconnected Grid (SIG) and the East Interconnected Grid (EIG); (ii) on-going replacement of the Bekoko (Douala) and Oyomabang (Yaoundé) transformer stations with a view to increasing their respective capacities to 180 MVA.
The Project to Strengthen and Extend Electric Power Transmission and Distribution Networks (PRERETD) is ongoing and is 71% completed. It involves: (i) the construction of the 90 Kv Mbalmayo-Ebolowa HV 100.5 kilometres line which is 89% completed; (ii) the construction of the 90/30 KV Mbalmayo transformer substation, which has been completed, and that of the Ebolowa substation which is 95% completed. In addition, the construction of MV/LV networks in Nyong et Kelle, Mungo, Sanaga Maritime, Bamboutos, Menoua, Noun, Nde and Benue Divisions has been completed.
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Table 16: Electric Power Supply* (in MWH) Variation 2017 2018 2019 Description (in %) (a) (b) (b)/(a) Hydro power generation 5 014 376 4 970 905 4 923 997 -0,9 Thermal power generation 318 927 491 133 376 985 -23,2 Electricity purchases 1 527 597 1 515 272 1 705 258 12,5 Total 6 860 900 6 977 310 7 006 240 0,4 Source: ENEO * Provided by ENEO 2.2.4. Production and distribution of water and sanitation In 2019, the growth of the “water production and distribution and sanitation” branch slowed to 1.8%, as against 2.6% in 2018. However, water production increased by 12.8% to stand at 824 456 m3/day. The water supply rate remained stable at 50.77%. Government’s actions to boost water production included, among other things: (i) the development of production capacity; (ii) the improvement of access by the population to drinking water. In addition, the volume of waste from sanitation decreased by 12% compared with 2018 and stood at 1 436 054 tonnes. With regard to the development of production capacity, the Project for the Supply of Drinking Water to Yaoundé and its Environs (PAEPYS) from River Sanaga is 62.3% completed. The Nine-City Drinking Water Supply Project is ongoing. The project aims to extend and upgrade the drinking water production stations in the towns of Bafoussam, Bamenda, Kribi, Sangmelima, Dschang, Yabassi, Garoua-Boulaï, Garoua and Maroua. The first phase of the project is 98% completed and has enabled the additional daily production of 10 000 m3 of water in Bafoussam, 10 000 m3 in Bamenda, 7 000 m3 in Kribi and 7 000 m3 in Sangmelima, for a total of 34 000 m3. Studies have been completed and the right-of-way release process is underway for the second phase of the project, which will provide an additional daily supply of 10 000 m3 in Garoua, 7 000 m3 in Dschang, 1 800 m3 in Garoua-Boulai, 600 m3 in Yabassi and 650 m3 in Maroua. Regarding access to drinking water, the actions carried out and social connection campaigns helped to increase the number of subscribers in urban areas from 427 902 in 2018 to 446 976 in 2019, that is an increase of 4.5%. The length of the network increased from 6 760 kilometres in 2018 to approximately 6 875 kilometres in 2019. 2.2.5. Public works and civil engineering In 2019, the growth of the “public works and civil engineering” branch stood at 4.7%, compared with 7.6% in 2018. This slowdown followed the completion of major first-generation projects and the completion of infrastructure related to the hosting of CHAN and AFCON. The branch contributed 0.3 point to GDP growth. Public works and civil engineering activities concerned the construction of roads, buildings and other infrastructure, as well as the rehabilitation, maintenance and upkeep of infrastructure. 2.2.5.1. Construction of roads, buildings and other infrastructure Regarding the construction of roads and other infrastructure, Government’s actions in 2019 included: (i) the tarring of the structuring network, the non-structuring network and the council network; (ii) the construction of engineering structures, buildings and public edifices; (iii) the opening up of production basins; (iv) the development of the highway network; (v) the implementation of the Three-year Emergency Plan for Growth Acceleration.
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Regarding the tarring of the structuring network, the Yoko-Lena (45.3 km); Kumba-Nfaitock- Mamfe (150.54 km); Bamenda-Batibo-Numba (82 km); Manki-Mape Bridge (25.80 km) road sections have been completed. Concerning the tarring of the non-structuring network and the council network, the following road sections were accepted: Catholic University of Bertoua access road (1.6 km); Bafounda Carrefour-Marché Diatsi-Batcham Chefferie (11 km); Carrefour Fotso Victor-CETIC Bamendjinda-Calmet-Badjeunfe Bamesso (9 km); and Songmbengue- Ngambe (16 km) sections. Other sections of the structuring and non-structuring networks are under construction. Concerning the construction of engineering structures, those approved are notably the bridges over the rivers Mayo Galke (144 ml); Mayo Soulabe (17 lm), Sanaga to Natchigal (400 lm); Wouri, including its complementary facilities (756 lm road viaduct and 746 lm railway viaduct) and Ntem on the Kakar-Sabongari road (15 lm). Similarly, the works to replace the collapsed nozzles at the entrance to Douala with culverts on a 48 lm section have been completed. Regarding the construction of public buildings and facilities, the head office building of the National Institute of Statistics (NIS) has been completed and many other administrative buildings are under construction. Table 17: Civil Engineering Project Implementation Rate in 2019 (%) Project Length 2018 2019 Bridge over the Wouri 720 lm 98.8 100 Additional facilities on the bridge over the Wouri project. nc 90 100 Bridge over the Mayo-Soulabe river in Banyo 17 lm 81 100 Bridge over the Mmem river in Olouri 70 lm / 55 Bridge over the Mayo Galke river between Tchollire and 144 lm 100 100 Toubouro Bridge over the Ntem river (Kakar-Sabongari Road) 15 lm / 100 Bridge over the Sanaga river at Natchigal 400 lm / 100 Culverts at the East entrance of Douala / 50 100 Construction of 55 ACROW metallic bridges 2 200 lm 25 27 Source: MINTP nc= not concerned
Completion rates of the construction of roads to open up the agricultural basin of the West Region (217 km) increased from 22.7% to 30.7% for the Baleveng-Bangang-Batcham-Galim section and from 50.3% to 69.6% for the Galim-Bamendjing-Foumbot-Bangangte section. The completion rates of the tarring of council roads stood at 13% for Meyomessala, Phase 1 (304.74 km) and 10% for the Nkoumadjap-Nkolfong-Oveng road and the Nkoumadjap-Deng access road (9.11 km). In addition, construction works on the Akonolinga-Nanga Eboko road and the Nanga Eboko- Bifogo access road (22 km) are ongoing.
In 2019, the development of the motorway network led to changes in completion rates from 85% to 89% for the Lolabe-Kribi Lot 1 (38.5 kilometres + 4 km), 67% to 77.5% for the Douala- Yaounde motorway, Phase 1 (60 kilometres + 25 kilometres of recovery lanes) and from 85% to 90% for the rural section of the Yaoundé-Nsimalen motorway (10 km).
Concerning the implementation of the Three-year Emergency Plan for Growth Acceleration (PLANUT), construction works on the following sections is ongoing with execution rates
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ranging from 30% to 46% for the Maroua-Bogo section (41 km), 22% to 26% for the Douala- Bonepoupa section (45 km), 17% to 33% for the Bonepoupa-Yabassi section (50 km), 11.5% to 11.5% for the Ekondo Titi-Kumba section (60 km), 19% to 42% for the Mandjou-Akokan section (45 km), and 33.6% to 55% for the Akokan-Batouri section (45 km).
Table 18: Road Project Implementation Rate in 2019 (%) Project Length Execution Rate Motorway Network 2018 2019 Kribi-Edea: Kribi-Lolabe section 38,5 km + 4 km 85 89 Yaounde-Douala, (PHASE 1) 60 km + 25 km 67 77,5 Yaounde-Nsimalen (rural section) 25 km 85 90 Structuring Network Yoko-Lena 45,3 km / 100 Kumba- Nfaitock- Mamfe 150,54 km / 100 Bamenda- Batibo-Numba 82 km / 100 Manki- Pont de la Mape 25,80 km / 100 PLANUT Maroua- Bogo 41 km 30 46 Douala-Bonépoupa 45 km 22 26 Ekondo Titi-Kumba 60 km 11,5 11,5 Awae- Esse- Soa 72 km / 21,8 Mandjou-Akokan 45 km 19 42 Akokan- Batouri 45 km 33,6 55 Bonépoupa- Yabassi 50 km 17 33 Ngaoundere- Paro 70km / 2 Foumban- Koupamatapit- West/North-West 54km / 10 Region boundary Babuno- Oku (Nkor)- Noni 75 km 0 0 Guidjiba- Taparé 57 km 0 0 Opening up of Agricultural, Industrial and Tourism Production Basins Baleveng- Bangang- Batcham- Galim 110 km 22,7 30,74 Galim- Bamendjing- Foumbot- Bangangté 107 km 50,3 69,6 Akonolinga- Nanga Eboko and Nanga Eboko- 22 km / 4 Bifoga access road Meyomessala Council roads, Phase 1 304,74 km / 13 Nkoumadjap- Nkolfong-Oveng- and 9,11 km / 9,9 Nkoumadjap- Deng access road Rehabilitation works Maroua- Mora 61,4 km 33 36 Ngaoundere- Dang (Phase 1) 12 km 25,16 35 Fin Falaise- Pont de sala (Phase 1) 120 km 35,39 40 Nsimalen- Mbalmayo- Ebolowa 160 km 31,64 58 Source: MINTP
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2.2.5.2. Rehabilitation, maintenance and upkeep of roads and other infrastructure
In 2019, the rehabilitation, maintenance and upkeep of roads and other infrastructure focused on the tarred national and regional road network, council roads and earth roads.
Regarding the tarred national and regional road network, the completed sections include: Ngolbang-Sangmelima-Mezesse-Meyomessala (65 km); Ebolowa-Nkoemvone-Ambam (91.78 km); Ndoupe Bridge-Dibamba Bridge (109 km); Bafoussam-Foumbot-Foumban (67 km); Ekombitie (Intern N1)-South Region boundary (44.54 km); Penja-Ebone-Muyuka Toll Gate (109.8 km); Magada-Maroua (65 km); Malang (Intern. N1)-Maîkoum Bridge (66.59 km); Toubouro- Chad Border (91.6 km); and Edea-Bridge over the Sanaga River (28 km).
As part of the upkeep of more than 50 km of council roads, works have been completed on the following sections: Ngoazik-Zang Ayong-Olamze-Carrefour Meyo Biboulou (52 km) ; Guidiguis-Goundaye-Dzi Gui Lao-Golonghini-Kaele-Guere Me Dzi Gui Lao (70.3 km); Kaélé- Boboyo-Midjivin-Moutouroua-GolomMougoudou-Damai (50 km); Ngaoundal-Djoulde- Nalbize (64 km) and Mandoumba-Etouha-Kelle-Mbéyengué (60 km) in partnership with SODECAO.
The upkeep of earth roads covering a total distance of 1 103.91 km mainly concerned the following roads: Pouss-Logone Birni-Kousseri (165 km); Babongo-Belel-Dompta-Bridge over the Mbere river (120 km); Tchollire-Mayo Djarenti-Chad Border (100 km); Nkambé- Ako Abonshie (Nigeria Border) -Belo-Oku-Kumbo (107.91 km); Bertoua-Deng-Goyoum (102.91 km); and Bangué-Moloundou (148.13 km).
Concerning rehabilitation, the following engineering structures have been accepted: the bridges over the Dibamba river (448 lm), the Benue river (405.68 lm), as well as the replacement of nozzles with culverts on the Yaounde-Ndoupe Bridge section (373.64 lm). In addition, rehabilitation and maintenance works have been completed on the following sections: Edea-Kribi (100 km), Ebolowa-Lolodorf (44.65 km) and Mbandjock-Lembe Yézoum-Megueme’si-Ekwa (112 km). 2.3. Tertiary sector In 2019, growth in the tertiary sector slowed to 3%, as against 4.4% in 2018. This deceleration is mainly attributable to the “restaurants and hotels”, “trade and vehicle repairs”, “transport, warehousing and communications” and “banks and financial institutions” sub-sectors. However, growth accelerated in the “information and telecommunications” branch. The tertiary sector contributed 1.6 points to GDP growth and its weight was 51.5%.
Table 19: Tertiary Sector Growth Trends (in %) Item 2014 2015 2016 2017 2018 2019 Tertiary Sector 4,8 3,4 4,9 4,3 4,4 3,0 of which Trade and vehicle repairs 6,4 3,5 5,6 4,5 5,1 4,2 Restaurants and hotels -2,1 2,2 6,6 5,3 4,3 1,8 Transport, warehousing and communications 3 4,3 2,2 4,2 4,0 3,5 Information and telecommunications 7,3 5,1 6,0 5,7 -2,3 3,9 Banks and financial institutions 5,6 6,9 5,2 6 10,2 6,2 Source: NIS
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2.3.1. Trade In 2019, growth in trading activities stood at 4.2%, as against 5.1% in 2018. They contri- buted 1.4 points to the growth of the tertiary sector. This sub-sector was mainly driven by growth in the wholesale and retail sales margins of fishery and fish farming products (+5.2%), livestock products (+3.0%), furniture, miscellaneous industrial products (+7.3%), refining products (+11.9%), non-metallic mineral products (+18.3%), oil seeds and animal feed (+6.3%), rubber and plastic products (+7.4%) and leather and shoe products (+26.2%). This trend was mainly mitigated by lower growth margin in cocoa, coffee, tea and sugar products and beverages.
Table 20: Growth Rate of Trade Margins by Product (in %)
Item 2015 2016 2017 2018 2019 Agricultural products 6,7 5,5 3,5 0,3 0,7 Livestock and hunting products 10,5 4,7 6,1 6,0 3,0 Forest products 1,2 -4,3 7,5 4,6 -1,7 Fishing and fish breeding products 1,9 4,3 3,3 -0,2 5,2 Other extraction products 12,3 3,9 16,0 -13,1 9,9 Meat and fish 1,8 5,8 -2,7 3,8 3,7 Grain mill products, starch and starch products 1,4 -1,5 4,1 -21,6 0,9 Cocoa, coffee, tea and sugar products 17,9 3,6 17,4 2,6 -10,3 Oilseeds and animal feed -1,6 0,9 15,6 5,1 6,3 Bakery products 6,2 3,9 3,6 -2,1 0,7 Dairy products; fruit products -4,0 5,7 1,3 1,6 5,1 Beverages -3,6 2,3 -0,4 4,6 -4,4 Tobacco products -18,9 -21,5 18,2 -8,8 -5,9 Textile and clothing industry products 7,7 5,5 2,5 1,7 2,8 Leather and footwear 2,9 8,5 0,3 0,3 26,5 Wood and wood works 12,4 0,1 -1,9 5,7 7,2 Paper and cardboard; printed and published works 23,6 -2,1 -7,4 -9,1 -0,3 Refining and coking products 2,5 -2,5 4,7 -11,7 11,9 Chemical products 6,3 9,1 2,5 4,2 4,7 Rubber and plastic products -0,5 1,6 0,9 3,6 7,4 Other non-metallic mineral products 14,1 12,3 4,6 -1,2 18,3 Basic metal products and metal articles -3,2 -5,1 2,8 5,5 -2,3 Machinery, electrical appliances and equipment 2,4 1,2 4,1 17,3 6,4 Audio-visual equipment and appliances -8,5 29,9 -49,7 1,9 3,9 Materials of transport -9,1 2,1 -7,9 -1,4 9,3 Furniture, products of various industries 7,9 2,8 4,6 -1,0 7,3 Wholesale & Retail 3,1 2,9 1,5 3,6 4,2
Source: NIS
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In this branch, trade policy priorities continued to focus on the promotion of the consumption of local products and support for consumption. Actions focused on: (i) the continuation of “crackdown” operations which led to the seizure of several contraband products (alcoholic beverages, disposable diapers, rice, fuel and lubricants) and the identification of offences relating to the illegal increase in prices; and (ii) the organization of exhibitions for the promotion of products made in Cameroon.
During the 2021-2022 three-year period and in connection with the creation of the Support Fund for Local Production and Products Made in Cameroon, the processing and, therefore, marketing of local products should be strengthened. This initiative aims to reduce the extraversion of the trade sub-sector and thereby develop local product value-added chains.
2.3.2. Tourism
In 2019, the value added of hotel and restaurant activities slowed to 1.8%, as against 4.3% in 2018. This slowdown is attributable notably to the security crises in the North-West and South- West, Far North and East Regions.
The number of foreign tourists remained on a downward trend. In 2019, it fell by 6.3% compared with -3.2% in 2018 to stand at 930 000. The average room occupancy rate dropped by 2.5 points to 47.3% and that of overnight stays decreased by 1.3%.
In terms of accommodation capacity, the number of lodging facilities increased by 4.7% compared with 2018 to stand at 2 382. Out of this number, 855 were classified establishments, representing a 4.4% increase compared with 2018. The number of rooms increased by 2.7% to 21 755, reflecting the continuation of the construction and rehabilitation of hotels initiated in prelude to the hosting of the Africa Cup of Nations.
As part of the development of tourism services, 14 tourist sites have been developed, including: (i) the construction of administrative and boukarous structures around Lake Tison; (ii) the continuation of works to create access roads along the banks of the Benue River; and (iii) the development of the Bota site in Limbe 1. In addition, the construction of a 4-star 70-room capacity hotel in Garoua and the “Bengo” hotel in Ebolowa has been completed. Similarly, hotels such as “La Vallée de Bana” in Bana and “Tagidor Garden” in Bangou, as well as “Saint Hubert” and the Motel “Plaza” in Garoua, benefited from State subsidies from the AFCON budget for their upgrading.
In 2019, Cameroon had 941 natural, historical and cultural sites divided mainly into “crafts and markets”, “chiefdoms and sultanates”, “lakes”, “waterfalls and falls”, “mountains, peaks and cliffs”, and “monuments”. In addition, there are 481 approved catering establishments, 236 approved leisure establishments and 296 tourist agencies.
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Table 21: Breakdown of the Number of Classified Hotels by Region and by Category in 2019 Room Ca- Hotel Category Region pacity 5 Stars 4 Stars 3 Stars 2 Stars 1 Star Total Adamawa 988 0 0 2 10 36 48 Centre 5 045 1 5 12 42 118 178 East 718 0 0 1 4 34 39 Far-North 1 390 0 0 6 6 61 73 Littoral 5 506 0 5 24 57 72 158 North 728 0 0 3 4 30 37 North-West 1 857 0 0 8 16 49 73 West 2 897 0 1 7 48 87 143 South 1 561 0 1 10 15 44 70 South-West 1 065 0 0 4 9 23 36 Total 21 755 1 12 77 211 554 855 Source : MINTOUL 2.3.3. Transport Transportation activities were the second largest contributor to real GDP in the tertiary sector. In 2019, its growth was 3.5%, down by 0.5 points compared with 2018. Activities in this subsector focused on road, rail, air, and maritime transport. 2.3.3.1. Road transport The vitality of this subsector can be assessed based on the quantities of premium fuel and diesel released for consumption. The latter increased by 1.4% in 2019 compared with 3.5% in 2018, reflecting a slowdown in road transport activities. This trend is due notably to the slowdown in commercial activities and the reduction in the movement of travellers due to security crises. In 2019, Cameroon’s vehicle fleet registered 40 555 new vehicles, increasing the number of vehicles to 980 897. The number of new vehicle registrations was 78 030, of which 39 753 were cars and 38 277 motorcycles. The number of cars less than 10 years old was 9 252, representing 23.2%. Table 22: Number of New Vehicle Registrations by Category Percen- Vehicles 2015 2016 2017 2018 2019 Total tage (%) Motorcycles 47 115 52 273 39 904 35 813 38 277 213 382 47,65 Passenger cars 35 366 35 232 38 637 29 590 27 544 166 369 37,15 Buses and minibuses 1 543 1 542 1 189 982 1 004 6 260 1,4 Trucks and Vans 5 922 5 798 5 635 4 978 4 928 27 261 6,09 Utility vehicles 2 214 2 164 2 127 1 855 1 624 9 984 2,23 Others 5 449 4 711 4 887 4 856 4 653 24 556 5,48 Total 97 609 10 1720 92 379 78 074 78 030 447 812 100
Source: MINT. Vehicles include buses, vans, trucks, farm machinery, public works machinery, special machinery, minibuses, motorcycles, semi-trailers, road tractors, tricycles, utility vehicles, passenger cars. By category, motorcycles accounted for 47.7% of new registrations. They were followed by passenger cars (37.2%).
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Table 23: Number of Registered Vehicles by Age b/a c/b Categories 2014 2015 2016 2017(a) 2018(b) 2019(c) (%) (%) Less than 1 year 48 406 48 928 53 175 35 391 33 744 33 994 -4,7 0,7 1 to 5 years 4 450 6 256 6 206 12 362 9 655 11 412 -21,9 18,2 5 to 10 years 3 132 3 745 3 562 2 762 2 344 2 123 -15,1 -9,4 10 to 15 years 10 962 11 555 10 856 9 565 6 500 6 134 -32,0 -5,6 15 to 20 years 13 288 15 711 15 837 17 921 12 982 11 877 -27,6 -8,5 20 years plus 9 314 11 409 12 084 14 378 12 014 12 490 -16,4 3,9 Others 21 5 835 Grand total 89 573 97 609 101 720 92 379 78 074 78 030 -15,5 -0,1 Source : MINT
Road transport activities are subject to the obtaining of a license that determines the roads on which transport is allowed. Under this license, the operation of a commercial vehicle is governed by a “carte bleue” indicating the weight and number of passengers the vehicle can carry. The “carte bleue” is required for the transportation of goods, intercity passenger transportation and urban passenger transportation.
In 2019, the number of transport licenses decreased by 3.4% to stand at 4 330. The number of “carte bleue” increased to 27 951, as against 9 661 in 2018.
Table 24: Number of “Carte Bleue” and Licences Issued for Road Transport Description 2014 2015 2016 2017 2018 2019 Transport licence 7 323 7 140 6 680 5 071 4 483 4 330 "Carte Bleue" 25 865 18 396 13 676 10 259 9 661 27 951 Goods transport 15 720 10 430 6 607 4 684 4 694 14 877 Intercity passenger transport 2 754 1 912 1 593 1 260 1 046 3 057 City passenger transport 7 042 5 797 5 319 4 191 3 808 9 732 Others 349 257 157 124 113 285 Sources: MINT The license is classified into Category 1, Category 2, Category 3, Category 4, Special S1, Special S2 commercial motorbike and Special S3. Regarding road safety, the fight against bad driving habits continued with the support of the security forces. The prevention/repression system has reduced the number of injuries and deaths on the roads. The number of deaths in 2019 stood at 627, showing a 19.8% decrease compared with 2018. Table 25: Road Accidents Year 2014 2015 2016 2017 2018 (a) 2019 (b) Variations b/a (%) Total accidents 3 064 2 896 2 895 2 341 1 898 1 533 -19,2 Number of injured 4 043 4 058 4 234 3 435 2 801 2 003 -28,5 persons Number of deaths 1 081 1 091 1 196 929 782 627 -19,8 Source : SED
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2.3.3.2. Rail transport
The national railway is 1 025 kilometres long and consists of 3 (three) lines, two of which are Douala-Ngaoundéré (924 kilometres) and Douala-Mbanga (74 kilometres). The Mbanga- Kumba line (27 kilometres) is not operational due to insecurity. In 2019, rail transport turnover increased by 17.4% compared with 2018 and stood at 44 billion. This improvement is due to the smooth conduct of activities in the goods transport sector. The tonnage of goods transported rose by 19.9%, in line with the 21.7% increase in the number of containers transported, the 14.6% increase in the volume of hydrocarbons and the 11.6% increase in timber logs. CAMRAIL has acquired five new locomotives to increase freight activities. Passenger traffic was down by 0.9% compared with the previous year, due to limited transport services following the withdrawal of several rolling stock for maintenance. Table 26: Rail Traffic Trends Variations 2016 2017 2018 2019 Year (%) (a) (b) (b/a) Passenger transport (passengers/km) 539,1 262 256,8 254,6 -0,9 Freight transport (tonnes/km) 846 806 784,6 940,6 19,9 Turnover (in millions) 47 227 38 715 37 561 44 103 17,4 Source : CAMRAIL 2.3.3.3. Maritime transport
In 2019, the number of ships departing from and arriving at the Douala Port Authority was 3 361, as against 3 343 in 2018. This increase in the movement of ships led to an 8.7% increase in the tonnage of goods traded. This trend is the result of the combined effect of a 16.3% increase in the tonnage of imports mitigated by a 12.6% drop in export tonnage. Turnover increased by 1.6% due to the revision of concession contracts and the establishment of collection services The increase in import tonnage is due to higher purchases of fuels and lubricants (+62.8%), hydrocarbons (+53%), cereals (+33.4%), crude oil (+32.1%) and clinker (+28.4%). The drop in export tonnage is attributable to the decline in the quantities of wood and wood products (-11.8%), aluminium (-21.6%) and fuels and lubricants (-59.9%). Table 27: Maritime Traffic Trends Variations 2016 2017 2018* 2019** Item (%) (a) (b) (b/a) Number of vessels 3 188 3 132 3 343 3 361 0,5 Transport (in thousands of tonnes) 11 043 11 796 11 835 12 860 8,7 Imports (in thousand tonnes) 8 163 8 466 8 694 10 114 16,3 Exports (in thousand tonnes) 2 880 3 331 3 141 2 746 -12,6
Source: PAD, *Updated data, ** Estimates 2.3.3.4. Air transport
In 2019, the number of passengers who used national airports was 1 468 142, down by 6.7% with respect to the previous year. Air freight fell by 17% compared with 2018.
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Table 28: Air Transport Trends 2016 2017 2018 2019* Variations (en %) Description (a) (b) (c) (b/a) (c/b) 1 424 Passengers (units) 1 214 228 1 572 303 1 468 142 10,4 -6,7 357 Freight (tonnes) 23 650 22 447 24 910 20 659 11 -17
Source: ADC, *Estimates For its part, Camair-Co has been facing a cash flow crisis for the past few years, which is plummeting its activities. In 2019, more than half of the fleet was decommissioned. Faced with this situation, the State opted to sell its shares (51%) to a private operator in 2020. The Head of State thus ordered the urgent preparation of a restructuring, revival and develop- ment plan for the company. He also ordered the allocation of an additional sum of 15 billion to Camair-Co. These funds will be used specifically for: (i) the dispatch for maintenance of one of the two Boeing 737 - 700 NG; (ii) the rental of two engines in order for the second Boeing to resume flights; and (iii) the procurement of two Dash Bombardier Q400 aircraft adapted to short-haul routes.
2.3.3.5. Oil pipeline transportation
In 2019, the volume of crude oil transported by the Chad-Cameroon pipeline totalled 46.3 million barrels, representing an increase of 13.3% compared with 2018. The oil transit duty amounted to 36.6 billion, that is an increase of 24.1%. During the first six months of 2020, 24.8 million barrels of Chadian oil was offloaded at the Kribi terminal, as against 22.8 million barrels year-on-year. This trend is related to the increase in Chad’s oil production. Transit duty in Cameroon generated USD 19.3 billion in revenue, up by 10.4% over the same period in 2019. Table 29: Oil Pipeline Transport Trends Jan.-June Jan.- Period 2017 2018* 2019** 2019 June 2020 Volume of crude oil transported (in millions of barrels) 35,9 40,9 46,3 22,8 24,8 Transit fee generated (in billion CFA francs) 26,9 29,5 36,6 17,4 19,3 Source: COTCO, * Updated data, ** Estimates 2.3.4. Telecommunications In 2019, growth in the “information and telecommunications” branch resumed a positive trend, standing at 3.9%, compared with -2.3% in 2018. This positive growth trend is due to the diversification of promotional offers on new products and innovative services to consumers. This mainly concerned the improvement and extension of the network, the growth of voice and the continued digitization of data and value-added services (VAS). The total number of subscriptions increased by 5.9% compared with 2018 to stand at 21 400 736. Turnover rose by 4.2% to 581 billion, due in part to the gradual rehabilitation of equipment destroyed in some localities in the midst of a security crisis. Voice and SMS traffic increased by 40.8% and 2.8% respectively, due to lower call and SMS rates.
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In order to improve network coverage and service quality, investments were focused mainly on: (i) the deployment of optical fibre broadband infrastructure as part of the implementation of the National Broadband Network Programme Phase II; (ii) the installation of ICT infrastructure and equipment for CHAN and AFCON, with the construction of two towers for the Olembe and Japoma stadiums; (iii) interconnection with Nigeria, CAR and Gabon, resulting in the on-going installation of transnational links of nearly 1 000 kilometres of optical fibre. Table 30: Telecommunications Subsector Activity Trends 2017 2018 2019* Variations (in %) Description (a) (b) (c) (b)/(a) (c)/(b)
Total number of subscribers 21 690 521 20 202 518 21 400 736 -6,9% 5,9
Landline (CDMA 606 237 860 872 856 411 42,0% -0,5 and MVNO) Mobile 19 706 027 18 391 632 21 400 736 -6,7% 16,4 Internet 8 278 198 10 184 017 7 691 494 23,0% 24,5 Traffic Voice traffic (in billion of minutes) 15.3 20.2 28.4 32,0% 40,6 Traffic SMS outbound (in billions) 23.3 23.5 24.2 0,9% 3,0 Turnover (millions) 580 544 550 420 557 025 -5,2% 1,2 Landline 99 751 101 467 103585 1,7% 1,1 Mobile 480 793 448 953 453440 -6,6% 6,5
Source: ART *Estimates 2.3.5. SMEs, social economy and handicrafts In 2019, the number of enterprises created in Centres for Business Creation Formalities (CBCF) increased by 806 units compared with 2018 to reach 14 229. The actions carried out to improve competitiveness and promote entrepreneurship concerned notably: (i) the accession of 173 enterprises to the National Upgrading Programme; (ii) support to 573 SMEs as part of the activities of the Cameroon Sub-contracting and Partnership Exchange, and the signing of 14 sub-contracts which generated 267 jobs; (iii) assistance to 260 agricultural and agri-food SMEs; (iv) the signing 8 agreements with banks to finance 50 projects, and the signing of 12 agreements worth EUR 12 billion as part of APME activities. In addition, the National Pilot Business Nursery at Edea enrolled its first batch trainees composed of 26 young project promoters. Furthermore, extension works on the building housing the nursery continued with the construction of its annex 2. Concerning the promotion of the social economy and handicrafts, 236 social economy organizations received financial support. Moreover, 194 young community leaders were trained in the creation and management of cooperative societies in the East and Littoral Regions. In addition, construction and extension works continued on the Mbalmayo, Ngaoundere, Bafoussam, Garoua and Limbe handicraft villages to ensure the supervision of production, exhibition and marketing activities of craftsmen. As at September 2020, 12 097 enterprises had been created in CBCFs, 82 SMEs restructured and 12 food-processing SMEs supported as part of APME activities. MINPMEESA provided technical and material support worth 5 billion to 18 entrepreneurs from the National Pilot Business Nursery at Edea.
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CHAPTER 3: DEMAND, PRICES AND COMPETITIVENESS In 2019, economic growth stood at 3.7%, driven mainly by domestic demand, which contributed 5.6 points. Conversely, net external demand weighed on growth by 1.9 points. Regarding prices, inflation accelerated and stood at 2.5% after 1.1% in 2018. This acceleration is mainly due to the rise in the prices of “food and non-alcoholic beverages”.
Graph 2: Trends in the Demand Component (in %)
Sources: NIS, MINFI 3.1. Analysis of demand components
3.1.1. Domestic demand In 2019, domestic demand growth stood at 5.2%, down by 0.2 point compared with 2018. However, its contribution has been eroding since 2016 and the trend of its components remains mixed.
3.1.1.1. Final consumptione Final consumption accounted for 81.8% of real GDP and contributed 3.3 percentage points to growth. It increased by 4.1%, but slowed down by 0.5 point compared with 2018. The slowdown can be observed in the private and public consumption trends.
3.1.1.1.1. Private consumption In 2019, private consumption accounted for 71% of GDP. It contributed 3 points to real growth. Private consumption increased by 4.5%, due in part to the increase in consumer loans to households (+21.7%). Private consumption growth slowed by 0.2 point, due to inflation, which peaked at 2.5% over the last four years.
The slowdown is perceptible in the main items of household consumption expenditure, in particular in “food and drink” which accounted for 31.8% of household consumption expenditure. Consumption expenditure for “food and drink” increased by 2.5% in 2019, after 4.2% in 2018. The expenditure trend for other household consumption items is as follows: “restaurants and hotels” (+6.9% after +8.4%), “housing, water, electricity, gas and other fuels”
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(+8.2% after +5.3%); “furnishings, household equipment and routine household maintenance” (+4.2% after +2.6%) and “articles of clothing and footwear” (+5.9% after +3.6%).
3.1.1.1.2. Public consumption
In 2019, public consumption grew by 1.8%. It slowed down by 2.1 points compared with 2018 due to: (i) budgetary savings made as part of the State personnel physical headcount (COPPE); (ii) strengthening of other measures to streamline public spending. In 2020, following the 542.7 billion budget decrease following the negative impact of COVID-19 on the economy, public consumption is expected to drop substantially.
Graph 3: Comparative Trends in GDP and Consumption Components
Sources: NIS, MINFI
3.1.1.2. Investment
In 2019, investment increased by 8.5%, representing a 0.7-point growth compared with 2018. This strong growth is backed by the good performance of business investment and a rebound in public investment. Overall investment accounted for 22.6% of GDP and contributed 2.3 points to real growth.
3.1.1.2.1. Private investment
In 2019, private investment increased by 7.4% after 9.6% in 2018, and contributed 1.5 points to real growth. The trend in business investment growth is reflected in the increase in demand for capital goods imports, particularly in the sectors of hydrocarbon extraction (+36.4%), machinery and electrical appliances (+8.4%) and transport equipment (+11%). Foreign direct investment also contributed to this development, with an increase of 44.6%.
It should be noted that private investment growth slowed down by 2.2 points, mainly due to the deceleration of investment spending, mostly with regard to the acquisition of livestock products (+2.8% after +10.6%) and the acquisition of machinery and electrical appliances (+7.1% after +14.2%). On the other hand, there was an acceleration in transport equipment investment (+10.2% against +4.7%) and furniture (+7.2% against +2.1%).
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3.1.1.2.2. Public investment Public investment rebounded to 11.4% in 2019, after the 3.1% drop recorded in 2018. This was a result of the 14.4% increase in the public investment budget (PIB), to cope, among other things, with the acceleration of the CHAN 2021 and AFCON 2022 projects, the completion of several major first-generation projects as well as the continuation of PLANUT activities.
Table 31: PIB Breakdown by Sector (in billions of CFA francs) 2019/2018 2017 Fiscal 2018 Fiscal 2019 Fiscal Sectors Variation (in Year Year Year %) Sectors 1 001,1 784,4 767,5 -2,2 Production et commerce 145,6 102,7 105,6 2,8 Santé 135,1 91,0 103,6 13,8 Dépenses communes 97,9 147,2 175,5 19,2 Enseignement, formation et recherche 74,1 68,5 71,9 5,0 Administration générale et financière 70,4 49,8 95,2 91,2 Souveraineté 24,1 24,2 32,4 33,9 Défense et sécurité 22,0 6,0 26,1 335,0 Affaires sociales et emplois 11,6 11,6 11,9 2,6 Communication, culture, loisir et sports 5,1 5,3 88,3 1 566,0 Total 1 586,9 1 291,5 1 478,0 14,4 Sources: MINFI, MINEPAT
At the end of the 2019 fical year, the physical execution rate of the PIB was 95.9% compared to 66.3% in 2018. This performance is ascribable to the measures taken by Government for an optimal execution of the PIB. They include: (i) reduction in budget execution start-up times ; (ii) capacity building of stakeholders for optimal appropriation of procedures; and (iii) improved support for all stakeholders in the execution of the PIB.
However, the 2019 PIB execution monitoring report notes some persistent difficulties in investment budget execution. They include: (i) non-compliance with contract award plans ; (ii) unsatisfactory maturation of some projects ; (iii) delay in the physical execution of some jointly funded projects due to late payments ; (iv) abandonment of worksites by some service providers due to delays in advance payments ; (v) poor appropriation of the new procedures for execution of counterpart funds and public investment grants.
3.1.2. External demand The contribution of net exports to GDP growth remained negative, from -1.6 points in 2018 to -1.9 points in 2019. Sustained import momentum continued to dampen gains recorded in terms of improved exports, thus eroding the growth of the economy.
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Graph 4: Percentage of net external demand contribution to growth
Sources: NIS, MINFI
3.1.2.1. Net external demand for goods
Net external demand for goods hampered growth by 1.8 points. This trend resulted from contributions of 0.7 point for exports and -2.6 points for imports.
Graph 5: Trends in the Contribution of Net External Demand for Goods to Growth
Source : MINFI 3.1.2.1.1. Exports of goods
In 2019, the volume of exported goods rose by 5% against 2.3% the previous year. This rise is mainly attributable to increases in volumes of agro-food products (+24%), hydrocarbons (+5.6%), transport equipment (+161%), machinery and electrical appliances (42.1%), chemicals (+21.8 %) and “forestry and logging” (+22.1%). Conversely, exports of non-metallic mineral products and metals, and metal products and metal structures fell by 40.2% and 4.7% respectively. Main cash crop exports also fell, especially forestry (-18.7%) and agricultural (-3.4%) products.
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Table 32: Trends in goods export by major product group (%)
Primary sector products 2015 2016 2017 2018 2019 Agriculture 18,1 4,5 9,4 5,1 -7,2 Livestock and fisheries 23,5 9,1 -21,1 -0,3 -3,4 Forestry 4,4 -8,5 9,2 10,6 2,5 Secondary sector products 7,3 -7,0 305,6 12,5 -18,7 Agribusiness 9,5 -6,1 -8,1 1,6 8,3 Other extraction -5,9 10,4 59,9 -2,3 24,0 Hydrocarbons extraction 47,1 251,5 949,8 -0,9 23,7 Other manufacturing industries 28,7 -16,6 -28,3 6,5 5,6 including: Metal products and metal structures -8,2 6,9 6,2 -1,5 8,2 Woodwork products and wooden items -14,8 -7,2 40,1 -14,0 -4,7 Rubber and plastic products 3,9 19,9 7,0 7,6 10,4 Machinery, electrical appliances and materials -14,1 81,1 -27,2 -3,0 3,3 Textile and clothing industry products -37,8 -54,3 -34,8 -28,9 42,1 Chemicals 25,1 -6,7 4,7 2,7 9,7 Refining and coking products -29,1 -1,3 -8,2 22,0 21,8 Paper, cardboard, publishing and printing products -16,1 11,1 1,8 -9,1 5,4 Transport equipment -30,6 -13,3 256,1 -71,2 264,0 Other non-metallic mineral products and metals 179,4 -63,4 136,5 -65,5 161,0 Audiovisual equipment and appliances -16,5 51,1 34,7 -5,1 -40,2 Grand Total -41,6 -19,8 49,4 6,5 -2,0 Total général 10,8 -4,4 -5,0 2,3 5,0 Source: NIS.
3.1.2.1.2. Imports of goods
The volume of goods imported increased by 12.6%. This increase is mainly driven by imports of hydrocarbons (+36.4%), agribusiness products (+12.3%), transport equipment (+11%), machinery and electrical appliances (+8.4%).
Table 33: Trends in Product Imports by Branch (in%) Description 2015 2016 2017 2018 2019 Primary sector 12,1 -0,6 13,8 -3,2 2,6 Agriculture 9,1 2,9 14,9 -5,4 15,6 Secondary sector 0,7 -2,1 -4,5 9,8 13,0 Hydrocarbons extraction -15,0 -16,1 -63,7 -66,4 36,4 Agro-food industries 2,0 -3,7 6,6 0,0 12,3 Other manufacturing industries 1,2 -0,9 -3,4 17,5 1,0 including Textile industry 39,5 -9,0 -2,8 0,8 1,0 Chemical industry 10,4 -4,0 2,8 4,7 3,0 Metallurgical products 11,9 13,1 -22,6 15,3 1,0 Machinery and electrical appliances -2,5 4,5 -0,7 20,2 8,4 Transport equipment -15,5 -11,7 -6,8 6,9 11,0 Audiovisual equipment and appliances -9,9 30,2 -52,5 8,2 5,3 Goods Imports 1,1 -2,0 -3,8 9,3 12,6 Source: NIS.
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3.1.2.2. Net external demand for services
In 2019, net external demand for services weighed on growth by 0.02 point. The contribution of exports of services was 0.26 point and that of services imports was -0.28 point.
Graph 6: Trends in the Contribution of Net External Demand for Services to Growth
Source: NIS, base year = 2005
3.1.2.2.1. Service export
In 2019, exports of services accounted for 26.6% of total exports. They were driven by the following branches: “transport, warehousing, communications” (30.6% of service exports), “other services” (14.8%), “professional, scientific and technical services” (9.9%) and “banks and financial institutions” (9.2%).
The volume of services exports grew to 4.9% after 2.4% in 2018. This increase is mainly ascribable to the “banks and financial institutions” (5.8% after 9.8%) and “transport, warehousing, communications” (+4.4% compared with -8.2%) branches. However, the “professional, scientific and technical services” branch recorded a 6.4% drop against an increase of 9.1% in 2018.
3.1.2.2.2. Service imports
In 2019, imports of services accounted for 22.8% of total imports. The main branches of service imports were “transport, warehousing, communications” (37.1% of total service imports) and “professional, scientific and technical services” (21.1%). They are followed by “banks and financial institutions” (7.4%) and “other services, dominated by technical assistance” (5.2%).
Imports of services slowed down to 4.4% after 4.7% in 2018. The deceleration is mainly linked to the drop in imports of the “professional, scientific and technical services” branch (-15.1% after + 6.5%) and to the slowdown in the “banks and financial institutions” branch (+6.0% after + 7.1%). Conversely, there was an acceleration in the growth of imports in “other services” (+18.9% after +6.0%) and “transport, warehousing, communications” (+15.7% after +2.3%).
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Table 34 : Evolution des emplois du PIB (en%) Description 2015 2016 2017 2018 2019 1. Final consumption expenditure 5,2 3,3 3,3 4,6 4,1 including private 5,3 3,3 4,3 4,7 4,5 Public 4,7 3,2 -1,6 3,9 1,8 2. GFCF 2,5 4,8 4,0 7,2 8,1 including private 3,3 2,3 6,7 9,6 7,4 Public -0,6 15,2 -6,0 -3,1 11,4 3. Variation of stocks -262,8 -96,3 -395,1 368,8 68,7 4. Investment (2 + 3) -0,3 6,5 4,2 7,8 8,5 5. Net exports -18,7 -4,8 3,2 28,7 26,5 6. Exports 6,4 -0,6 -1,6 2,3 5,0 Goods exports 10,8 -4,4 -5,0 2,3 5,0 Service exports -7,5 13,6 9,2 2,4 4,9 7. Imports -0,3 -1,5 -0,6 8,1 10,6 Goods imports 1,1 -2,0 -3,8 9,3 12,6 Service imports -5,2 0,2 10,7 4,7 4,4 GDP (1 + 4 + 5) 5,7 4,6 3,5 4,1 3,7 Source: NIS.
3.2. Prices
3.2.1. Final household consumer price
In 2019, the inflation rate accelerated by 1.4 points compared with 2018, to stand at 2.5%, the highest level in the past three years. This trend is mainly driven by the rise in the prices of “food products and non-alcoholic beverages” (+2.9%), “restaurants and hotels” (+5.7%) and “clothing and footwear” (+2.8%).
The rise in the prices of food products can be observed at the level of “fruits” (+10.0%), “vegetables” (+6.7%), “sugar, jams, honey, chocolate and confectionery” (+4.2%), “meats” (+3.5%), as well as “fish and seafood” (+2.7%). There was also an increase in the prices of some mass consumption food products, including rice (+8.3%), beef (+2.9%) and frozen mackerel (+1.2%). Conversely, there was a drop in the prices of “oils and fats” (-1.4%), “salt, spices and sauce” (-1.4%) and “milk, cheese and eggs” (-0.4%).
The rise in the prices of beverages and tobacco is attributable to the increase in the value added tax (VAT) and the tariff of excise duties specific to beverages and tobacco. The increase in the cost of hotel services stems mainly from the increase in the tourist tax per night for furnished establishments and other lodgings from 500 francs to 2 000 francs. Likewise, the increase in the prices of alcoholic beverages was reflected on the prices of “restaurant and hotel” services.
There was a persistent rise in the prices of “housing, water, electricity and other fuels”, despite the broadening of the VAT exemption bracket in the electricity and water price list, in accordance
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with the 2019 Finance Law. This measure adopted in 2019 exempts household consumption below 220 KWH and 20 m3 per month, for electricity and for water respectively. Depending on the origin, the prices of local products surged, from a 0.7% increase in 2018 to 2.6%. Those of imported goods rose from 2% to 2.2%. The rise in the prices of local products results from the drop in supply, in connection with the persistent socio-political crisis in the North-West and South-West regions. By sector, the strongest variation in prices is observed in the primary sector (+3.8%), under the effect of the surge in the prices of fresh products (+4.6%), resulting from the drop in production in the North-West and South-West regions. In the tertiary sector, prices increased by 2.1%, owing to the increase in the prices of “restaurants and hotels” services, as well as those of transport services. Prices in the secondary sector rose by 1.6%. Spatially, Bamenda, with a 4.8% inflation rate, had the highest increase in the general level of prices. It is followed by Buea (+3.4%), Bafoussam (+2.7%), Ebolowa (+2.6%), Yaounde (+2.4%), Douala (+2.4%), Ngaoundere (+2.3%), Bertoua (+2%), Garoua (+1.7%) and Maroua (+ 0.7%). Table 35: Trends in final household consumption price index
Sem. 1 Sem. 1 Variation 2016 2017 2018 Expenditure Item Weight 2019 2020 (in%) (a) (b) (c) (d) (e) (c)/(b) (e)/(d) I - Trends by Consumption Item Food and non-alcoholic beverages 31,8 111 112,3 115,6 114,5 118,3 2,9 3,3 Alcoholic beverages and tobacco 1,4 122 123,8 129,6 128,4 132,8 4,7 3,4 Clothing and footwear 9,8 106,3 108,3 111,4 110,6 113,4 2,8 2,6 Housing water, electricity, gas and other 12,9 114,3 114,8 116,7 115,6 120,0 1,7 3,8 fuels Furnishings, household equipment and 5,1 106,4 107,4 109,4 109 110,5 1,9 1,4 routine household maintenance Health 4,8 102 102,5 103,1 103 103,2 0,6 0,2 Transport 11,3 120,8 121,6 124,0 123,6 126,5 1,9 2,3 Communication 4,6 90 90,2 90,5 90,4 91,0 0,3 0,7 Leisure and culture 3,4 103,6 104,5 105,8 105,3 107,1 1,3 1,7 Education 3,1 113,9 115,3 116,7 116,5 117,2 1,2 0,6 Restaurants and hotels 6,7 119,7 121,8 128,7 127,7 131,1 5,7 2,6 Sundry goods and services 5,2 110,2 111,9 114,7 114,2 115,8 2,5 1,4 Overall Index 100 110,9 112,1 114,9 114,1 117,0 2,5 2,5 II - Trend by Group Local products 112,7 113,4 116,4 115,5 118,7 2,6 2,7 Imported products 105,7 107,9 110,2 109,9 112,0 2,2 2,0 Products from the primary sector 115,3 115,7 120,1 118,4 124,4 3,8 5,0 Products from the secondary sector 105 106,6 108,3 107,8 109,5 1,6 1,6 Products from the tertiary sector 113,3 114,6 117,0 116,6 118,5 2,1 1,6
Sources: NIS, MINFI
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In 2019, Government actions to combat the high cost of living and improve the consumer products market continued, among others, through intensification of the fight against illicit commercial practices. To this end: (i) “high impact operations” were carried out following denunciations of infringements of trade regulations; (ii) awareness campaigns on the misdeeds of speculation were organized among traders in markets; (iii) the frequency of periodic markets was increased throughout the country.
In the first half of 2020, final household consumption prices increased by 2.5%. This was largely due to the increase in the prices of “food products” (+3.3%), “alcoholic beverages, tobacco and narcotics” (+3.4%), “clothing and footwear” (+2.6%), “housing, water, gas, electricity and other fuels” (+3.8%), “transport” (+2.3%) and “restaurants and hotels” (+2.6%). The rise in the prices of food products is attributable in particular to soaring prices for fruits (+9.3%), vegetables (+7.7%), meat (+4.3%), “breads and cereals” (+3%), as well as those of “sugar, jam, honey, chocolate and confectionery” (+2.1%) and those of “milk, cheese and eggs” (+2.1%).
Spatially, the first half of the year was characterized by high inflation in Buea (+ 3.9% after +3.5% in the first half of 2019) and Bafoussam (+3.2% after +2.6%). It accelerated in Maroua (+3.4% after -0.7%) and Garoua (+3.1% after 1.6%). For the other regional capitals, there was a drop in inflation compared with that of the first half of 2019, although final household consumption prices are increasing and remain below the national level. These include Bamenda (+2.4% after +5.4%), Ebolowa (+0.1% after +2.8%), Bertoua (+1.8% after +2.1%), Ngaoundere (+1.9% after +2.1%), Douala (+2.3% after +2.5%) and Yaounde (+2.2% after +2.3%).
It should be noted that the global COVID-19 pandemic had a negative impact on economies from the first quarter of 2020. This situation resulted in the closure of borders in several countries, leading to difficulties in the supply and sale of products from Cameroonian enterprises, causing a sharp variation in the prices of some products, including tomatoes, poultry and several spices and fruits.
3.2.2. Global competitiveness Global competitiveness assessed through several categories of indicators. In this part, it is analysed using the real effective exchange rate (REER), the terms of trade, the sovereign rating and the business environment.
Real effective exchange rate and terms of exchange
In 2019, the real effective exchange rate (REER) fell by 1.3% compared with 2018, reflecting Cameroon’s competitiveness gain. This trend is mainly attributable to the 0.9% depreciation of the nominal effective exchange rate (NEER). The depreciation of the NEER follows that of the euro against major currencies (USD, Yen, Yuan). Terms of trade improved by 0.4% compared with 2018, owing to a sharper increase in the prices of exports compared with those of imports.
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Table 36: Trends in REER, NEER and Terms of Trade from 2013 to 2019 (in %)
2013 2014 2015 2016 2017 2018 2019 2018 REER 2,5 0,8 -6,2 2,3 1,0 1,4 -1,3 0,3 NEER 3,7 1,6 -3,7 3,6 2,6 3,2 -0,9 3,2 Source: World Bank, July 2020, base 100 in 2010
Sovereign rating The S&P Global Ratings and Moody’s rating agencies maintained Cameroon’s sovereign rating at “B-” and “B2” respectively. Further, the World Bank 2020 Country Policy and Institutional Assessment in Sub-Saharan Africa (CPIA) reveals that Cameroon has maintained its score of 3.3 and is ranked 16th out of the 39 low-income countries where the quality of policies and institutions is considered average. To improve the competitiveness of Cameroon’s economy, Government initiatives will be continued, such as the dematerialization of procedures and payments of taxes and duties, the establishment of an information system for technical ministries (MINADER, MINEPIA) on the One-Stop Shop of Foreign trade platform, improvement of the quality of agricultural inputs and farmers’ capacity building, as well as modernizing SMEs, particularly in digital skills, digitization of processes and digital visibility.
Business environment According to the findings of the 10th session of the Cameroon Business Forum (CBF) held in March 2019, Government has already implemented 150 recommendations out of the 200 envisaged in ten years. Despite the fact that the World Bank’s Doing Business ranking is currently questioned, the variables used for its elaboration remain relevant. The latest World Bank’s Doing Business reports and those of OECD on ease of trade reveal that Government efforts are not yet sufficient to improve Cameroon’s competitive performance. Regarding ease of trade, the times and costs of transit in Cameroon are on average 8 days 4 hours for an amount of approximately 600 000 CFA francs for export and 11 days 2 hours for a transit cost of 800 000 CFA francs on import. These indicators are the least competitive both in sub- Saharan Africa, where the transit times and costs are respectively 4 days and 350 000 CFA francs, and in the CEMAC zone and countries with the same level of development like Côte d’Ivoire, Senegal and Ghana. These shortcomings are mainly due to the absence of an interconnected system to boost dematerialized transactions between customs and other players in ports, the excessive number of documents requested, the inadequate infrastructure for compliance with export, excessive checks, lack of professionalism on the part of the players, delays in obtaining certificates for imports when they are necessary. For goods on transit, the multitude police and gendarmerie checks, and the poor state of roads are also deplored.
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CHAPTER 4: FINANCING OF THE ECONOMY In 2019, the financing of the economy took place in a context marked by: (i) continued implementation of the reforms undertaken within the framework of the Economic and Financial Programme concluded with the IMF in June 2017; (ii) popularization and application of the new exchange regulations and the new CEMAC regulation governing the activity of microfinance institutions. The financing of the economy was characterized by an expansion in money supply (+7.4%). Such increase was reflected in a rise in money supply counterparts, notably: net foreign assets (+14.4%), net claims on the State (+60.3%) and credit to the economy (+0.2%). In the first half of 2020, compared to the same period in 2019, the financing ofthe economy was characterized by an 11% money supply expansion, as seen in money supply counterparts, notably: an increase in net foreign assets (+12.4%), a rise in net claims on the State (+114.0%) and a slight increase in credit to the economy (+0.7%). Reflecting this trend, bank loans increased by 2.4%, driven by loans to the public sector and individuals. 4.1. Monetary Policy In 2019, the monetary policy of CEMAC Member States, including Cameroon, was characterized by an exchange regime based on four principles, namely: (i) the fixed parity between the CFA F and the Euro; (ii) the convertibility of the CFA F guaranteed by France; (iii) the total freedom of capital movements among CEMAC countries; and (iv) the pooling of foreign exchange reserves. In the first half of 2020, within the framework of the programme concluded with the IMF and taking into account the economic and financial effects of the COVID 19 pandemic, BEAC implemented a flexible monetary policy aimed at sustaining monetary stability through (i) refinancing and (ii) statutory reserves.
4.1.1. Refinancing policy The refinancing policy conducted through the monetary market comprises two aspects: one based on quantities (bank refinancing) and another based on prices (interest rates manipulations). In 2019, the refinancing policy remained unchanged and was characterized by: (i) the keeping of BEAC’s policy rates, (ii) injection of liquidity into banks through auctions and (iii) financing the State’s cash requirements by issuing government securities on the monetary market. During the first half of 2020, BEAC changed its monetary policy orientation byeasing the monetary conditions characterized by the lowering of policy rates, the suspension of liquidity absorption operations and the broadening of the range of private financial instruments accepted as collateral for monetary policy operations. The aim is to maintain an adequate supply of credit to households and eterprises. The resumption of long-term liquidity injection operations was also decided by the Monetary Policy Committee, with the aim of increasing credit to lending institutions.
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4.1.2. Interest rate steering policy Interest rates were adjusted with regard to: (i) monetary stability risks; and (ii) developments in national and international economic and financial conditions. In 2019, BEAC interest rates were kept unchanged. In the first half of 2020, lending rates were lowered to cope with the consequences of the COVID 19 pandemic. Thus, (i) the interest rates on public tenders (DAO) was reduced from 3.5% to 3.25%; (ii) the marginal lending facility rate fell from 6% to 5%; (iii) the penalty rate for banks was abolished; (iv) the range of private instruments admitted as collateral for monetary policy operations was broadened; and (v) the levels of discounts applicable to public and private instruments admitted as collateral for refinancing operations at the BEAC were raised. To ensure liquidity of the economy, interest rates on public deposits (0%) and the minimum lending rate (2.45%) remained unchanged.
Table 37: Trends in BEAC’s policy rates and banking conditions 31.10.18 18.12.18 25.07.18 27 03.20 Item to to to 30.10.18 to….. 18.12.18 27 03.20 I Treasury operations - Interest rate on public investments (TISPP) . Interest rate on public investments for the Reserve 0,40 0,40 0,40 0,40 Fund for Future Generations (TISPPo) . Interest rate on public investments for the stabiliza- 0,05 0,05 0,05 0,05 tion mechanism on budget revenues (TISPP1) . Interest rate on public investments for special depo- 0,00 0,00 0,00 0,00 sits (TISPP2) II - Money Market 1- Monetary policy instruments . Interest rates on tenders (TIAO) 2,95 3,50 3,50 3,25 . Marginal lending facility rate (TFPM) 4,70 5,25 6,00 5,0 . Deposit facility rate (TFD) 0 0 0 0 Suppri- . Bank penalty rate (TPB) 7,00 7,55 8,30 mé 2- Special refinancing instrument . Effective rates on old irrevocable CMT 3,25 3,25 3,25 3,25 III - Minimum Loan Rate (TCM) 2,45 2,45 2,45 2,45
Source : BEAC
4.2. Money Market Operations
Money market operations cover: (i) money market conventional transactions; (ii) financial stability transactions; (iii) other money market transactions; and (iv) interbank market transactions.
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4.2.1. Money market conventional operations Money market conventional operations involve classical bank refinancing instruments used by the Central Bank. They also include the conditions for remunerating bank deposits at the Central Bank. In line with the common monetary policy, national refinancing targets have been replaced by liquidity injections through auctions. In 2019, the amounts served by BEAC to credit institutions registered a downturn. They represented 48.7% of bids expressed by banks, compared to 73.3% in 2018. In absolute terms, the weekly amounts served were on average 100 billion in 2019, against 152 billion in 2018, in line with the number of participating banks, which reduced on average from 15 in 2018 to 8 in 2019. In the first half of 2020, the amounts auctioned by the BEAC to credit institutions registered a shortfall. Due to the economic consequences of COVID-19, the bids made by banks were fully served from March onwards, compared to an average of 30% in the first quarter of 2020.
Graph 7: Amounts served by BEAC to banks (in % of tenders expressed by banks)
Sources : BEAC/ MINFI 4.2.2. Twenty-four hour marginal lending facility The 24-hour marginal lending facility is loan granted to credit institutions by BEAC. It aims to fill their liquidity shortfalls that were not met at the end of the main liquidity injection operation and after exhaustion of refinancing possibilities on the interbank market.
In 2019, the overall amount of these additional loans tripled to 9.2 billion, on a monthly average, compared with 3 billion in 2018, due to the difficulties encountered by some banks in meeting market conditions. It should be noted that this loan is the most expensive on the money market.
In the first half of 2020, the amount of 24-hour marginal lending facilities rose to a monthly average of 11 billion, compared with 4 billion in the same period in 2019.
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4.2.3. Twenty-four hour marginal lending facility
This operation enables credit institutions that have not found the interbank market satisfactory, in terms of investment opportunities, to make deposits at BEAC counters against remuneration. In the first half of 2020, deposits of 18 billion were recorded for the first time.
4.2.4. Interbank market In 2019, the volume of transactions on the interbank market more than tripled to a monthly average of 291 billion, compared with 77 billion in 2018. This trend is explained by the liquidity squeeze measures implemented by BEAC. Intra-group transactions accounted for 87% of transactions compared with 59% in 2018. In the first half of 2020, compared with the same period in 2019, there was adecline in interbank market transactions. The volume of transactions fell from 228 billion to 66 billion, on a monthly average. Intra-group transactions accounted for nearly three-quarters of transactions. Transactions with a maturity of 7 days were dominant (46% of transaction volume), followed by transactions with a maturity of one month (17%). Transactions with other maturities accounted for 37%. Graph 8: Interbank Transactions in billion CFA francs
Source : BEAC 4.3. Statutory reserves policy In 2019, the statutory reserves ratios/coefficients remained unchanged at 7% for sight deposits and 4.5% for term deposits. As at 31 December 2019 the amount of statutory reserves constituted stood at 249.3 billion, compared to 232.4 billion at end-2018. This trend is related to the increase in loans granted by banks. At the end of June 2020, the amount of statutory reserves constituted was 323.8 billion, compared to 259.1 billion as at 30 June 2019. They were remunerated at a rate of 0.05% and represented 25% of all bank reserves at BEAC.
4.4. Situation monétaire At the end of December 2019, the monetary situation was balanced in terms of income and
62 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW expenditure at 6 539.3 billion, up by 9.8% compared to the end of December 2018. The monetary situation was characterized by an increase in all its aggregates: (i) net foreign assets are growing; (ii) domestic credit is increasing, driven by net claims on the State; and (iii) money supply is growing. At the end of June 2020, the monetary situation was balanced at 6 873.6 billion, up by 12.4% compared to 30 June 2019.
Table 38: Consolidated monetary situation (in billions) Dec.-18 June-19 Dec.-19 June-20 Variations in % Items a b c d c/a d/b d/c Counterparts to monetary system re- 5954,8 6 113,6 6 539,3 6 873,6 9,8 12,4 5,1 sources Net foreign assets 2072,7 2 214,6 2 370,8 2 337,2 14,4 5,5 -1,4 BEAC’s net foreign assets 1477,2 1701,6 1653,0 1494,4 11,9 -12,2 -9,6 Including: Operations account 1948,2 2156,8 2079,7 2124,6 6,7 -1,5 2,2 Foreign currency assets 23,5 60,0 79,3 74,7 237,2 24,4 -5,8 Recourse to IMF credits 267,8 264,7 302,1 478,2 12,8 80,6 58,3 BCM net foreign assets 595,5 513,1 717,8 842,8 20,5 64,3 17,4 Domestic credit (a+b) 3882,1 3 899,0 4 168,5 4 536,4 7,4 16,3 8,8 Net claims on the state (a) 465,2 537,5 745,7 1 150,1 60,3 114,0 54,2 Net Government position 508,3 549,7 745,0 1 141,9 46,6 107,7 53,3 Other net claims on the state -43,2 -59,1 0,8 8,2 -101,8 -113,9 974,4 Credit to the economy (b) 3416,9 3 361,5 3 422,8 3 386,2 0,2 0,7 -1,1 Bank institutions in the process of liquidation 0,0 0,0 0,0 0,0 50,0 14,3 -11,1 Other bank institutions non – eligible 9,3 7,3 8,7 9,1 -6,7 23,6 4,4 to BEAC’s refinancing Non-bank financial institutions 51,2 27,9 44,8 37,9 -12,5 36,0 -15,5 Non-financial public companies 242,8 247,1 230,0 294,1 -5,2 19,0 27,8 Non financial private sector 3113,6 3 079,1 3 139,2 3 045,2 0,8 -1,1 -3,0 Monetary system resources 5954,8 6 113,6 6 539,3 6 873,6 9,8 12,4 5,1 Fiduciary money 1056,3 1 035,9 1 151,4 1 185,4 9,0 14,4 2,9 Scriptural money: 2179,9 2 273,0 2 326,6 2 496,6 6,7 9,8 7,3 Quasi-money 1807,0 1 854,1 1 938,4 2 050,3 7,3 10,6 5,8 Money supply 5043,1 5 163,0 5 416,4 5 732,2 7,4 11,0 5,8 Other net items 911,6 950,6 1 122,9 1 141,4 23,2 20,1 1,6 Source : BEAC
4.4.1. Money supply counterparts 4.4.1.1. Net foreign assets
As at 31 December 2019, net foreign assets increased by 14.4% compared with the same date in 2018, and stood at 2 370.8 billion. This increase is explained, among other things, by the drawings received from development partners as part of budgetary support and improved export earnings repatriation.
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The currency coverage ratio, defined as the ratio of gross official foreign currency assets to total sight commitments of the Central Bank, improved from 75.5% at end-December 2018 to 76.8% at end-December 2019. This trend was also observed at the level of CEMAC, where the coverage rate rose from 61.3% to 71.6%. As at 30 June 2020, net foreign assets stood at 2 337.2 billion, up by 5.5% compared with 30 June 2019. This situation is due to a 64.3% increase in banks’ net foreign assets and increased budgetary support, mitigated by the 1.5% decrease in assets on the operations account. Net external assets are composed of 36% banks’ external assets and 64% BEAC’s external assets, as against 23% and 77% respectively on 30 June 2019. Cameroon’s gross external assets in BEAC’s books cover 4.95 months of imports of goods and services compared to 5.14 months at the end of June 2019. Moreover, the Community principle of pooling foreign exchange reserves mitigates this performance, in that CEMAC’s external assets cover 3 months of imports of all CEMAC countries. Graph 9: Weight of Net Foreign Assets Components (in %)
Sources: BEAC, MINFI The currency coverage rate improved from 76.4% at the end of June 2019 to 78.6% at the end of June 2020. Such improvement is also observed in all CEMAC countries, where the coverage rate rose from 62.8% to 70.4%. 4.4.1.2. Domestic credit As at 31 December 2019, domestic credit amounted to 4 168.5 billion, up by 7.4% compared with the end of December 2018. This rise results from a 280.5 billion increase in net claims on the State and a rise of 5.9 billion in credit to the economy. The Net Government Position (NGP), the main component of net claims on the State, strengthened by 236.7 billion to stand at 745 billion. This trend is mainly due to: (i) the increase in IMF credit from 267.8 billion to 302.1 billion; (ii) the improvement of NGP towards banks from 199.6 billion to 323.6 billion; and (iii) the NGP increase of 78.4 billion towards BEAC. Credit to the economy increased by 0.2% to stand at 4 322.8 billion. Credit to the non- financial private sector, the main component of credit to the economy (90% of outstanding credits), increased by 0.8%, while those to non-financial public enterprises fell by 5.2%. In terms of maturity, short-term credits represented 55.1% of outstanding credits to the economy, medium-term credits 43.6% and long-term credits 1.3%.
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As at the end of June 2020, compared with 30 June 2019, domestic credit increased by 16.3%, driven by the increase in net claims on the State (+114%). Credit to the non- financial private sector declined by 1.1%. NGP strengthened to 1 141.9 billion, driven by a 253 billion increase in banks’ claims on the State and 213 billion in credit from the IMF. Graph 10: Net Government Position (in billions)
Sources: BEAC, MINFI
4.4.2. Money supply At the end of December 2019, and reflecting the trend in its counterparts, money supply increased by 7.4% compared with the end of December 2018, to stand at 5 416.4 billion. This trend is in line with economic growth (3.7%) and the level of inflation (2.5%). These other components also increased: +9.0% for fiduciary money, +6.7% for scriptural money and +7.3% for quasi-money. As of 30 June 2020, year-on-year, money supply increased by 11% to stand at 5 732.2 billion. It is composed of 20.7% in fiduciary money, 43.6% in scriptural money and 35.7% in quasi-money.
Graph 11: Money Supply Components
(in %) In billions
Sources: BEAC, MINFI 4.5. Banking Sector In 2019, and during the first half of 2020, the banking sector experienced an increase in activity, characterized by: (i) a surge in balance sheet total; (ii) an increase in customer
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deposits; (iii) an increase in customer loans; (iv) an increase in electronic money transactions; and (v) improved compliance with prudential ratios. In 2019, net banking income (NBI) increased by 6.6% compared with 10.9% in 2018. According to BEAC, the total number of bank accounts stood at 3 125 548, against 2 985 075 in June 2019, representing an increase of 4.7%. The bank use rate, with particular regard to the working population, improved to 28.4% after 27.8% in 2018. Broadly speaking, that is taking into account the number of accounts in MFIs and other financial institutions, the bank enrolment rate (number of bank accounts in relation to the working population) also improved, reaching 45.1% in 2019, after 44.6% in 2018.
4.5.1. Balance sheet total As at 31 December 2019 and compared with 31 December 2018, the balance sheet total of all banks increased by 9.5% to stand at 6 417.0 billion. Afriland First Bank ranked first with 18.1% of the total balance sheet of all banks. It was followed by SGC (14.9%), BICEC (11.3%), SCB (9.1%), ECOBANK (7.4%), BAC (7.2%), CBC (6.9%) and UBA (6.1%). As at 30 June 2020, the bank balance sheet total stood at 6 688.1 billion, up by 9.2% compared with the same date in 2019. 4.5.2. Customer deposits At the end of December 2019 and year-on-year, deposits swelled by 9.6%, amounting to 4 870. billion. Such increase was driven by private companies, individuals and the public administration. At the end of june 2020, deposits increased by 10% compared with 30 june 2019, standing at 5 146.8 billion, driven by public and private enterprises, individuals, the central administration and insurance companies. By type of deposits, term deposits, special scheme deposits (savings notes) and sight deposits increased. By type of customers, private individuals held the largest share of deposits (40.8%), followed by private enterprises (23.8%), the central public administration (9.6%) and public enterprises (5.1%). Table 39: Deposits by Customer Type (in billions) Weight in % 31 Dec. 30 June 31 Dec. 30 June Variations in % as at June 2018 2019 2019 2020 Item ending 2020 a b c d c/a d/b Central public services 409,1 428,1 461,2 492,0 12,7 14,9 9,6 Local public services 20,6 46,9 20,9 31,3 1,5 -33,3 0,6 Public services 164,6 167,0 174,4 157,5 5,9 -5,7 3,1 Private services 167,2 107,1 129,4 166,3 -22,7 55,3 3,2 Public enterprises 215,2 244,0 218,0 261,1 1,3 7,0 5,1 Private enterprises 1001,6 1133,1 1111,9 1226,4 11,0 8,2 23,8 Insurance and joint stock com- 149,5 152,5 161,0 159,2 7,8 4,4 3,1 panies Sole proprietorships 189,2 174,5 233,2 197,7 23,3 13,3 3,8 Individuals 1855,3 1946,9 2002,9 2100,2 8,0 7,9 40,8 Sundries 270,0 278,6 357,2 355,2 32,3 27,5 6,9 TOTAL 4442,3 4678,7 4870,0 5146,8 9,6 10,0 100,0
Source: MINFI, BEAC
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By maturity, sight deposits were predominant, accounting for 79.4% of all deposits in 2019. They increased from 3 485.5 billion at the end of December 2018 to 3 841.9 billion at December ending 2019. They were followed by term deposits whose amount rose from 614.7 billion at the end of December 2018 to 652.9 billion at the end of December 2019. At the end of June 2020, sight deposits continued to dominate, accounting for 79.4% of total deposits, against 20.6% for cash vouchers and time deposits.
Table 40: Customer Deposits by Maturity (in billions) Weight as 31 Dec. 30 June 31 Dec. 30 June Variations at 30 June 2018 2019 2019 2020 in % Libellés 2020 a b c d c/a d/b (en %) Special scheme deposits 342,0 361,2 375,3 402,4 9,7 11,4 7,8 Term deposits 614,7 603,1 652,9 659,2 6,2 9,3 12,8 Sight deposits 3485,5 3714,3 3841,9 4085,2 10,2 10,0 79,4 TOTAL 4442,3 4678,7 4870,0 5146,8 9,6 10,0 100,0
Source : BEAC
4.5.3. Customer credits
As at 31 December 2019, the volume of credits amounted to 3 664.6 billion, up by 1.9% compared with the same period in 2018. This increase was driven by credits granted to individuals and the central public administration. On the other hand, credits granted to public and private enterprises and insurance companies declined.
At the end of June 2020, credits amounted to 3 682.3 billion, up by 2.4% compared to 30 June 2019. However, credits to private enterprises, the main component (60.6%), fell by 1.1%, due to a downturn in activities as a result of the COVID 19 pandemic.
The main sectors of activity that benefited from credits were: «building and constructions» (20.9% of total credits), «trade, restaurants and hotels» (17.1%), «transport and transport- related activities» (16.5%), «agriculture, livestock and hunting, forestry and fishing» (14%), «production and distribution of electricity, gas and water» (11.8%), «extractive industries» (11%), «production of community and personal services» (5.5%), «activities of financial institutions, real estate and business services» (2.7%).
Gross non-performing loans stabilized at 16.6% of the stock, while the banks’ external position declined year-on-year.
By customer type, 64.2% of loans were granted to private enterprises, including sole- proprietorships; 16.6% to private individuals; 10.4% to the central public administration and 8% to public enterprises.
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Table 41: Credit Distribution by Customer Type (in billions) Weight in 31 Dec. 30 June 31 Dec. June Variations in % % as at 2018 2019 2019 2020 Items June 2020 a b c d c/a d/b (en %) Central public services 258,3 315,4 295,7 382,5 14,5 21,3 10,4 Local public services 1,4 1,0 1,0 1,3 -30,9 34,0 0,0 Public services 7,5 0,0 0,2 0,1 -97,7 60,6 0,0 Private services 53,8 11,9 11,4 11,0 -78,8 -7,8 0,3 Public companies 251,1 247,1 237,2 294,0 -5,5 19,0 8,0 Private companies 2321,0 2256,2 2227,3 2232,3 -4,0 -1,1 60,6 Insurance and joint stock compa- 3,8 5,2 2,5 2,4 -35,1 -53,6 0,1 nies Sole proprietorships 182,3 160,2 194,0 133,4 6,4 -16,7 3,6 Individuals 509,5 560,1 620,2 610,8 21,7 9,1 16,6 Sundry 8,2 38,1 75,3 14,6 820,0 -61,8 0,4 Total 3596,9 3595,1 3664,6 3682,3 1,9 2,4 100,0 Source : BEAC As at 30 June 2020, the level of financial intermediation, measured by the ratio of loans to deposits, declined to 71.5%, compared with 76.8% at the end of June 2019 and 82% at the end of June 2018. Similarly, the ratio of transformation of deposits to long-term loans deteriorated from 40.2% to 38.9%.
4.5.4. Prudential ratios At the end of December 2019, the situation of prudential ratios of the 15 banks operating on the Cameroonian market, (1- Positive net equity, 2- Solvency ratio greater than or equal to 8%, 3- Coverage of fixed assets at least equal to 100%, 4- Liquidity ratio at least equal to 100% and, long-term transformation ratio at least equal to 50%) was as follows:
- 9 banks out of 15 complied with all prudential ratios; - all banks complied with the liquidity ratio; - 2 banks did not comply with the positive net equity ratio; - 3 banks did not comply with the fixed asset coverage ratio; - 4 banks did not comply with the solvency ratio; and, - 5 banks did not comply with the long-term transformation ratio.
4.5.5. Electronic money In 2019, the main services offered in the field of electronic money remained «Mobile Money» and prepaid bank cards. E-money activity recorded 615.3 million transactions, up by 48% compared with the end of 2018. As a result, the value of these transactions exceeded 11 335 billion, compared with 6 333 billion in 2018. Cameroon’s transactions represented 75% in number and 77% in value of CEMAC transactions.
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Trends in electronic money, in terms of amounts held by users in electronic purses, demonstrates the growing confidence of Cameroonians in this means of payment. Indeed, it was 120 billion on average, against 93.7 billion at the end of 018 and 62.4 billion at the end of 2017. This amount represented 78% of that of CEMAC.
The development of activities in the sector was driven by Mobile Money, whose value of transactions in Cameroon increased by 43.3% compared to 2018, to reach 9 271 billion. The number of mobile money accounts rose from 6.1 million to 9.9 million.
In addition, to facilitate banking operations, credit institutions continued to extend their ATM networks, with the aim of improving and streamlining customer service. The number of ATMs was 720, up by 6.2% compared with 2018. Yaounde, Douala and Bafoussam accounted for 73.3% of ATMs.
Since 1 January 2019, the new CEMAC Regulation No. 04/18/CEMAC/UMAC/CM on the exercise of electronic money issuance came into force. COBAC has subsequently adopted two implementing instruments: one relating to the authorization and modifications in the situation of payment service providers and the other relating to the prudential ratios applicable to payment institutions. However, BEAC is still expected to adopt standards in terms of technical and functional compliance, safety and efficiency of information systems and the quality of transmission and access to the network. 4.6. Microfinance The microfinance sector was marked in 2019 by the continued monitoring of compliance by MFIs with the new Regulation No. 01/17/CEMAC/UMAC of 27 September 2017 relating to the conditions governing the exercise and control of microfinance activities. As at 31 December 2019, Cameroon had 411 authorized microfinance institutions, as against 418 in 2018, which is a decrease of 7 MFIs. This decrease is the result of the continued streamlining of the sector, which has led to the closure of several MFIs.
4.6.1. Distribution of MFIs by category As at 31 December 2019, Cameroon had 411 authorized microfinance institutions broken down into three categories: 361 first-category MFIs, represeting 87.8% of the total, 47 second-category MFIs, and 3 third-category MFIs. First-category MFIs included 116 that operate independently and 245 within a network.
Table 42: Breakdown of certified mfis by category End-December Category End-December 2018 Weight at end-2019 (%) 2019 First Category 368 361 87,8 Second Category 47 47 11,5 Third Category 3 3 0,7 Total 418 411 100 Source: NCC
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The number of MFIs registered under the National Credit Council stood at 282, representing 68.6% of all certified MFIs. This is an increase of 2 MFIs, both category 1.
Table 43: Breakdown of MFIs Registered under the Special Register of the National Credit Council by Category
Category End-December 2018 End-December 2019 First Category 231 233 Second Category 47 47 Third Category 2 2 Total 280 282
Source: NCC. 4.6.2. Geographic coverage At of end of 2019, the number of MFI branches reduced by 16 compared to 2018, to stand at 1670. Such reduction is due to the closure of COMECI and the transformation of CCA into a bank. The proportion of branches located in rural areas was 47%, compared to 53% in urban areas. By category, the proportion of MFIs operating in rural areas was 53.8% for category-1 MFIs, 42% for category-2 and none for category-3 MFIs. The Centre Region had the largest number of agencies, with 26% of the total, followed by the Littoral Region (23%), the West Region (15%), the North-West Region (11%) and the South-West Region (7%). Regions with the lowest coverage were: the Far-North Region (5%), the South Region (4%), the North Region (3.7%), the East Region (3%) and the Adamawa Region (3%).
4.6.3. Trends in overall balance sheets As at 31 December 2019, total balance sheets of MFIs amounted to 658.2 billion, down by 50.3 billion as compared to the end of December 2018. This drop is mainly due to the contraction of the balance sheet total of CCPC (-32.3 billion) and the liquidation of COMECI (-34.9 billion). The breakdown of the cumulative balance sheet total by category was as follows: 50.5% under category-2, 48.9% for category-1 and 0.6% in category-3. Table 44: Trends in MFIs Overall Balance Sheet (in billions) December December-en- December-en- Variations (in %) Category ending 2017 ding 2018 ding 2019 (a) (b) (c) (b/a) (c/b) 1st Category 314,4 321,5 322,2 2,3 0,2 2nd Category 499,3 385,2 332,4 -22,9 -13,7 3rd Category 2,6 1,8 3,6 -30,8 100,0 Total 816,4 708,5 658,2 -13,2 -7,1
Source: NCC 4.6.4. Deposits trends At the end of 2019, deposits collected by MFIs amounted to 518.1 billion, up by 0.8%
70 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW compared to the end of December 2018. They were broken down into 259.3 billion for category-1 MFIs and 258.9 billion for category-2 MFIs. Category-3 MFIs are not autho- rized to raise capital from the public. By type, 84.5% of deposits collected by MFIs were sight deposits, against 8.8% for medium-term deposits and 6.7% for long-term deposits. Table 45: Trends in Deposits in MFIs (in billions) End of Dec. End of Dec. End of Dec. Variations (in %) 2017 2018 2019 Item (a) (b) (c) (b/a) (c/b) 1st Category 252 248,8 259,3 -1,3 4,2 2nd Category 416,1 265,4 258,9 -36,2 -2,4 Total 668,2 514,2 518,1 -23,0 0,8
Source: NCC 4.6.5. Credit trends At the end of 2019, loans granted by MFIs rose to 394.4 billion, compared with 385.2 billion at the end of 2018, that is a 2.4% increase. Category-2 MFIs granted the largest volume of loans (52%), followed by category-1 MFIs (47.7%) and category-3 MFIs (0.3%). By maturity, 55.4% of loans were short-term, compared with 32% medium-term and 12.6% long-term. The majority of loans granted by category-2 MFIs were short-term (76%). On the other hand, 47.9% of loans granted by category-1 MFIs were long-term, mainly financed by the institutions of the CAMCCUL network. Portfolio quality remained the same. The rate of non-performing loans was 18.5%. The amount of non-performing loans stood at 73.3 billion in absolute terms, of which 22 billion for category-1 and 50.5 billion for category-2. The rate of provisioning of non-performing loans improved for category-1 MFIs (+33%) but deteriorated for category-2 MFIs (-5.7%) and category-3 MFIs (-28%).
4.6.6. Performance trends At the end of December 2019, the weight of microfinance in the overall financial sector (banks and MFIs) was on the decline, mainly due to the migration of CCA to the banking sector. The weight of microfinance in the financial sector as a whole was: (i) 10.2% in terms of balance sheet total against 12.1% in 2018; (ii) 10.6% in terms of deposits against 11.6% in 2018; (iii) 10.8% in terms of loans granted by MFIs against 10.1% in 2018; and (iv) 40% in terms of the number of accounts opened in MFIs, that is 2 336 783 accounts. Performance analysis revealed that MFIs have operational weaknesses with regard to: (i) archiving; (ii) strengthening of long-term resources; (iii) coverage of risks with adequate insurance policies; (iv) managing commitments; (v) implementing a reliable IT system; and (vi) the adequacy of an organizational structure. On the other hand, physical security, accounting suspense, internal and external controls, staff qualifications and the functioning of the corporate bodies were satisfactory. In terms of profitability, category-2 MFIs continued to be the most profitable. Return on equity was 14.9% in this category, compared with -12.6% in category-1 and +4.1% in category-3.
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4.6.7. Compliance with prudential ratios At the end of December 2019, MFIs failed to comply with several prudential ratios. These were mainly: the solidarity fund, the ratio on risk coverage by available resources, the ratio on fixed asset coverage and quality standards. 4.7. Financial Institutions As at 31 December 2019, there were 7 financial institutions in Cameroon. They were: SRC, SNI, Crédit Foncier du Cameroun (CFC), Alios Finance, Pro-PME, Société Camerounaise d’Equipement (SCE), and a payment service provider (Wafacash). The consolidated balance sheet total of financial institutions stood at 432.8 billion, compared with 434.5 billion at the end of December 2018, down by 0.4%. This downturn is explained by the decrease in shareholders’ equity and cash and inter-bank transactions. Loans increased by 5.4% to 135.9 billion. Similarly, deposits increased by 10.3% to stand at 53 billion. Non-performing loans reduced by 7.7% to stand at 53.8 billion. Table 46: Trends in balance sheet total of financial institutions (in billions)
ASSETS BALANCE SHEET 2018 2019 Variations Sums deductible from fixed capital 31,1 32 2,9 Capital assets 65,8 67,6 2,7 including financial assets 3,5 3,6 2,9 Customer transactions 129 135,9 5,3 Long-term loans 46 52,9 15,0 Medium-term loans 15,6 16,8 7,7 Short-term loans 7,5 10,3 37,3 Non-performing loans 58,3 53,8 -7,7 Customer debit account 0,4 0,2 -50,0 Other sums due to customers 0 0 Sums not charged 1 1,7 70,0 Repurchased loans 0,1 0,1 0,0 Sundry operations 11,8 11,8 0,0 Cash and interbank operations 197 185 -6,1 including dealings in securities 0 0 TOTAL ASSETS BALANCE SHEET 434,5 432,8 -0,4 LIABILITIES BALANCE SHEET 2018 2019 Variations Fixed capital 335 327,2 -2,3 Including equity 301,5 295,2 -2,1 Customer transactions 48 53 10,4 Special scheme deposit accounts 22,9 24,2 5,7 Term deposit accounts 3,2 5,8 81,3 Sight deposit accounts 4,6 6,2 34,8 Other debit accounts 16,7 16,2 -3,0 Repurchased debt 0,7 0,5 -28,6 Sundry operations 31,9 32,5 1,9 Cash and interbank operations 19,6 20,1 2,6 TOTAL LIABILITIES BALANCE SHEET 434,5 432,8 -0,4 Source: NCC
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4.8. Insurance In 2019, the Cameroonian insurance market continued to be driven by 28 companies, including 17 in the «All Risk Insurance» (IARD) branch and 11 in the «Life insurance» branch. The sector’s turnover remained on an upward trend, standing at 209.0 billion against 207.2 billion in 2018, representing an increase of 1%. Table 47: Trends in Insurance Sector Activity (in billions)
2016 2017 2018 Variations (in %) Branch a b c c/b IARD Turnover 131,2 143,3 141,2 -1,5 Claims paid 58,3 58,3 58,8 0,9 Financial products 5,0 4,9 5,6 14,3 Other net charges 38,9 35,8 36,8 2,8 Net exploitation results 12,2 8,7 10,0 14,9 Life Insurance Turnover 56,9 63,9 67,8 6,1 Claims paid 37,2 35,4 38,0 7,3 Financial products 4,8 3,9 5,7 46,2 Other net charges 10,2 13,1 13,5 3,1 Net exploitation results 3,4 1,3 2,5 92,3 Turnover of the two branches 188,1 207,2 209,0 0,9 Sources: CIMA, ASAC * Provisional data The «All Risk Insurance» (IARD) branch held 67.6% of market share, compared with 32.4% for the «Life and insurance» branch. Paid claims amounted to 96.8 billion whereas financial income stood at 11.3 billion.
Graph 12: Trends in Market Share by Branch from 2015 to 2019 (in %)
Source: MINFI
Turnover for the «IARD” branch amounted to 141.2 billion, down by 1.5% compared with 2018. Service charges increased by 900 million to reach 58.8 billion. Similarly, other expenses
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rose by a net 2.8% to stand at 36.8 billion. Turnover in «Life insurance» branch stood at 67.8 billion, up by 6.1% compared with 2018. Benefits-related expenses increased by 2.6 billion to reach 38.0 billion, equally leading to an increase in net expenses to 13.5 billion. The insurance sector generated a profit margin of 12.5 billion, up by 25% compared with 2018. This increase results from a 10 billion profit from the «Property and Casualty» branch and 2.5 billion from the «Life Insurance» branch. At the end of 2019, the operation of linking insurance companies to regulation No. 0007/CIMA/PCMA/CE/2016 of 8 April 2016 relating to the increase in the minimum share capital to three billion, was not completed. Indeed, 25 out of 28 companies are in compliance with this requirement, including 16 out of the 17 companies in the «Property and Casualty» branch and 9 out of the 11 in the «Life and capitalization» branch. The insurance sector was characterized by: (i) the popularization of the Agreement on the Direct Compensation of Insured Persons; (ii) the centralization of the ordering of motor vehicle insurance certificates; (iii) the monitoring of the application of new procedures for the collection of motor vehicles stamp duty by insurance companies; (iv) the fight against capital flight by monitoring compliance with the provisions relating to community insurance and reinsurance assignments; and (v) the monitoring of large-scale claims. According to the Association of Insurance Companies of Cameroon (ASAC), the prospects for the sector involve: (i) popularization of the mechanism for the direct compensation of policy holders, notably through social networks; (ii) the acceleration of the due diligence processes with ASAC, with a view to setting up a new reinsurance company; (iii) the acceleration of the process of setting up the motor vehicle guarantee fund; (iv) the raising of the minimum capital of insurance companies to five billion by 2021. 4.9. Stock Market The main highlight of the CEMAC financial market in 2019 was the completion of the first phase of the merger of financial market bodies. The merger was materialized by the institutional and physical twinning of: (i) the two regulators (COSUMAF and CMF), effective since March; (ii) the three central depositories (BVMAC, CAA, CRCT) in June; and (iii) the two stock exchanges (BVMAC and DSX), announced in July. At the end of December 2019, sixteen securities featured on the official list of the Central African Securities Stock Exchange (BVMAC), four of which were equities and twelve bonds. Market capitalization more than doubled to 687.5 billion, compared with 313.4 billion at the end of December 2018. It was composed of 31.2 billion for the equity market and 656.4 billion for the bond market. This leap is the result of an increase in the number of shares and bonds following the merger of the two stock exchanges.
4.9.1. Share market As at 31 December 2019, four equity securities were listed on the BVMAC, namely: SMAC, SAFACAM, SOCAPALM, and SIAT Gabon.
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The stock market capitalization fell by 79.4% to stand at 31.2 billion, against 151.3 billion in 2018. This decline is related to the loss of capitalization observed on all stocks, following the merger of the two stock exchanges. These notably include SAFACAM with a downturn of 29.8 billion, representing 84.4%, SEMC (-9.3 billion, down by 83.8%) and SOCAPALM (-86.6 billion, that is 82.6%). As at 30 June 2020, market capitalization stabilized at 31.2 billion, compared with the end of December 2019.
Table 48: Stock Market Capitalization of the BVMAC (in billions) 31/12/2017 31/12/2018 31/12/2019 30/06/2020 Variations Share a b c d d/c b/a c/b SEMC 12,3 11,1 1,8 1,8 0 -9,8 -83,8 SAFACAM 36 35,3 5,5 5,4 -2 -1,9 -84,4 SOCAPALM 97,3 104,8 18,2 18,3 1 7,7 -82,6 SIAT GABON 5,7 5,7 0 CAPITALISATION 145,6 151,2 31,2 31,2 0 3,8 -79,4
Source : DSX. Since August 2019, the prices of shares listed on BVMAC surged, following the reconfiguration of CEMAC’s values during the merger of the two stock exchanges. SEMC share prices multiplied by eight, those of SAFACAM by 2 and SOCAPALM by 1.3. In the first half of 2020, 37 transactions were registered, for a volume of 1 948 shares and a value of 51.1 million .
Graph 13: BV MAC Share Price Trends (in CFA francs)
Source: BVMAC/MINFI
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4.9.2. Bond market As a result of the merger of the two stock exchanges (DSX and BVMAC), the bond market includes twelve securities since August 2019, issued by the State of Cameroon, the State of Gabon, the State of Congo, and some CEMAC companies. At the end of 2019, the capitalization of the BVMAC bond market stood at 656.4 billion, that is 4 times the level registered on the DSX in December 2018. This trend is explained by the merger of the two Central African stock exchanges, thus introduction of new securities, namely: ECMR 5.6% net 2018-2023, ALIOS 01 5.75% gross 2018-2023, and GSEZ 6.50% gross 2018-2028. Also, ECMR 5.5% 2014-2019 and FAGACE 5.25% net 2014-2019 were delisted following their write-off after full amortization. As at 30 June 2020, the bond market stock amounted to 553 billion, up by 20.2% compared with the end of December 2019.
Table 49: Situation of the Bond Market (in billions)
Outstanding Initial Maturity Outstanding Outstanding Value on Debt Date on 31/12/2018 on 30/06/2020 31/12/2019 ECMR 5.6% net 2016-2021 165 17/10/2021 82,5 82,5 ECMR 5.6% net 2018-2023 200 15/11/2023 100 100 ALIOS 01 5.75% gross 2018- 8 19/12/2023 8 7,1 6,2 2023 BGFI Holding 5% gross 2013- 69 13/01/2021 69 69 2020 STATE OF GABON 6% net 84,6 20/09/2020 21,1 21,1 2015-2020 ALIOS Fin. Gabon 6.25% gross 6,3 08/08/2021 1,8 1,8 2014-2021 STATE OF GABON 6.5% net 134,9 09/06/2021 67,4 33,7 2016-2021 EOCG 6.5% net 2016-2021 192,3 29/12/2021 96 ,1 96 ,1 EOG 6.5% net 2017-2022 131,3 04/12/2022 98,5 98,5 GSEZ 6.50% gross 2018-2028 14 14/12/2028 12,6 11,9 EOG 6.25% net 2019-2024 126,3 04/10/2024 126,3 SAFACAM 6% gross 2019- 2 31/12/2022 2 2022 TOTAL 1133,7 460 553
Source: BVMAC
In the first half of 2020, there were 21 transactions on the bond market, involving 418 243 securities with a total value of 3.5 billion. In the second half of 2019, the market recorded 19 transactions, involving 1 307 742 securities for a total value of 11.5 billion. The most traded securities were ECMR 5.5% net 2016-2021, BGFI Holding 5% gross 2013-
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2020, and EOCG 6.5% net 2016-2021, with a transaction value of 2.9 billion, representing 82.8% of trading.
Table 50: Volume and Value of Transactions on the Bond Market of the DSX (value in millions) August-December 2019 January-June 2020 Bond Volume Value Transactions Volume Value Transactions ECMR 5.5% net 2016-2021 40182 317 4 204999 1050 3 ECMR 5.25% net 2014-2019 45000 115 1 0 0 0 ECMR 5.6% net 2018-2023 730560 7280 8 34500 351 3 ALIOS 01 5.75% gross 2018-2023 0 0 0 0 0 0 BGFI Holding 5% gross 2013 - 2020 10000 1014 1 11100 1126,2 2 ETAT GABONAIS 6% net 2015-2020 400000 2114 1 0 0 0 ALIOS Fin. Gabon 6.25% brut 2014-2021 0 0 0 0 0 0 ETAT GABONAIS 6.5% net 2016-2021 5000 25 2 0 0 0 EOCG 6,5% net 2016-2021 74000 555 1 150000 772 1 EOG 6,5% net 2017-2022 5000 52,9 1 0 0 0 GSEZ 6.50% gross 2018-2028 0 0 0 0 0 0 EOG 6.25% net 2019-2024 0 0 0 500 5,1 2 SAFACAM 6% gross 2019-2022 0 0 0 17144 173 10 TOTAL 1309742 11472,9 19 418243 3477,3 21 Source : BVMAC.
4.10. Government Securities Transactions As at 31 December 2019, outstanding government securities amounted to 1 169 billion, up by 28% compared to 2018. They comprised 436.2 billion for the auction market, 282.4 billion for the syndication market and 450.4 billion for the 2015-2025 eurobond. The coverage ratio was 121% for T-bills and 89% for T-bonds. The average interest rate for T-bills was 2.49%. The stock of 1 169 billion at the end àf December 2019 comprised 544.1 billion issuances and 268.2 billion redemptions at the end of August 2020. Table 51: Situation of Government Securities as at 31 August 2020 (in billions) Stock Issuance Stock Stock as at reReimbursement Variation in as at at end- as at Market 31/12/18 at end-August Percentage 31/12/19 August 31/08/20 (a) 2020 (d) (b/a) (b) 2020 (c) (b+c-d) Auctions 102,0 436,2 544,1 268,2 712,1 92,2 T-bills 102,0 196,0 326,4 268,2 254,2 92,2 T-bonds 0 240,2 217,7 0 457,9 - Syndication 361,2 282,4 0 0 282,4 -21,8 ECMR 361,2 282,4 0 0 282,4 -21,8 International 450,4 450,4 0 0 450,4 0,0 EUROBOND 450,4 450,4 0 0 450,4 0,0 TOTAL 913,6 1 169,0 544,1 268,2 1 445,0 28,0 Source : MINFI REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 77 MINISTRY OF FINANCE
4.11. Strategy for financing the economy over the period 2020-2023
The strategy for financing the economy over the period 2020-2023 is based onfour priority pillars: (i) issuance of government securities; (ii) recourse to direct domestic and external borrowing; (iii) reduction of undisbursed but committed amounts (SEND); (iv) the implementation of measures taken by the Government to support economic activity as part of the overall COVID-19 response plan.
Regarding the issuance of government securities, the State plans to issue short-term securities called Fungible Treasury Bills (BTA) on the BEAC auction market to fill its cash flow gaps. Similarly, to finance its basic infrastructure projects, the State intends to issue medium- and long-term securities called Fungible Treasury Bonds (OTA) in national currency by auction, as well as bond issues (ECMR) on the syndication market. In addition, it plans to raise foreign currency funds on the international market (Eurobonds).
As concerns resorting to direct loans, priority will be given to concessional borrowing. Non- concessional loans must be exclusively intended for the financing of projects that generate growth and employment and are likely to generate the resources needed to cover the servicing of the debt related thereto.
To achieve this, a debt strategy will be drawn up each year covering financing for a period of three years, with a breakdown appended to the Finance Law. This strategy aims particularly to meet the State’s short- and medium-term financing needs at a lesser cost and risk. The strategy will focus on reducing refinancing, interest rate and exchange rate risks.
Over the 2021-2023 period, the indebtedness strategy aims to keep the indebtedness ratio below 40% of GDP. The main targets are: (i) a public debt structure consisting of 76% external debt and 24% domestic debt, (ii) the proportion of external debt in dollars must be less than 25% (iii) an average portfolio interest rate of less than 2.5%; (iv) a debt portfolio composition of less than 10% of short-term domestic debt and less than 20% of debt at floating interest rates; (v) an average maturity of the public debt portfolio of more than 11 years; (vi) a ceiling on new external commitments set at 1 950 billion, of which 650 billion in 2021 with 350 billion concessional and 300 billion non-concessional; (viii) a ceiling on new domestic commitments set at 1 030 billion, including 350 billion for 2021; and (ix) a ceiling on guarantees to be granted by the State, set at 120 billion, including 40 billion in 2021.
The 2021Annual Financing Plan targets disbursement of 997 billion CFA francs through external borrowing and 720 billion CFA francs from domestic resources.
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CHAPTER 5: EXTERNAL SECTOR In 2019, external trade was marked at the international level by: (i) a slowdown in the trade of goods to 2.6%, after 3.5% in 2018, according to the WTO; (ii) a slowdown in trade in services to 2% after 9%; (iii) trade tensions between the United States and China; and (iv) the fall in crude oil price. The following was noted at the national level: (i) lingering socio-political and security crises; (ii) increased application of foreign exchange regulations; and (iii) satisfactory implementation of the economic and financial programme with the IMF. In 2020, global trade in goods is expected to decline by about 13%, due to the COVID-19 pandemic. Almost all regions will experience two-digit declines in trade volumes, with the most affected exports being those of North America and Asia. Trade in services is expected to be the most directly affected, due to transport and travel restrictions. Trade is expected to resume in 2021. This resumption will depend on the duration of the pandemic and the effectiveness of the measures adopted to deal with it. 5.1. External Trade In 2019, trade in goods between Cameroon and the outside world amounted to 6 249.6 billion, up by 732.1 billion compared with 2018. This trend results from a 280.4 billion increase in exports and 451.7 billion in imports. In the first half of 2020, trade decreased by 25% to stand at 2 324.3 billion, compared with the same period in 2019.
5.1.1. Trade balance In 2019, the trade deficit widened further, from 1 292.8 billion in 2018 to 1 464.2 billion. This situation results from an increase in imports greater than that in exports. The rate of coverage of imports by exports remained unchanged at 62.0%. Excluding oil, the deficit worsened by 261.5 billion to stand at 2 243.8 billion and the coverage rate fell by 0.4 percentage point.
Graph 14: Trade Balance from 2008 to 2019 (in billions)
Source: MINFI
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In the first half of 2020 and year-on-year, the trade deficit narrowed by 284.9 billion to 487.4 billion. The coverage rate improved by 5.1 points to stand at 65.3%. Non-oil trade deficit narrowed by 228.6 billion to 817.4 billion. This trend is the result of asmaller drop in exports (-86.3 billion) than in imports (-314.9 billion). The coverage rate therefore improved from 39.2% to 41.9%.
Table 52: External Trade Trends (in billions) Jan - June Jan - June Period 2018 2019 Variations (in %) 2019 2020 Item (a) (b) (c) (d) b/a d/c Exports 2 112,3 2 392,7 1 168,3 918,4 13,3 -21,4 Crude oil 862,3 999,5 493,6 330,0 15,9 -33,1 Excluding crude oil. 1 250,0 1 393,3 674,7 588,4 11,5 -12,8 Imports 3 405,2 3 856,9 1 940,7 1 405,8 13,3 -27,6 Crude oil 172,8 219,9 219,9 0,0 27,2 Excluding crude oil. 3 232,3 3 637,0 1 720,8 1 405,8 12,5 -18,3 Trade balance -1 292,8 -1 464,2 -772,3 -487,4 Excluding crude oil. -1 982,3 -2 243,8 -1 046,0 -817,4 Coverage rate (in %) 62,0 62,0 60,2 65,3 Excluding crude oil (in %) 38,7 38,3 39,2 41,9 Source : MINFI
5.1.1.1. Exports
In 2019, the value of exported goods stood at 2 392.7 billion, up by 280.4 billion compared with 2018. This trend results from the good performance of sales of several products, in particular crude petroleum oils (+137.2 billion), liquefied natural gas (+136.9 billion), raw cocoa beans (+55.4 billion) and raw cotton (+13.0 billion). Exports fell for raw timber (-35.4 billion), fuels and lubricants (-22.5 billion), raw aluminium (-11.0 billion) and raw rubber (-6.3 billion). Non-oil exports increased by 143.2 billion to stand at 1 393.3 billion.
Compared with the exports structure, crude oil accounted for 41.8% of total sales. It was followed by raw cocoa beans (12.1%), liquefied natural gas (10.9%), sawn timber (7.0%), raw cotton (5.4%) and crude aluminium (2.4%).
In the first half of 2020, the value of exports stood at 918.4 billion, down by 249.9 billion compared with the same period in 2019. This trend is mainly due to sales of crude petroleum oils (-163 billion), raw cocoa (-5.2 billion) and raw cotton (-32 billion).
Non-oil exports fell by 86.3 billion. Drops in sales of fuels and lubricants (-15.7 billion), sawn timber (-9.6 billion), raw timber (-8.2 billion) and raw cocoa beans (-5.1 billion) were partially offset by the increase in exports of cocoa paste (+4.8 billion), cocoa butter (+3.3 billion) and liquefied natural gas (+2.2 billion).
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Table 53: Export Trends (Q: quantity in thousands of tonnes, V: value in billions) Period Total 2018 Total 2019 Jan-Jun 2019 Jan-Jun 2020 Variations (%) Q V Q V Q V Q V Item b/a d/c a b c d Bananas (including plantains) 217,2 34,2 184,4 24,3 94,2 12,4 93,6 12,2 -28,9 -1,31 Raw cocoa beans 218,8 233,4 218,0 288,9 89,3 108,0 73,0 102,8 23,8 -4,74 Cocoa waste 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 Cocoa paste 26,7 40,7 27,6 44,2 14,3 22,7 15,1 27,5 8,6 21 Cocoa butter 17,8 27,5 19,6 34,2 10,0 16,5 10,4 19,8 24,4 19,9 Chocolates and other cocoa 3,5 7,0 3,8 7,2 1,8 3,4 1,4 2,7 2,8 -19,6 preparations Crude petroleum oils 2904,3 862,3 3811,1 999,5 1862,1 493,6 1854,4 330,0 15,9 -33,1 Fuels and lubricants 176,5 53,1 70,8 30,5 42,4 18,2 6,2 2,5 -42,5 -86,3 Liquefied natural gas 785,6 125,1 1224,5 262,0 599,5 129,4 621,4 131,6 109,4 1,69 Household bar soap 52,9 26,4 53,6 26,9 24,3 12,6 28,8 14,4 2,1 14,1 Raw rubber 41,6 30,0 34,4 23,7 14,0 9,5 10,2 7,1 -20,9 -24,5 Wood and wood products 1718,2 307,0 1514,6 279,9 804,8 145,1 714,7 123,9 -8,8 -14,6 Raw timber (logs) 1,1 121,2 0,9 85,8 0,5 48,9 0,4 40,7 -29,2 -16,8 Sawn timber 0,7 157,8 0,8 167,6 0,4 81,9 0,3 72,4 6,2 -11,7 Wooden veneer sheets 46,0 24,1 50,6 23,5 25,4 12,8 20,6 9,8 -2,3 -23,5 Raw cotton 113,6 117,0 130,1 130,0 76,3 77,1 47,1 44,5 11,1 -42,3 Crude aluminium 62,6 67,7 49,1 56,7 26,1 30,2 22,9 25,8 -16,2 -14,6 Non-oil exports 3825,2 1250,0 3891,0 1393,3 1971,6 674,7 1845,6 588,4 11,5 -12,8 Total Exports 6729,5 2112,3 7702,1 2392,7 3833,7 1168,3 3700,0 918,4 13,3 -21,4 Source: MINFI / DF
5.1.1.2. Imports
In 2019, imports increased by 451.7 billion compared with 2018 and amounted to 3 856.9 billion. This trend is linked to increased purchases of fuels and lubricants (+251.2 billion), cereals (+111.7 billion, including 87.7 billion for rice), crude petroleum oils (+47 billion), ceramics (+38.8 billion), glazed tiles (+34.2 billion), optical devices (+15.2 billion), aluminium and aluminium items (+ 14.8 billion), plastics (+12.7 billion) and motor vehicles and tractors (+9 billion). Imports fell for aluminium oxide (-28.9 billion), inorganic chemicals (-25.6 billion), frozen sea fish (-21.8 billion), electrical optical machines (-19.4 billion) and telephone devices (-14.0 billion). Non-oil imports rose by 404.7 billion to stand at 3,637.0 billion.
The major imported products were fuels and lubricants (18.7% of total imports), machinery and mechanical and electrical appliances (12.9%), rice (6%), crude petroleum oils (-5.7%), motor vehicles and tractors (5.1%), wheat and meslin (3.7%) and frozen sea fish (3.4%).
In the first half of 2020 and year-on-year, imports fell by 534.8 billion to stand at 1 405.8 billion. This trend is mainly attributable to the reduction in purchases of crude petroleum oils (-219.9 billion), fuels and lubricants (-145.1 billion), machinery and electrical devices (-33.2 billion) and rice (-31.9 billion). Non- oil imports fell by 314.9 billion and stood at 1.405.8 billion.
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Table 54: Import Trends (Q: in thousands of tonnes, V: in billions) Period Jan-Dec 2018 Jan-Dec 2019 Jan-Dec 2019 Jan-Dec 2020 Variations (in %) Q V Q V Q V Q V Item b/a d/c a b c d Fish and shellfish 225,7 155,1 185,9 133,3 89,7 65,2 115,7 77,9 -14,1 19,4 Frozen seafood 225,3 154,6 185,8 132,8 89,6 65,0 115,4 77,5 -14,1 19,3 Animals and animal products 248,2 194,0 204,3 167,9 100,2 83,8 130,2 103,1 -13,4 23,1 Cereals 1332,3 267,4 1776,9 379,1 787,0 170,3 706,9 145,4 41,8 -14,6 Wheat and meslin 745,7 115,9 857,9 142,9 383,6 67,7 443,5 74,1 23,3 9,5 Rice 561,1 144,1 894,5 231,8 401,3 102,0 257,2 70,1 60,9 -31,3 Products of the milling 104,0 33,3 126,2 43,0 64,5 22,3 64,1 19,1 29,0 -14,2 industry Vegetable products 1465,2 313,7 1925,6 435,4 860,3 198,4 779,1 170,4 38,8 -14,1 Beverages; alcoholic liquids 50,9 35,6 55,3 39,9 23,9 15,9 26,5 19,7 12,2 23,6 Industrial food products 302,1 162,5 310,0 170,4 123,6 70,9 150,8 89,6 4,9 26,3 Salt; sulphur; land; cement 2455,7 108,8 2976,7 128,1 1440,7 61,2 1010,4 38,2 17,8 -37,6 Clinkers 1991,0 81,9 2556,3 107,1 1245,4 52,9 856,6 30,2 30,7 -42,9 Hydrocarbons 1817,7 736,6 2600,2 1012,5 1627,2 598,9 554,3 225,2 37,5 -62,4 Crude petroleum oils 540,9 172,8 719,5 219,9 719,5 219,9 0,0 0,0 27,2 -100,0 Fuels and lubricants 1026,0 473,4 1670,7 724,6 812,1 347,1 475,2 202,0 53,1 -41,8 Mineral products 4274,7 845,5 5579,2 1140,8 3070,0 660,3 1564,9 263,4 34,9 -60,1 Inorganic chemicals 272,0 90,5 234,2 64,9 141,8 37,7 85,0 20,9 -28,3 -44,6
Pharmaceuticals 16,2 132,9 18,9 128,6 9,2 63,7 10,8 72,4 -3,2 13,6
Fertilizers 209,2 39,3 203,4 41,1 142,7 29,1 133,5 24,4 4,6 -16,1 Insecticides; fungicides; 20,3 50,5 19,3 48,2 13,4 33,2 13,7 34,9 -4,5 5,3 herbicides etc. Chemical industry products 606,9 426,0 555,1 390,0 344,2 213,4 285,6 202,3 -8,4 -5,2 Plastics 107,7 106,0 126,3 118,6 56,3 53,5 65,8 54,2 11,9 1,2 Rubber 29,4 43,2 28,3 41,2 13,3 19,5 14,9 19,4 -4,7 -0,7 New tyres 19,4 29,3 19,3 29,5 8,9 14,2 9,7 14,8 0,7 4,0 Used or rethreaded tyres 6,9 3,3 5,6 2,2 2,9 1,2 3,0 1,0 -35,7 -15,7 Plastics and rubber 137,1 149,2 154,6 159,8 69,5 73,0 80,7 73,5 7,1 0,7 Second hand clothes 76,2 42,7 73,2 39,5 34,2 18,7 37,3 20,2 -7,6 8,0 Textiles and their items 121,1 95,6 121,9 101,7 56,9 49,1 58,5 44,2 6,4 -10,0 Ceramics 187,8 39,0 335,1 72,8 175,9 35,9 107,5 24,4 86,7 -31,9 Stone, cement and glass 230,7 53,4 382,8 91,9 198,7 44,6 130,1 32,2 72,0 -27,7 works Fine pearls, precious metals 0,2 0,2 0,5 2,6 0,1 0,4 0,3 2,2 1361,3 475,3 Cast iron, iron and steel 206,3 109,2 182,9 93,0 105,0 53,1 144,3 79,5 -14,8 49,8 Cast iron, iron and steel 76,4 94,5 72,3 106,0 42,6 55,3 22,2 25,5 12,2 -53,9 products
Common metals and their 306,1 240,9 280,6 250,3 159,5 134,9 176,9 119,1 3,9 -11,7 products
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Period Jan-Dec 2018 Jan-Dec 2019 Jan-Dec 2019 Jan-Dec 2020 Variations (in %) Q V Q V Q V Q V Item b/a d/c a b c d Machinery & mechanical 76,6 283,8 75,3 288,6 32,2 112,3 31,4 94,3 1,7 -16,0 appliances Machinery and electrical 49,3 232,0 51,1 212,6 23,6 91,0 22,3 57,9 -8,4 -36,4 appliances Telephony appliances 4,0 60,5 2,5 46,5 1,7 21,5 0,5 7,0 -23,1 -67,3 Machinery and mechanical or 125,9 515,8 126,4 501,2 55,8 203,4 53,7 152,2 -2,8 -25,2 electrical appliances Motor vehicles; tractors 102,4 188,7 105,2 197,7 52,1 101,1 45,9 72,6 4,7 -28,1 Passenger vehicles 0,0 62,9 0,0 68,5 0,0 33,3 0,0 27,6 9,0 -17,3 Vehicles for freight transport 0,0 50,1 0,0 48,8 0,0 23,7 0,0 16,0 -2,6 -32,6 Transport equipment 120,6 212,6 115,2 220,0 56,8 110,6 48,1 76,5 3,5 -30,8 Non-oil imports 7632,4 3232,3 9291,6 3637,0 4486,3 1720,8 3561,0 1405,8 12,5 -18,3 Grand Total Imports 8173,2 3405,2 10011,1 3856,9 5205,8 1940,7 3561,0 1405,8 13,3 -27,6 Source : MINFI 5.1.2. Geographical orientation of trade
In 2019, the European Union remained Cameroon’s main trading partner, with 31.5% of total trade in value, against 35.5% in 2018. It is followed by: East Asia (23.9%), West Africa (11.8%), South-East Asia (5.8%), North America (4.9%), Eastern Europe (3.6%) and CEMAC (3.5%). The weight of trade dropped with the European Union (-4 percentage points) and East Asia (-0.3 point). Conversely, it increased with North America (+0.9 point), West Africa (+3.5 points) and CEMAC (+0.3 point). Graph 15: Breakdown of Trade Total by Geographical Area in 2019 (in %)
Source : MINFI In 2019, the European Union remained the main export destination, with 30.7% of the total sales, against 43.9% in 2018. It was followed by East Asia (25.5%), CEMAC (6.6%), South- East Asia (4.0%) and West Africa (2.1%).
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Graph 16: Breakdown of Exports by Geographical Area in 2019 (in %)
Source : MINFI
In 2019, the European Union remained Cameroon’s leading supplier, with a weight of 30%, followed by East Asia (21.3%), West Africa (17%), South-East Asia (6.5%) and Eastern Europe (5.4%). Purchases from CEMAC accounted for 1.4% of the total.
Graph 17: Breakdown of Imports by Geographical Area in 2019 (in %)
Source : MINFI 5.1.2.1. Trade by geographical area
European Union In 2019, the European Union remained Cameroon’s leading trading partner (leading customer and supplier). Cameroon’s trade deficit with the EU widened by 324 billion to stand at 424.2 billion. This trend is attributable to an increase in imports (+129 billion), coupled with a fall in exports (-193 billion).
The main products exported to the European Union are: crude petroleum oils (472 billion), raw cocoa beans (218 billion), raw aluminium (55.5 billion), fresh bananas (20 billion), liquefied natural gas (13.9 billion), cocoa paste (22.2 billion), raw rubber (11.2 billion) and robusta
84 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW coffee (8.9 billion). The main products imported are: machinery and mechanical appliances (126 billion), clinker (53.6 billion), pharmaceuticals (60 billion), motor vehicles and tractors (55.8 billion), used clothing (30.9 billion), dairy products (27 billion), wheat and meslin (48 billion) and flour and malt products (28 billion). East Asia In 2019, East Asia remained Cameroon’s second largest trading partner. It is the second largest supplier, with 21.3% of imports, and the second largest customer with 25.5% of exports. The deficit with this zone dropped by 24 billion to stand at 211.2 billion. This trend results from greater increase in exports (+76 billion) than in imports (+52.5 billion). Trade with China accounted for 74.1% of East Asia’s export earnings and 75.6% of import spending. These weights are down by 7 points compared with 2018. Exports to East Asia consisted mainly of crude petroleum oils (276.7 billion), liquefied natural gas (118.4 billion) and raw cotton (91 billion). The countries of this region supply the following products to Cameroon: vehicles (97.6 billion), insecticides, fungicides, herbicides (31.6 billion), tyres (23.5 billion), frozen sea fish (19.4 billion) and medication (12 billion). South-East Asia In 2019, South-East Asia became Cameroon’s fourth leading partner (fifth largest customer and fourth largest supplier). The trade deficit widened to 157.2 billion in 2019, from 63 billion in 2018. This trend resulted from a larger drop in exports (-184 billion) than in imports (-88 billion). The main products exported to this zone are: crude petroleum oils (149.3 billion), raw cocoa beans (62 billion) and raw cotton (52 billion). The main products imported are: rice (200 billion) and pharmaceuticals (37.4 billion). West Africa In 2019, West Africa remained Cameroon’s third leading partner (sixth largest customer and third largest supplier), with 2.1% of exports and 17% of imports. Cameroon’s deficit with the region doubled, compared with 2018, to stand at 606.9 billion, in connection with imports of fuels and lubricants from Togo. Nigeria remained the leading partner in this region, with 38% of total trade. Exports to this country accounted for half of the area, against 34.6% in 2018. Imports from the country weighed 37% against 45.9% in 2018. Togo is Cameroon’s second leading partner in this region, with 36% of total trade. The main products exported to the region were: household bar soap (13.5 billion); sawn timber (14.8 billion); beverages and alcoholic liquids (6.3 billion). Imports from West Africa concerned: fuels and lubricants (301.1 billion); crude petroleum oils (219.8 billion); frozen sea fish (65.6 billion); cigarettes (6 billion); palm oils (5.5 billion) and bitumen cokes (3 billion). North America In 2019, North America maintained its position as Cameroon’s fifth leading trading partner (fourth largest customer and seventh largest supplier), with 6% of total exports and 3.9% of total imports. Cameroon’s trade deficit with the region reduced considerably compared with
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2018 to stand at 5.3 billion, in connection with the surplus generated with the United States (+40.6 billion). Exports included: crude petroleum oils (101.3 billion); raw cocoa (17.2 billion); sawn timber (10.8 billion); and natural rubber (9.1 billion). The main products imported were: wheat and meslin (30.2 billion); machinery and mechanical appliances (26.5 billion); and fuels and lubricants (6 billion). CEMAC In 2019, CEMAC ranked seventh among Cameroon’s trading partners (fourth largest customer), with 6.6% of total exports and 2% of imports. The trade balance was in surplus of 105.2 billion, including 63.9 billion with Chad, 41.1 billion with the Central African Republic, 10.2 billion with Gabon and 2.5 billion with the Republic of Congo. The trade balance recorded a deficit of 12.5 billion with Equatorial Guinea. The main products exported to the region were: crude petroleum oils (28.2 billion), household bar soap (14.3 billion) and iron bars (12.1 billion). The main products imported were: liquefied butane (28.8 billion) and crude palm oil (9.7 billion). Table 55: Trends in Goods Trade by Geo-economic Area in 201 9 (in billions) Exports Imports Trade balance Item % variation % variation Values Values Values compared with 2018 compared with 2018 Southern Africa 3,8 21,5 47 -39,9 -43,2 South Africa 2 11,1 43,7 -18,7 -41,7 East Africa 1,3 722,3 0,3 -54,5 1 West Africa de l'Ouest 50,1 -4,5 657 52,7 -606,9 Côte-d'Ivoire 2,7 -33,6 53,2 13,4 -50,6 Guinea 0,2 -58,9 24,5 ND ND Mauritania 0,4 622,8 56,6 27,7 -56,2 Nigeria 25,5 39,9 241,7 27,2 -216,2 Senegal 15,1 -11,9 13,6 2,7 1,5 Togo 0,8 -76,7 253,5 152,5 -252,7 North Africa 3,6 195,0 119,7 3 811,5 -116,1 Egypt 1,1 -4,2 43,5 -3,1 -42,4 Morocco 1,1 113,9 46,1 186,5 -44,9 North America 144,3 9 507,9 149,5 427,9 -5,3 Canada 0,9 -98,5 41,7 -68,6 -40,8 United States of America 140,2 27 002,2 99,6 922,6 40,6 South America 25,6 905,3 83,7 -10,1 -58,1 Argentina 10,4 10 474,0 36,8 29,9 -26,4 Brazil 14,7 685,5 32,9 -42,1 -18,2 South-East Asia 94,6 -55,0 251,9 -20,2 -157,2 Indonesia 32,7 37,5 13,8 41,7 18,9 Thailand 0,7 -1,9 184,6 28,5 -183,8
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Exports Imports Trade balance Item % variation % variation Values Values Values compared with 2018 compared with 2018 East Asia 610,9 -9,1 822 3,3 -211,2 China 440 -16,1 621,9 -1,1 -181,9 South Korea 0,3 -2,3 61,2 9,0 -60,9 Japan 15,2 2 190,5 68,1 4,9 -52,9 Vietnam 53,9 -16,7 18,8 157,6 35,1 CEMAC 158,3 15,4 53,2 27,9 105,2 Gabon 23.5 -8.5 13.4 152.4 10.2 Equatorial Guinea 9.9 32.3 22.5 43.6 -12.5 Central African Republic 41.2 33.2 0 -100.0 41,1 Republic of Congo 17.7 0.7 15.1 -11.5 2.5 Chad 66 19.0 2.1 40-7 63.9 Eastern Europe 11,3 -39,9 206,9 19,6 -195,6 Turkey 11 -40,3 120,1 63,1 -109,1 Middle East 12,9 13,2 77,6 9,1 -64,7 United Arab Emirates 4,7 -37,3 42,8 2,4 -38,1 European Union 733,4 -20,0 1 157,6 15,8 -424,2 Belgium 64,2 -14,7 220 106,7 -155,8 Spain 32,3 -74,0 101,6 17,3 -69,3 France 74 -49,6 311,6 10,8 -237,6 Italy 292 0,9 87,9 0,6 204,1 The Netherlands 226,1 10,2 133,5 -18,8 92,6 Source: MINFI
5.1.2.2. Bilateral trade
5.1.2.2.1. Major partners
In 2019, China maintained its position as Cameroon’s leading trading partner, with 17.7% of total trade. It was followed by: France (6.4%); Italy (6.3%), the Netherlands (5.9%); Belgium (4.7%); Nigeria (4.4%); Togo (4.2%); the United States (3.9%); Thailand (3.0%) and Spain (2.2%).
5.1.2.2.2. Major customers
In 2019, China was Cameroon’s largest customer, followed by the Netherlands, Italy, India, the United States and France. China, Italy and the Netherlands maintained their 2018 rankings (1st, 2nd and 3rd respectively). The United States and Chad joined the list of top ten customers. Exports fell in particular to China (-84.2 billion), France (-72.8 billion), Germany (-14.2 billion), Vietnam (-10.7 billion) and Gabon (-2.1 billion). They increased towards India (+147.3 billion), the United States (+80.7 billion), Portugal (+29.1 billion), the Netherlands (+20.9 billion), Chad (+10.5 billion) and the Central African Republic (+10.3 billion).
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Table 56: Cameroon’s Major Customers 2018 2019 Item Shares of Exports Rank Shares of Exports Rank China 24,8 1 18,4 1 The Netherlands 9,7 3 12,9 2 Italy 13,7 2 12,2 3 India 5,5 6 11,0 4 United States 5,9 5 Spain 5,9 5 5,7 6 France 6,9 4 3,1 7 Bangladesh 3,3 8 3,0 8 Chad 2,8 9 Belgium 3,6 7 2,7 10
Source: MINFI China Trade balance with China was in deficit of 181.9 billion. Cameroon exported to China 25% of its crude oil, 39.7% of liquefied natural gas, 46.5% of raw timber and 13.5% of sawn timber. Italy Trade balance with Italy was in surplus of 204.1 billion. Products exported included crude petroleum oils (20.9%), aluminium (84.8%), wooden veneer sheets (55.1%) and sawn timber (8.6%). The Netherlands Trade balance with the Netherlands was in surplus of 92.6 billion. Cameroon exported 67.8% of its cocoa beans and 9.3% of crude petroleum oils to the Netherlands. United States Trade balance with the United States recorded a 40.6 billion surplus. Cameroon exported 10.1% of crude petroleum oils, 39.0% of cocoa paste and 6.1% of sawn timber to the United States. France Trade balance with France showed a 237.6 billion deficit. Cameroon exported 93.2% of cocoa butter and 5.7% of sawn timber to France. Table 57: Trends in the Major Products Exported to Major Customers (in billions) Value 2019 Variation % of Product Country Exported Goods Value 2018 (a) (b) in % b/a Exported in 2019 Crude petroleum oils 375,1 249,6 -33,5 25,0 Natural liquefied gas 54,7 104,0 90,3 39,7 Raw timber 58,8 39,9 -32,2 46,5 China Sawn timber 21,8 22,7 3,8 13,5 Wooden veneer sheets 4,6 6,0 31,0 25,4 Other products 9,2 17,9 94,6 Total exports to China 524,1 440,0 -16,0 18,4
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Value 2019 Variation % of Product Country Exported Goods Value 2018 (a) (b) in % b/a Exported in 2019 Raw cocoa beans 154,7 195,8 26,6 67,8 Crude petroleum oils 27,1 93,9 246,4 9,3 The Netherlands Other products 23,3 17,9 -23,2 Total exports to the 205,1 307,6 50,0 12,8 Netherlands Crude petroleum oils 189,6 208,5 9,9 20,9 Aluminium 53,5 48,1 -10,1 84,8 Wooden veneer sheets 13,9 13,0 -6,7 55,1 Italy Sawn timber 15,0 14,5 -3,4 8,6 Other products 17,4 8,0 -54,0 Total exports to Italy 289,5 292,0 0,9 12,2 Crude petroleum oils 61,8 149,3 141,7 14,9 Natural liquefied gas 49,2 97,0 97,1 37,0 India Raw cotton 1,3 14,3 989,3 11,0 Other products 4,2 3 -28,6 Total exports to India 116,5 263,6 126,3 11,0 Crude petroleum oils 104,4 136,0 30,2 13,6 Liquefied natural gas 0,0 13,3 5,1 Espagne Sawn timber 7,1 8,0 13,9 4,8 Other products 13 11 -15,4 Total exports to Spain 124,5 168,4 35,2 7,0 Petroleum oils 101,3 10,1
United States Cocoa paste 16,6 17,2 3,8 39,0 of America Sawn timber 8,4 10,2 22,0 6,1 Other products 34,5 11,5 -66,7 Total exports to the USA 59,4 140,2 135,8 5,8 Sawn timber 36,5 38,4 5,3 22,9 Banana 17,6 16,1 -8,5 66,0 Belgium Other products 21,1 9,7 -54,0 Total exports to Belgium 75,2 64,2 -14,6 2,7 Cocoa butter 19,6 31,9 62,8 93,2 Natural liquefied gas 12,8 0,0 -100,0 France Sawn timber 8,9 9,5 7,5 5,7 Other products 105,5 32,6 -69,1 Total exports to France 146,7 74,0 -49,6 6,1 Raw cotton 66,1 67,0 1,3 51,5 Other Products 4,0 5,2 30,0 Bangladesh Total exports to 70,1 72,2 2,9 2,9 Bangladesh Source : MINFI
5.1.2.2.3. Major suppliers
In 2019, China remained the leading supplier (16.1% of import spending), while France was second (8.1%). They were followed by Togo (6.6%), Nigeria (6.3%), Belgium (5.7%) and Thailand (4.8%). Turkey entered the list of top ten suppliers. Imports increased with Belgium (+113.6 billion), Togo (+137.7 billion), Nigeria (+51.7 billion), Thailand (+40.9 billion),
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Taiwan (+12.9 billion), India (+9.1 billion) and Gabon (+8.1 billion). Purchases decreased with the United States (-33.1 billion), Brazil (-23.9 billion), Great Britain (-19.6 billion), Malaysia (-14.6 billion) and China (-6.8 billion). Table 58: Cameroon’s Major Suppliers 2018 2019 Item Share in Imports (%) Position Share in Imports (%) Position China 18,5 1 16,1 1 France 8,3 2 8,1 2 Togo 3,4 7 6,6 3 Nigeria 5,6 3 6,3 4 Belgium 3,1 9 5,7 5 Thailand 4,2 5 4,8 6 The Netherlands 3,8 4 3,5 7 India 3,4 8 3,2 8 Turkey 3,1 9 United States of America 3,9 6 2,6 10
Source: BEAC / MINFI 5.2. Balance of Payments In 2019, the current account deficit worsened, but the level of external financing remained high to maintain the overall surplus balance and accumulate reserve holdings. The overall balance surplus remained almost stable at 155.7 billion, after 155.4 billion recorded in 2018. Table 59: Overall Balance of Payments from 2015 to 2019 (in billions) Item 2015 2016 2017 2018 2019 2020* I- CURRENT BALANCE -694 -613 -540,8 -777,6 -992,0 -1336,4 1- Goods balance -220 -136,8 -117 -295 -431,6 -1017,9 2- Services balance -403 -350,9 -285,7 -324,3 -361,6 -229,3 3- Primary income balance -258,3 -330,6 -384,5 -410,8 -493,8 -305 4- Secondary income balance 187,4 205,2 246,4 252,5 295,0 215,8 II- EXTERNAL FINANCING 1226 -203,1 776,8 947,5 1102,8 1373,7 1- Non-banking private sector 363 -571 256,2 -81,1 349,7 451,1 Foreign Direct Investments (FDI) 377,5 416,5 459,1 364,6 527,1 599,5 Portfolio investment and derived financial proceeds -25,9 -45,1 14,2 5 5,0 -34,2 Net drawings (excluding FDI and PFI) 9,6 -942,4 -217 -450,7 -184,3 -114,2 Acq / disposal of unproduced non-financial assets 1,8 0 0 1,8 1,8 0 2-Public administration 904 438,2 850,8 975,8 873,1 851,7 Project grants (including C2D) 58,2 58,2 65,6 85,9 133,3 102 Net drawings on bonded loan 442,4 40 0 -14,4 0,0 0 Net drawings (excluding Treasury bonds) 403,4 340 785,2 904,3 739,8 749,7 3- Deposit money banks -40,6 -70,4 -360,2 52,8 -120,1 70,9 III- ERRORS AND OMISSIONS -49,5 -8,2 -19,8 -14,7 -7,4 0 IV- OVERALL BALANCE 483 -824,5 216,2 155,4 155,7 37,3 V- BALANCE FINANCING -483 824,5 -216,2 -155,4 -155,7 -37,3 Source: MINFI, * Projections
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5.2.1. Balance of current account transactions
Current account deficit deteriorated to stand at 992 billion (4.4% of GDP), against 777.6 billion (3.6% of GDP) in 2018. The deterioration was generated by the balances of goods, services and primary incomes. Secondary income balance recorded a surplus. In 2020, the current account deficit could worsen by 344.4 billion to stand at 1 336.4 billion.
Graph 18: Current Account Balance Trends from 2015 to 2020 (in billions)
Source: BEAC / MINFI
5.2.1.1. Balance of goods
The goods deficit widened to 431.6 billion, after 295 billion in 2018. This trend is the result of an increase in import expenditure (+489 an increase of 13.3% in exports to 2392.8 billion, driven by higher hydrocarbons sector revenue. Oil revenues increased by 15.9%, due to the strong growth in domestic production. Natural gas, a new export product, generated revenue worth 262 billion, after 125 billion in 2018. Imports increased by 13.3% to stand at 3856.9 billion. This trend is attributable to the increase in purchases of fuels and lubricants (+53.1%), cereals, including rice (+60.9%), crude petroleum oils (+27.2%), clinker (+30.7%) and vehicles and tractors (+5.8%).
5.2.1.2. Balance of services
The services trade deficit widened to 361.6 billion, after 324.3 billion in 2018. This trend is attributable to the widening deficit in “transport” (-48.4 billion) and “insurance” (-3.1 billion), mitigated by the reduced deficits in “travel” and the accumulation of “other services”.
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Table 60: Balance of billions (in services ) Variations (in 2015 2016 2017 2018 2019 Item milliards) (a) (b) (c) (d) (e) (e-d) Services balance -403 -351 -285,7 -324,3 -361,6 -37,3 Transport -261 -204 -144,6 -179,9 -228,4 -48,4 including Passengers -87,4 -117,9 -110,7 -97,7 -121,9 -24,2 Freight -208,4 -132,8 -98,3 -137,9 -191,7 -53,9 Other transport 34,8 47,0 64,5 55,7 85,3 29,6 Travel -70 -65,7 -65 -56,8 -55,5 1,3 Business -18,7 -48 -43,6 -41,9 -48,9 -7,0 Personal -51,2 -17,7 -21,4 -14,8 -6,6 8,2 Insurance -42,2 -47,8 -38,9 -42,4 -45,5 -3,1 including: Freight insurance -33,0 -35,9 -29,2 -34,0 -39,4 -5,4 Life insurance 1,0 -2,6 -2,6 -3,3 -2,7 0,5 Other insurance 13,2 11,8 15,0 16,1 17,2 1,1 Other services -29,8 -33,4 -37,2 -45,2 -32,2 13,0 Communication services 37,8 36,4 33,1 35,3 25,8 -9,5 Other services to businesses -126,4 -129,8 -146,5 -154,1 -124,3 29,8 including Technical assistance -45,3 -43 -67 -79,7 -95,2 -15,5 Construction services -54,5 -54,9 -53,0 -62,1 -69,5 -7,5 Private services nec* 48,4 45,2 51,4 47,0 36,5 -10,5 Services provided or received by 10,5 14,8 24,8 26,6 29,8 3,2 Gov’t
Source: MINFI, * not classified elsewhere.
5.2.1.2.1. Transport
Transport deficit worsened to 228.4 billion, from 179.9 billion in 2018. This deterioration is mainly attributable to the widening freight and passenger transport deficits. Freight deficit increased by 53.9 billion, in connection with the increase in imports of goods; that of passenger transport increased by 24.2 billion, following the difficulties faced by CAMAIR-CO. Surplus in “other transport” improved by 29.6 billion to stand at 85.3 billion, reflecting the increase in revenue obtained from foreign port and airport transport companies.
Revenue from carriage of passengers and freight, and various services provided to foreign companies increased by 23.6 billion to stand at 395.4 billion. Expenditure on foreign companies amounted to 623.8 billion, representing an increase of 72 billion.
5.2.1.2.2. Travel
Travel deficit narrowed by 1.3 billion compared with 2018, to stand at 55.5 billion. Itwas generated by “business travel” (-48.9 billion) and “personal travel” (-6.6 billion). Travel revenue rose by 18% to stand at 382.9 billion. Travel expenditure amounted to 438.4 billion.
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In 2019, France was Cameroon’s leading customer in terms of travel, for which it provided 42.7% of revenue. It was followed by CEMAC (29%), Nigeria (8.8%), the United States (4.9%) and Ireland (3.2%). In CEMAC, Equatorial Guinea was the largest customer with 57.4% of revenue, followed by Gabon (20.8%), Congo (13.4%) and Chad (7.3%).
Graph 19: Breakdown of Travel Revenue by Area of Origin in 2019
Source: BEAC / MINFI
5.2.1.2.3. Insurance Insurance deficit worsened by 3.1 billion compared with 2018, and stood at 45.5 billion. It was mainly generated by “freight insurance”. “Life insurance” deficit fell to 2.7 billion while surplus in “other insurance” improved by 1.1 billion to stand at 17.2 billion. 5.2.1.2.4. Other services “Other services” includes communications services, other services provided to enterprises, private services not elsewhere classified and services provided or received by government services. Their deficit reduced to 32.2 billion, after 45.2 billion in 2018. These trends resulted from the reduction in the deficit of “other business services”, dominated by “technical assistance” and “construction services”. 5.2.1.2.3. Balance of primary income Primary income includes workers’ salaries, investment income and other primary income (taxes on production and imports, subsidies, rents, etc.). In 2019, balance of primary income showed a deficit of 493.8 billion, after 410.8 billion in 2018. This is attributable to the increase in profits paid by local subsidiaries of foreign companies, as well as to the increase in interest paid on external public debt. 5.2.1.2.4. Balance of secondary income Secondary income consists mainly of current transfers. Surplus in secondary income balance rose to 295 billion, after 252.5 billion in 2018. This is attributable to the increase in diaspora remittances, as well as remittances from foreign governments. Remittances from the diaspora amounted to 377.1 billion, after 344.1 billion in 2018. They came mainly from France, with 33.7% of the total, followed by CEMAC (12.3%), the United
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States (11.5%), Great Britain (11%), Ireland (8%), Germany (6%) and Italy (2%). Remittances from CEMAC mainly came from Equatorial Guinea (33.6%), the Central African Republic (32.5%), Gabon (22.3%) and Congo (8.1%).
Graph 20: Breakdown of Migrant Remittances by Area of Origin in 2019
Source : MINFI
5.2.2. External financing In 2019, external financing increased by 155.3 billion to stand at 1 102.8 billion. This im- provement stemmed from: (i) increased financing from the non-banking private sector; and (ii) budgetary support obtained under the economic and financial programme.
5.2.2.1. External financing from the non-banking private sector
In 2019, external financing by the non-banking private sector resulted in net inflows of 349.7 billion, against net outflows of 81.1 billion in 2018. This was mainly due to the reduction in capital outflows of 266.5 billion in respect of net drawings, and the increase in the flow of foreign direct investments of 162.5 billion. Portfolio investments recorded stable net inflows of around 5 billion
5.2.2.2. External financing of the public sector
In 2019, public sector external financing recorded net inflows of 873.1 billion, down by 102.7 billion compared with 2018. This was mainly due to a 165 billion reduction in go- vernment drawings. Net external financing of the public sector consists mainly of project grants (133.3 billion) and net drawings on ordinary loans (739.8 billion).
5.2.2.3. External financing of the banking sector
In 2019, external financing of the banking sector recorded outflows of 120.1 billion, against inflows of 52.8 billion in 2018. These changes correspond to the increase in net foreign assets of commercial banks in relation to: (i) claims on foreign banks and financial institu- tions and other non-resident entities; (ii) equity and investment securities; and (iii) deposits from non-resident customers.
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5.2.3. Balances of payments by sector
In 2019, the overall balances of the “agriculture”, “forestry”, “hydrocarbons extraction” and “transport” sectors were in surplus. Other sectors (industry, commerce, telecommuni- cations, finance) posted deficits.
5.2.3.1. Agriculture
In 2019, agriculture recorded an overall surplus balance of 684.7 billion, showing an increase of 103.5 billion compared with 2018. The current account surplus increased by 46.9 billion, driven mainly by raw cocoa beans and raw cotton exports, which increased by 55 billion and 11 billion respectively. Services balance deficit worsened from 103.1 billion in 2018 to 107.9 billion in 2019. Primary and secondary income showed a deficit of 3.7 bil- lion and 0.2 billion respectively. External financing showed a surplus of 4.7 billion, against a deficit of 52 billion in 2018.
5.2.3.2. Logging
In 2019, the overall balance showed a surplus of 256.5 billion, although down by 6.3 bil- lion compared with 2018. Current account surplus fell by 26.3 billion to 249.7 billion, in connection with the drop in rough timber exports. Deficits in services and primary income remained almost stable. External financing resulted in net inflows of 6.8 billion, against net outflows of 13.2 billion in 2018. They were made up of 13.8 billion in foreign direct investments and 7 billion in net drawings on loans.
5.2.3.3. Hydrocarbons extractions
In 2019, overall balance surplus improved by 378 billion to stand at 990.4 billion. This is attributable to higher sales of crude oil and liquefied natural gas. The current account was in surplus of 380.6 billion, after the 697.9 billion recorded in 2018. This surplus resulted from transactions on “goods” (1,191.6 billion) and on “secondary income” (24.1 billion). External financing deficit contracted by 2.6 billion and stood at 88.1 billion. That of prima- ry income worsened by 8 billion to stand at 119 billion.
5.2.3.4. Industry
In 2019, overall balance deficit widened by 85.5 billion to stand at 1599.4 billion, as a re- sult of a worsening current deficit not offset by the increase in external financing. Current deficit increased by 229.3 billion to stand at 1.835.2 billion, following the deterioration of its various items. The goods deficit widened by 206.6 billion and stood at 1470.6 billion, in connection with the increase in inputs and capital goods imports. Services and primary income showed a deficit of 237.5 billion and 123.6 billion respectively. Net external finan- cing increased by 143.8 billion to stand at 235.8 billion due, among other things, to the increase in foreign direct investment.
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 95 MINISTRY OF FINANCE
Table 61: Balance of Payments by Sector (in billions) ITEM AGRICULTURE LOGGING OIL INDUSTRY YEAR 2018 2019 2018 2019 2018 2019 2018 2019 I- CURRENT BALANCE 633,1 680,0 276,0 249,7 697,9 1 078,5 -1 605,9 -1 835,2 1- Goods balance 736,4 791,7 280,3 255,2 805,8 1 191,6 -1 264,0 -1470,6 2- Services balance -103,1 -107,9 -3,9 -4,0 -14 -19 -232,0 -237,5 3- Primary income balance -1,0 -3,7 -0,2 -1,5 -111 -119 -106,9 -123,6 4- Secondary income 0,7 -0,2 -0,2 0,0 16,5 24,1 -3,0 -3,6 balance II- EXTERNAL -52,0 4,7 -13,2 6,8 -85,5 -88,1 92,0 235,8 FINANCING 1- Non-banking private -52,0 4,7 -13,2 6,8 -85,5 -88,1 92,0 235,8 sector Foreign Direct 0,0 3,4 0,2 13,8 100,4 22,1 89,3 206,9 Investments (FDI) Portfolio investment and derived financial proceeds. 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 (PFI) Net drawings (excluding -52,0 1,3 -13,4 -7,0 -185,9 -110,2 2,7 28,9 FDI and PFI)
3- Deposit money banks 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0
OVERALL BALANCE 581,2 684,7 262,8 256,5 612,4 990,4 -1 513,9 -1 599,4 Source: BEAC/MINFI 5.2.3.5. Trade, restaurants and hotels
In 2019, overall balance deficit widened by 211.1 billion to stand at 1,128.2 billion. This worsening deficit is attributable to the balance of goods (-1 104.2 billion), services (-168.9 billion) and primary income (-23.1 billion).
5.2.3.6. Transport
Current account surplus fell by 74.9 billion compared with 2018, and stood at 99.8 bil- lion. This trend resulted from the reduction in the services surplus to 219.4 billion, after 239 billion in 2018 and the worsening primary income deficit of 53.4 billion. Goods and secondary income balances posted respective deficits of 24.6 billion and 2.9 billion. Ex- ternal financing amounted to 60.4 billion. It consisted of FDI flows of 71.8 billion and net drawings of 11.4 billion. All transactions in the transport sector resulted in a surplus of 160.2 billion, down by 30.7 billion compared with 2018.
5.2.3.7. Telecommunications
In 2019, the current account deficit fell by 26.5 billion compared with 2018, to stand at 65.8 billion. This is mainly attributable to the goods balance, whose deficit fell by 17.2 billion, and to the services balance, whose surplus improved by 8.7 billion. External finan-
96 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW cing recorded net inflows of 3.7 billion, after 17.5 billion in 2018. It is essentially made up of foreign direct investment flows. Overall balance was in deficit of 62 billion, showing a reduction of 12.7 billion.
5.2.3.8. Financial activities In 2019, the current account stood at 3.5 billion, recording a reduction of 15.5 billion com- pared with 2018, as a result of changes in the balance of primary income (+13.1 billion), services (+2.8 billion) and secondary income (+1.6 billion). External financing flows dropped from a 90.2 billion surplus to a 53 billion deficit, mainly due to net outflows of 122.3 billion from deposit money banks. Overall financial sector balance fell from a 71.2 billion surplus in 2018 to a 56.5 billion deficit in 2019, mainly due to the deterioration in the balance of external financing flows. Table 62: Balance of Payments by Sector (in billions) ITEM TRADE TRANSPORT TELECOM FINANCE YEAR 2018 2019 2018 2019 2018 2019 2018 2019 I- CURRENT BALANCE -1007,6 -1269,5 174,8 99,8 -92,2 -65,8 -19,0 -3,5 1- Goods balance -875,4 -1104,2 -23,1 -24,6 -124,7 -107,4 -22,4 -24,4 2- Service balance -137,3 -168,9 239,0 219,4 34,7 43,4 48,9 51,7 3- Primary income balance -20,0 -23,1 -38,6 -92,1 -1,2 -0,6 -51,9 -38,8 4- Secondary income balance 25,1 26,7 -2,6 -2,9 -1,1 -1,1 6,4 8,0 II- EXTERNAL FINANCING 90,5 141,3 16,2 60,4 17,5 3,7 90,2 -53,0 1- Non-banking private sector 90,5 141,3 16,2 60,4 17,5 3,7 37,4 69,3 Foreign Direct Investments (FDI) 84,1 91,3 17,4 71,8 18,0 4,6 37,5 59,6 Portfolio investment and derived 0,0 0,0 0,0 0,0 0,0 0,0 5,0 -0,1 financial proceeds IPIF) Net drawings (excluding FDI 6,4 50,0 -1,3 -11,4 -0,5 -0,9 -5,2 9,8 and PFI)
3- Deposit money banks 0,0 0,0 0,0 0,0 0,0 0,0 52,8 -122,3 III- OVERALL BALANCE -917,1 -1128,2 190,9 160,2 -74,7 -62,0 71,2 -56,5
Source: BEAC/MINFI 5.2.4. Bilateral balances of payments In 2019, the overall situation of bilateral balances recorded a deficit with Nigeria (-253 bil- lion) and China (-59.5 billion). Conversely, it recorded a surplus with France (175 billion), the United States (94.3 billion), CEMAC (800.1 billion) and the European Union (232.1 billion). 5.2.4.1. Nigeria The overall balance recorded a deficit of 253 billion, down from the 279.7 billion in 2018. This resulted from a higher increase in net external financing than in the current account deficit. The current account deficit increased from 245.6 billion to 260.8 billion. The goods deficit widened to 157.6 billion, in connection with the increase in crude oil imports. Defi-
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 97 MINISTRY OF FINANCE
cits in services stood at 75.4 billion, those of primary income at 23.2 billion and secondary income at 4.6 billion. Financing resulted in net inflows of 7.8 billion, after net outflows of 34 billion recorded in 2018.
5.2.4.2. China The overall balance recorded a deficit of 59.5 billion, but reduced by 193.5 billion com- pared with 2018. This trend resulted from an increase in public borrowing greater than the worsening current account deficit. The current account deficit widened by 91.6 billion to stand at 302.2 billion, in connection with the drop in crude petroleum oils and raw tim- ber exports. Services, primary and secondary incomes showed a deficit of 72 billion, 76.6 billion and 2.1 billion respectively. External financing remained dominated by net public administration drawings, which amounted to 285 billion, after 80.4 billion in 2018.
5.2.4.3. United States Overall balance with the United States recorded a surplus of 94.3 billion, after a deficit of 48.1 billion, due to an improved current account balance which recorded a 53 billion from a 63.2 billion deficit, in connection with the increase in hydrocarbons exports. Balance of services recorded a surplus of 2.9 billion, and that of primary income a deficit of 54.8 billion, due to dividends paid for direct foreign investments. Secondary income balance remained in surplus of 38.1 billion, mainly driven by remittances from the diaspora. Finan- cing resulted in net inflows of 55.3 billion, consisting mainly of foreign direct investments. Table 63: Balance of Payments with Nigeria, China and the United States (in billions) ITEM NIGERIA CHINA UNITED STATES YEAR 2018 2019 2018 2019 2018 2019 I- CURRENT BALANCE -245,6 -260,8 -210,6 -302,2 -63,2 38,8 1- Goods balance -120,3 -157,6 -3,3 -151,6 -62,1 52,7 2- Services balance -99,2 -75,4 -99,1 -72,0 10,0 2,9 3- Primary income balance -26,1 -23,2 -99,5 -76,6 -53,4 -54,8 4- Secondary income balance 0,0 -4,6 -8,7 -2,1 42,4 38,1 II- EXTERNAL FINANCING -34,1 7,8 90,1 242,7 15,1 55,5 1- Non-banking private sector -34,0 6,8 12,3 -42,3 15,3 55,3 Foreign direct investments (FDI) -32,0 6,6 24,2 -48,1 24,2 36,7 Portfolio investment (PFI) and derived 0,0 0,0 0,0 0,0 0,0 0,0 financial proceeds Net drawings (excluding FDI and PFI) -2,0 0,3 -11,9 5,8 -8,8 18,6 2-Public administration 0,0 0,0 80,4 285,0 0,0 0,0 Project grants (including C2D) 0,0 0,0 0,0 0,0 0,0 0,0 Net drawings on bonded loan 0,0 0,0 0,0 0,0 0,0 0,0 Net drawings (excluding Treasury bonds) 0,0 0,0 80,4 285,0 0,0 0,0 3- Deposit money banks -0,1 1,0 -2,6 0,0 -0,3 0,3 III- OVERALL BALANCE -279,7 -253,0 -120,5 -59,5 -48,1 94,3 Source: BEAC/MINFI
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5.2.4.4. France The overall balance showed a surplus of 175 billion, after 79 billion in 2018. This trend is the result of a simultaneous improvement in the current account and financial transactions balances. Current account deficit reduced by 28.9 billion to stand at 165.1 billion, mainly due to the fall in foreign investment income. Goods deficit worsened to 182 billion, after 94.3 billion, in connection with the increase in imports. Services and primary incomes showed a deficit of 36.8 billion and 65.6 billion, respectively. Secondary income remained in surplus at 119.3 billion. Financing generated net inflows of 340.1 billion, after 273.1 billion in 2015, in connection with the increase in public administration net drawings. 5.2.4.5. CEMAC Overall balance surplus stood at 800.1 billion, representing an increase of 28.7 billion compared with 2018. The current account contributed 739.2 to billion the surplus. Goods surplus increased and stood at 466.9 billion. Balance of services surplus stood at 251.1 billion, while the primary income deficit was 21.7 billion. The secondary income balance remained in surplus and stood at 42.9 billion, representing an improvement of 1.3 billion compared with the previous year. 5.2.4.6. European Union The overall balance surplus stood at 232.1 billion, almost stable compared with the 234.1 billion recorded in 2018. The current account deficit widened to 157.1 billion, due to the de- terioration of the goods and services balances. The goods balance recorded a 77.8 billion de- ficit, after several years of surplus, in connection with the increase in imports from the zone. The services deficit stood at 119.4 billion, due among other things to the increase in freight expenditure. The primary income balance deficit stood at 99 billion, while the secondary inco- me balance surplus stood at 139.1 billion. External financing amounted to 389.2 billion, and consisted of net inflows from the non-banking private sector (262.9 billion), net drawings from the public administration (111.7 billion) and net inflows from the banking sector (14.6 billion).
Table 64: Balance of Payments with France, CEMAC and the European Union (in billions)
ITEM FRANCE CEMAC European Union YEAR 2018 2019 2018 2019 2018 2019 I- CURRENT BALANCE -194,1 -165,1 745,8 739,2 -44,0 -157,1 1- Goods balance -94,3 -182,0 453,9 466,9 28,8 -77,8 2- Services balance -6,2 -36,8 260,0 251,1 -38,2 -119,4 3- Primary income balance -203,5 -65,6 -9,7 -21,7 -220,4 -99,0 4- Secondary income balance 109,9 119,3 41,6 42,9 185,8 139,1 II- EXTERNAL FINANCING 273,1 340,1 25,5 60,9 378,1 389,2 1- Non-banking private sector 66,1 245,4 12,0 49,8 46,7 262,9 Foreign Direct Investments (FDI) 193,9 203,0 3,0 48,3 205,6 222,5 Portfolio investment (PFI) and derived 0,0 0,0 4,8 0,0 0,0 0,0 financial proceeds Net drawings (excluding FDI and PFI) -127,7 42,5 4,2 1,6 -158,8 40,4 2- Public administration 195,6 83,3 -14,4 -11,3 321,8 111,7 Project grants (including C2D) 85,9 17,3 0,0 0,0 85,9 19,8 Net drawings on bonded loan 0,0 0,0 -14,4 0,0 0,0 0,0 Net drawings (excluding Treasury bonds) 109,7 66,0 0,0 -11,3 235,9 91,9 3- Deposit money banks 11,4 11,3 27,9 22,4 9,6 14,6 III- OVERALL BALANCE 79,0 175,0 771,4 800,1 334,1 232,1 Source: BEAC/MINFI REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 99 MINISTRY OF FINANCE
5.2.5. Monthly balance of payments for the first half of 2020
Monthly balance of payments shows all the transfers made during the month as part of sett- lement of economic transactions made with the outside world. In the first six months of the 2020 fiscal year, the cumulative current account deficit widened to stand at 723.1 billion, against 342.3 billion in the first half of 2019, due to the worsening goods balance deficit following the onset of the COVID-19 pandemic.
Table 65: Monthly Balance of Payments for the First Half of 2020 (in billions)
Jan.June Item Jan. Feb. March April May June Jan.June 2020 2019 1- Goods balance 13,5 -214,0 -153,8 -136,1 -67,7 -165,0 -723,1 -342,3 2- Services balance 50,7 -195,0 -120,0 -101,2 22,7 -82,2 -425,0 -196,1 3- Primary income balance -15,9 -24,5 -26,5 -17,9 -34,7 -33,2 -152,7 -104,9 4- Secondary income balance -40,2 -7,6 -19,3 -41,1 -68,3 -55,2 -231,7 -154,8 II- EXTERNAL FUNDING 18,9 13,1 12,0 24,2 12,5 5,6 86,3 113,5 1- Non-banking private sector 61,4 163,2 114,3 73,0 61,6 84,6 558,1 560,2 Foreign Direct Investments (FDI) 87,4 61,1 6,2 63,0 15,8 52,6 286,1 210,5 Portfolio investments 90,3 67,0 15,0 102,0 67,0 11,0 352,3 0 Net drawings 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0 2-Public administration -2,9 -5,9 -8,8 -39,0 -51,2 41,6 -66,2 210,5 Project grants (including C2D) -13,0 42,1 69,7 22,2 12,9 13,1 147,0 267,1 Net drawings on bonded loan 0,2 1,8 4,3 1,5 2,4 0,4 10,6 23,4 Net drawings 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0 3- Deposit money banks -13,2 40,3 65,4 20,7 10,5 12,7 136,4 243,7 III- ERRORS AND OMISSIONS -13,0 60,0 38,4 -12,2 32,9 18,9 125,0 82,5 IV- OVERALL BALANCE 2,6 2,0 -1,1 -1,6 -0,9 5,4 6,4 3,3 V- BALANCE FINANCING 77,5 -48,8 -40,7 -64,6 -7,0 -75,0 -158,6 224,3 1- Goods balance -77,5 48,8 40,7 64,6 7,0 75,0 158,6 -224,3 Source: BEAC/MINFI The cumulative balance of goods deficit stood at 425 billion; the services and primary income balance deficits stood at 152.7 billion and 231.7 billion respectively. With the exception of January and May, the balance of goods showed a deficit over the first six months, while services and secondary income balances posted a deficit over the period. The cumulative secondary income showed a surplus of 86.3 billion, down by 27.3 bil- lion, in connection with the fall in diaspora remittances following the lockdowns in Wes- tern countries. Cumulative net external financing stood at 558.1 billion, which was almost stable com- pared with 560.2 billion in 2019. Financing of the non-banking private sector resulted in net inflows of 286.1 billion, while that of the public sector resulted in net inflows of 147 billion. The banking sector recorded net inflows of 125 billion, up from 82.5 billion in the first half of 2019. The various payments made with the outside world in the first half of 2020 showed an overall deficit of 158.6 billion, after a surplus of 224.3 billion recorded in the first half
100 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW of 2019. This deficit accumulated during the months of February (-48.8 billion), March (-40.7 billion), April (-64.6 billion), May (-7 billion) and June (-75 billion).
Table 66: Balance of Payments from 2014 to 2019 (in billions) ITEMS 2014 2015 2016 2017 2018 2019 I- CURRENT BALANCE (including -692,2 -693,9 -613,0 -540,8 -777,6 -992,0 Government transfers) CURRENT BALANCE (excluding -746,7 -736,5 -660,0 -591,6 -828,8 -1050,2 Government transfers) 1- Balance of goods -221,9 -220,0 -136,8 -117,0 -295,0 -431,6 FOB goods exports 3244,5 3085,6 2724,7 2674,9 2885,2 3238,3 including FOB customs exports 2557,9 2400,0 1959,7 1881,9 2112,3 1959,7 FOB goods imports -3466,4 -3305,6 -2861,5 -2791,9 -3180,1 -3670,0 including CIF customs imports -3747,3 -3575,0 -3087,4 -3054,3 -3405,2 -3087,4 2- Balance of services -310,2 -403,0 -350,9 -285,7 -324,3 -361,6 Transport -213,7 -261,0 -204,0 -144,6 -179,9 -228,4 - Passenger -82,3 -87,4 -117,9 -110,7 -97,7 -121,9 Revenue 16,8 15,5 1,4 10,4 29,0 16,1 Expenditure -99,1 -102,9 -119,3 -121,1 -126,7 -138,0 - Freight -164,9 -208,4 -132,8 -98,3 -137,9 -191,7 Revenue 239,3 212,2 236,0 253,1 262,5 272,2 Expenditure -404,2 -420,6 -368,8 -351,3 -400,3 -463,9 - Other transports 33,5 34,8 46,7 64,3 55,7 85,3 Revenue 44,9 47,2 49,8 77,7 80,4 107,1 Expenditure -11,4 -12,4 -3,1 -13,5 -24,7 -21,9 Insurance -34,0 -42,2 -47,8 -38,9 -42,4 -45,5 Revenue 35,4 31,1 33,7 34,8 37,2 38,3 Expenditure -69,4 -73,3 -81,5 -73,7 -79,6 -83,8 Travel -17,0 -70,0 -65,7 -65,0 -56,8 -55,5 Revenue 294,4 266,1 299,6 306,5 324,5 382,9 Expenditure -311,4 -336,1 -365,3 -371,5 -381,3 -438,4 Other services -45,5 -29,8 -33,4 -37,2 -45,2 -32,2 Revenue 372,1 324,5 362,6 437,0 453,1 478,0 Expenditure -417,6 -354,3 -396,1 -474,3 -498,3 -510,3 Including technical assistance and -79,0 -35,6 -37,0 -135,1 -142,4 -90,9 various services Revenue 205,1 154,6 167,3 175,0 175,1 220,7 Expenditure -284,1 -190,2 -204,3 -310,1 -317,6 -311,7 3- Revenue Balance -337,5 -258,3 -330,6 -384,5 -410,8 -493,8 Revenue 80,3 107,8 120,5 111,6 119,2 136,3 Expenditure -417,8 -366,1 -451,1 -496,1 -530,0 -630,1 Remuneration of employees -18,0 -19,9 -20,7 -21,0 -21,2 -22,0 Direct investments -326,3 -243,3 -251,1 -294,5 -337,8 -408,6 Portfolio investment -11,9 -12,4 -57,1 -59,6 -58,4 -60,3 Other investments -61,6 -90,5 -122,2 -121,0 -112,6 -139,3 Including interest on external public debt -59,5 -51,4 -92,1 -92,5 -111,0 -136,9
REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 101 MINISTRY OF FINANCE
ITEMS 2014 2015 2016 2017 2018 2019 4- Current Transfers 177,4 187,4 205,2 246,4 252,5 295,0 Private 122,9 144,8 158,2 195,6 201,3 236,8 Inflow 253,4 278,9 302,1 335,8 344,1 377,1 Outflow -130,5 -134,1 -143,8 -140,2 -142,8 -140,3 Public 54,5 42,6 47,0 50,8 51,2 58,2 Inflow 63,0 68,2 74,6 71,7 72,4 80,4 Outflow -8,5 -25,6 -27,6 -20,9 -21,2 -22,3 II- CAPITAL & FIN. 763,6 1179,3 -203,1 776,8 947,5 1142,4 TRANSACTIONS ACCOUNT 1- Capital Account 47,1 12,9 58,2 67,9 91,0 1,8 Government services 45,3 11,1 58,2 65,6 85,9 0,0 Including such grants as (HIPC, C2D, 45,3 11,1 0,0 0,0 MDRI) Other sectors 1,8 1,8 0,0 2,3 5,1 1,8 2- Financial transactions account 716,5 1166,4 -261,4 709,0 856,6 1140,6 Direct investments 364,2 377,5 416,5 459,1 364,6 527,1 Inflow 359,2 371,1 390,8 472,1 425,5 601,7 Outflow 5,0 6,4 25,7 -13,0 -60,9 -74,6 Portfolio investment -31,5 416,5 -24,5 14,2 -16,1 71,8 Assets (drop +) -21,0 -13,5 -20,5 37,7 -6,7 66,8 Commitments (drop -) -10,5 430,0 -4,0 -23,5 -9,4 5,0 Other investment 383,8 372,4 -653,4 235,7 508,1 541,6 Public administrations 484,0 403,4 340,0 785,2 904,3 739,8 including liabilities 484,0 403,4 340,0 785,2 904,3 739,8 -Drawings 554,5 486,0 453,0 919,7 1040,5 1060,1 -Depreciation -70,5 -82,6 -113,0 -134,5 -136,2 -320,3 Banks and financial institutions -67,7 -40,6 -51,1 -330,2 59,6 -134,6 Assets (drop +) -24,3 -71,9 -39,5 -387,1 74,2 -220,2 -Deposits 21,8 15,1 -36,9 -72,8 37,3 -39,5 -Other assets -46,1 -87,0 -2,6 -314,3 36,9 -180,7 Liabilities (drop -) -43,4 31,3 -11,5 56,9 -14,6 85,6 -Deposits -45,9 -7,2 -24,4 7,9 40,7 66,0 -Other liabilities 2,5 38,5 12,8 49,0 -55,3 19,6 Private non-banking -32,5 9,6 -942,4 -219,3 -455,8 -63,6 Assets (drop +) -1,5 -35,7 -988,9 -248,8 -481,4 -243,5 Liabilities (drop -) -31,0 45,3 46,5 29,5 25,7 179,9 III- ERRORS AND OMISSIONS -42,5 -2,4 -8,2 -19,8 -14,7 5,2 IV- OVERALL BALANCE 28,9 483,0 -824,5 216,3 155,4 155,7 V- FINANCDING -28,9 -483,0 824,5 -216,3 -155,4 -155,7 1- Official reserves variations (drop +) 43,9 -483,0 824,5 -216,3 -155,4 -155,7 IMF (net) 2,6 -13,3 -17,6 141,5 76,4 34,2 Transactions account (net) 171,3 -348,8 673,6 -1136,0 -368,6 -131,5 2- Special financing 0,0 0,0 0,0 0,0 0,0 0,0 Source: BEAC/MINFI
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CHAPTER 6: SOCIAL SECTOR Cameroon’s social development strategy aims to build human capital and improve the indicators of health, education, employment and participation in social life. The actions carried out focused on: (i) achieving universal education and enhancing professionalization; (ii) improving the health of the population; (iii) ensuring gender advancement and women’s empowerment; (iv) ensuring the social protection of vulnerable persons; (v) promoting youth employment; and (vi) developing low-cost housing. In 2019, 1 184.2 billion CFA francs was allocated to the social sectors, up by 17.4% compared with 2018. This amount, which represented 22.7% of the State budget, was further increased with multifaceted support from development partners supporting the Government in implementing its social policy. In 2020, the budget allocated to the sector stands at 1 219.8 billion, recording an increase of 35.7 billion. In the first half of 2020, following the outbreak of the COVID-19 pandemic which negatively affected all social sectors, the Government took measures to mitigate its effects. Such measures include: (i) in education, the closure of schools and universities and the reorganization of the school and academic year; (ii) in health, adapting the technical facilities of a number of hospitals for the free care of people affected by the pandemic, the setting up of specialized centres to care for patients as well as the procurement and distribution of materials to limit the spread of the virus. Many other measures were taken to limit the economic and social impact of the pandemic. 6.1. Education The objectives of Cameroon’s education system are to: (i) ensure access to quality education for all; (ii) adapt training and education to suit the socioeconomic environment in order to build a critical mass of human resources capable of supporting the productive system; and (iii) promote research and development. To achieve these goals, the sum of 672 billion was allocated to the education sector in 2019, representing 12.9% of the State budget. 6.1.1. Basic education In 2019, 222.3 billion was allocated to basic education, up by 5.6% compared with 2018. This amount was intended to finance activities aimed particularly at: (i) developing pre-school education; (ii) universalizing primary education; (iii) promoting literacy; and (iv) improving the working environment and living conditions of staff. In 2020, the budget allocated to the sector increased by 3.7 billion to stand at 226 billion. As part of the transfer of powers to Regional and Local Authorities, 80% of the resources of MINEDUB’s investment budget were reserved for the construction of school infrastructure, provision of literacy materials and the promotion of inclusive education. The National Council for the Approval of School Textbooks and Didactic Materials withdrew some textbooks like the book on the promotion of bilingualism, and merged others. The number of textbooks has thus changed from 11 to 3 in nursery school, from 11 to 7 in the Francophone sub-system of primary education, and from 8 to 6 in the Anglophone sub-system of primary education. The Cameroon Education Reform Support Programme (CERSP) plans to distribute textbooks over a three-year period starting from the 2020-2021 academic year, for an annual amount
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of 7.5 billion. This programme aims to improve the average textbook ratio per pupil, which is currently estimated at one textbook for 12 pupils. The target by the end of the programme is one textbook for two pupils. The subjects mainly concerned are French, English, Mathematics and Science. For the 2020/2021 academic year, there are plans to freely distribute 4 million textbooks in junior classes (SIL, CP, Class 1, Class 2) in 13 000 government primary schools. It should be noted that the Government distributes free textbooks each year in priority education areas. 6.1.1.1. Pre-school development In 2019/2020, the gross pre-school enrolment rate increased by 2.6 percentage points to 37.8%. This improvement can be attributed, among other things, to the gradual reopening of schools in the South- West and North-West Regions that have been affected by a security crisis. In addition, inadequate school infrastructure, especially in rural areas, limits the potential of this level of education. Actions carried out towards pre-school development focused on: (i) the construction and equipping of 15 community pre-school centres; (ii) the construction of 65 classrooms and 22 nursery blocks; (iii) the construction of 10 latrine blocks and 4 fences; (iv) the equipping of 18 nursery blocks and 24 classrooms; (v) the training of 6 000 new teachers for community pre-school centres; (vi) the training of 150 community preschool centre monitors and 400 management committee members in priority education areas on the use of new curricula and the production of teaching aids using local and recycled materials; and (vii) the distribution of 2 000 community-based pre-school strategy and policy documents. 6.1.1.2. Universalization of primary education The universalization of primary education is measured through two main indicators: the primary school completion rate and the net success rate. In 2018/2019, the primary school completion rate was 70.6%, down by 1.5 points compared with 2017/2018. The net success rate stood at 70%, down by 6.1 points. The decline in both indicators can be explained by the disturbances recorded in regions experiencing a security crisis. In 2018/2019, the universalization of primary education was pursued by: (i) increasing the provision of primary education; (ii) providing support for girl child education; and (iii) promoting national languages. To extend the school map and increase the provision of public primary education, Government’s actions focused, among other things, on: (i) the construction and equipping of 866 classrooms; (ii) the construction of 71 latrine blocks and 2 fences; (iii) the rehabilitation of 26 schools; (iv) the procurement and distribution of 18 180 desks and 54 specialized equipment kits; (v) the training of 1 522 teachers on new curricula and 476 on inclusive education; and (vi) the creation of 158 schools. The completion rate for girls in the last year of primary school is 66.8%, compared with 74.4% for boys. Efforts to keep girls in school continued through: (i) the training of 75 community- based organizations on educational monitoring of girls and vulnerable children; (ii) the training of the staff of three community radio stations per region on the techniques of raising awareness on the education of girls in priority education areas; and (iii) building the capacity of priority education area school officials in the practice of school hygiene.
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Regarding the promotion of national languages in primary schools, the actions carried out focused on: (i) the training of 2 860 teachers in the use of teaching guides for national languages and cultures; and (ii) building the capacity of 4 040 pedagogic supervisors and teachers on the use of teaching guides for personal development, national languages and cultures. 6.1.1.3. Literacy Literacy rate is the percentage of people who can read and write in a population. According to UNESCO, in 2018/2019 the literacy rate among people over the age of 15 in Cameroon was 77.1%. To increase access to a minimum level of education, the following actions were carried out: (i) 23 441 people were trained in formal literacy centres and non-formal basic education centres; (ii) 2 948 children aged 6-11 were taught to read and write; (iii) follow-up activities were organized in regional and local authorities to help update the literacy skills of actors in the administrative and education chain. 6.1.1.4. Improving the working environment of staff In 2018/2019, the improvement of the working environment of staff was pursued, particularly through: (i) the construction of 14 blocks of 2 housing units for teachers in rural areas; (ii) the construction and assignment of 2 051 staff offices in government primary schools; (iii) the construction of 4 divisional delegations (Faro et Deo, Mayo-Tsanaga, Mbam et Kim, and Mvila) and 13 sub-divisional inspectorates of basic education. 6.1.1.5. Review of the 2018/2019 school year and results of the 2019/2020 school year During the 2018/2019 school year, basic education enrolment stood at 542 540 nursery school kids, up by 5.2% compared with 2017/2018. They were taught by 27 822 teachers, recording a 9.3% increase. There were 19 605 classrooms in 2018/2019, showing a 13.9% increase. In primary education, there were 4 399 897 pupils in 2018/2019, recording an increase of 5%. They were taught by 96 546 teachers, up by 3%. The number of primary school classrooms in 2018/2019 stood at 90 782, that is an increase of 10.6%. Table 67: Number of Functional Classrooms, Pupils and Teachers in Pre-school and Primary Education 2017/2018 2018/2019 Education Classrooms Teachers Pupils Classrooms Teachers Pupils Government 5 003 9 638 181 937 5 267 10 161 176 559 Pre- Private 11 915 15 469 318 790 13 940 17 102 348 902 school Community 296 355 15 198 398 559 17 079 Total 17 214 25 462 515 925 19 605 27 822 542 540 Government 50 322 56 386 3 214 310 52 176 56 749 3 342 412 Private 30 957 36 622 911 962 37 662 38 892 986 565 Primary Community 817 715 65 720 944 905 70 920 Total 82 096 93 723 4 191 992 90 782 96 546 4 399 897
Source: MINEDUB.
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In pre-school, the pupil/classroom ratio dropped from 30 in 2017/2018 to 28 in 2018/2019. The pupil/teacher ratio remained stable at 20 pupils per teacher. In primary education, the pupil- teacher ratio rose from 45 to 46 and the pupil/classroom ratio dropped from 51 to 48. Table 68: Pupil/Teacher and Pupil/Classroom Ratios in Nursery and Primary Education 2017/2018 2018/2019 Education Pupil/Teacher Pupil/Classroom Pupil/Teacher Pupil/Classroom Government 19 36 17 34 Private 21 27 20 25 Nursery Community 43 51 31 43 Total 20 30 20 28 Government 57 64 59 64 Private 25 29 25 26 Primary Community 92 80 78 75 Total 45 51 46 48 Source : MINEDUB. At the end of the 2019/2020 school year, results of examinations organized by MINEDUB show that the success rate at the “Certificat d’Etude Primaire” (CEP) dropped by 1.2 points to 76.6%. Conversely, the success rate at the First School Leaving Certificate increased from 86.8% in 2018/2019 to 92.5% in 2019/2020. 6.1.2. Secondary education In 2019, the budget allocated to the Ministry of Secondary Education stood at 387.6 billion, up by 6.1% compared with 2018. A 2.6 billion subsidy was granted to private secondary schools and teacher training colleges. Government’s policy in this area of education remains focused on: (i) increasing access to secondary education; (ii) improving the quality of education and life in schools; (iii) intensifying professionalization; and (iv) optimizing training. In 2020, the budget allocation increased by 4.8 billion to stand at 392.4 billion. In 2018/2019, the number of secondary schools fell from 4 131 to 4 127, compared with 2017/2018. This decrease was due to the closure of 62 illegal private colleges. It is worth noting that since 12 August 2020, the MINESEC school map grew with the creation of 66 new government schools, broken down as follows: 49 Government Bilingual High Schools, 16 Government Bilingual Secondary Schools and one Government Secondary School. In addition, 22 Government Bilingual Secondary Schools were upgraded to Government Bilingual High Schools with the opening of second cycles. Due to the outbreak of the COVID-19 pandemic in early 2020, changes were made to the school calendar and to the running of schools for the 2019/2020 and 2020/2021 school years. The modification of the 2019/2020 school calendar involved the closure of government and private schools from 18 March to 1 June 2020, while classes resumed exclusively for examination classes, in strict compliance with barrier measures (systematic wearing of masks, social distancing, etc.). The suspension of classes also led to the modification of the examination schedule, as examinations were organized later than initially planned. By way of illustration, the Baccalauréat Général examination, which was previously scheduled to run from 26 to 29 May 2020, was finally organized from 21 to 24 July 2020. The Probatoire examination, initially scheduled for 16 to 19 June 2020, was finally written from 3 to 7August 2020
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The 2020/2021 academic year, which was initially scheduled to begin on 7 September 2020, instead started on 5 October. The various school terms are organized as follows: (i) First Term, from 5 October to 23 December 2020; (ii) Second Term, from 4 January to 26 March 2021; and (iii) Third Term, from 6 April to 25 June 2021. Regarding the reorganization of secondary schools, measures were taken to protect students and teachers. Such measures include: (i) reducing the number of students to 50 per classroom; (ii) dividing the day into three shifts; (iii) continuing with school digitization and distance education. Strict compliance with barrier measures also remains compulsory for everyone. Table 69: Trends in the Number of Secondary Schools Type Category 2017/2018 2018/2019 General education 1 924 1928 Technical education 762 760 Mixed 1 1 Public GTTC 62 63 GTTTC 11 11 Total Government 2 760 2763 General education 810 827 Technical education 69 58 Mixed 386 376 Private GTTC 94 90 GTTTC 12 11 Total Private 1 371 1 364 Grand Total 4 131 4 127 Source : MINESEC.
6.1.2.1. Development of school infrastructure and equipment In 2019, infrastructure development actions mainly concerned: (i) the construction of 114 blocks each comprising 2 classrooms, 11 professional practical workshops in government technical colleges (GTC) and government technical high schools (GTHS), as well as fences around 4 schools; (ii) the completion of GTTC Edea and the two-storey teaching block in Government Bilingual Industrial and Commercial Technical High School Yaounde; (iii) the equipping of 122 professional practical workshops with teaching kits, 60 science laboratories with micro-science kits, 3 computer rooms, 214 classrooms with desks, 4 administrative blocks with office furniture and 39 schools with staff offices and chairs; and (iv) the reconstruction of infrastructure in 19 schools in the North-West and South-West Regions. 6.1.2.2. Improving the quality of education and life in school In 2019, the improvement of the quality of education and life in school continued through: (i) the implementation of 85 syllabuses (study programmes) in the “Première” class in general education; (ii) the development of a technical education training benchmark was developed and the production of 23 teaching guides; (iii) the training of 12 796 teachers and capacity building for 1 200 inspectors; (iv) the award of 1 028 academic palms to deserving teachers and 6 641 scholarships to deserving and needy students; and (v) the revision of 6 mathematics syllabuses in the Anglophone subsystem. REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 107 MINISTRY OF FINANCE
6.1.2.3. Intensification of professionalization and optimization of training Throughout the 2018/2019 school year, the Government continued efforts to intensify professionalization and optimize training along the following three main thrusts: (i) introduction of 3 new training fields in growth trades, namely renewable energy, industrial automation (application of automation and IT to industrial production processes) and transport/logistics; (ii) equipping of 5 continuing training centres and 7 automobile mechanics, metal construction, and jewellery workshops; (iii) experimental introduction of the entrepreneurship module in ten pilot technical schools in tertiary sciences and technology; (iv) placement of 900 teachers on refresher training in about one hundred companies nationwide. 6.1.2.4. Review of the 2018/2019 school year and 2019/2020 results During the 2018/2019 school year, enrolment in general secondary education stood at 1 459 682 students, divided into 39 377 classrooms, with 75 677 teachers. In technical and vocational education, there were 318 703 students in 10 494 classrooms, for 32 339 teachers. In teacher training, there were 17 368 student teachers, distributed in 1 035 classrooms, for 3 968 teachers. In general education, the student/classroom ratio dropped from 42.8 to 37.1 and the student-teacher ratio rose from 18.1 to 19.3. In technical education, these ratios dropped from 33.2 to 30.4 and from 13.3 to 9.9 respectively.
Table 70: Number of Students, Teachers and Classrooms in Secondary Education 2017/2018 2018/2019 Education Category Classrooms Teachers Students Classrooms Teachers Students Government 20 640 48 689 1 052 048 23 516 41 661 1 040 723 General secondary Private 13 847 32 646 424 168 15 861 34 016 418 959 Total 34 487 81 335 1 476 216 39 377 75 677 1 459 682 Government 6 202 16 594 258 692 8 022 23593 257 389 Vocational technical Private 3 702 8 070 69 690 2 472 8 746 61 314 secondary education Total 9 904 24 664 328 382 10 494 32 339 318 703 Government 500 2 113 11 616 510 1969 10 021 GTTC Private 469 1 012 3 517 294 1 025 2 469 Teacher Total 969 3 125 15 133 804 2 994 12 490 Training Government 153 683 6243 159 741 4602 GTTTC Private 134 204 514 72 233 276 287 887 6758 231 974 4878 Source : MINESEC With the exception of the Brevet professionnel industriel which recorded an 18.5 point improvement to stand at 83.6%, all official examinations of the 2020 session organized by the Office duBaccalauréat recorded a drop in success rates. The BAC-ESG recorded a success rate of 47.2% as against 60.5% in 2019. The success rate in the Probatoire ESG dropped by 12.6 points and stood at 31.2 % in 2020. The success rate in the Baccalauréat des sciences et technologie du tertiaire (STT) fell by 6.8 points to stand at 56.7%, while that of Probatoire STT fell from 58.2% in 2019 to 39.4% in 2020. As for the Bac EST, its success rate dropped from 63.5% to 56.7%. The success rate in the Brevet de technicien STT fell by 34.2 points to stand at 36.7%.
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With regard to examinations organized by the GCE Board, the success rate at the GCE Ordinary Level (General) improved by 7.4 points to stand at 69.6%, while that of the GCE Advanced Level (General) fell from 78.4% in 2019 to 64.1% in 2020. The results in examinations organized by the Department of Examinations, Competitive and Certificate Examinations (DECC) showed a success rate of 61.2%, as against 72.1% in 2019 at the BEPC ordinaire. The success rate at the BEPC bilingue stood at 83.4%, as against 90.4% in 2019. The success rate at CAP STT dropped by 12.9 points to stand at 46.7%. Table 71: Success Rates for Official Secondary School Examinations (in %) Examination 2019 Session 2020 Session Variations in absolute terms BEPC Ordinaire 72,1 61,2 -10,9 BEPC Bilingue 90,4 83,4 -7 CAP STT (Commerciaux) 59,6 46,7 -12,9 CAP Industriel 79,2 72,6 -6,6 CAPIEMP 92,6 91,5 -1,1 CAPIET 99,3 97,5 -1,8 Average for examinations organized by the DECC GCE-General, Ordinary Level 62,2 69,6 7,4 GCE-General, Advanced Level 78,4 64,1 -14,3 GCE-Technical, Ordinary Level 89,3 GCE-Technical, Advanced Level 67,1 Average for examinations organized by the GCE Board BAC-ESG 60,5 47,2 -13,3 BAC-EST industriel 61,4 60,6 -0,8 Brevet de TechnicienIndustriel 44,9 28,5 -16,4 BAC-STT commercial 63,5 56,7 -6,8 Brevet de Technicien STT (Commerciaux) 78,1 47,2 -30,9 Brevet Professionnel Industriel 65,1 83,6 18,5 Brevet Professionnel Commercial 33,3 28,6 -4,7 PROB-ESG 43,8 31,2 -12,6 PROB-EST industriel 59,1 34,6 -24,5 PROB de Brevet de Technicien Industriel 65,4 47,3 -18,1 PROB-STT Commercial 58,2 39,4 -18,8 PROB de Brevet de Technicien STT 70,9 36,7 -34,2 Average for examinations organized by the OBC Source: MINESEC. 6.1.3. Higher education In 2019, higher education was allocated 62.1 billion, representing 9.2% of the budget allocated to the education sector. The special appropriations account for the modernization of research in
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State universities was allocated 10.5 billion. In 2020, the budget allocation dropped by 5 billion to stand at 57.1 billion. In higher education, the gross enrolment rate is defined as the number of students enrolled in a given level of education, regardless of their age, expressed as a percentage of the population of the theoretical age group corresponding to the said level of education. The population used here is that of five consecutive years, starting with the secondary school completion age. In 2019, the gross enrolment rate in Cameroon was 13%. UNESCO sets the target of 15%, as the minimum rate capable of significantly transforming the socio-economic fabric of a country. The actions implemented to improve higher education opportunities focused on: (i) the professionalization of lectures; (ii) the modernization of universities and faculties; and (iii) the development of research and innovation. 6.1.3.1. Development of the technological and professional component In 2019, the technology sector put 14 695 graduates on the labour market, up by 35.6% compared with 2018. This increase is attributable to the expansion and diversification of training opportunities in the technological and vocational field. Agronomy and fisheries produced 1 964 graduates. Cultural and tourism industries placed 2 538 graduates on the job market. In the services sector, 9 283 skilled professionals were trained. To increase the number of skilled human and animal health personnel, 4 345 physicians and veterinarians were trained. In all, higher education produced 55 939 graduates, 75.5% of whom graduated from public institutions. 6.1.3.2. Modernization and professionalization of universities and faculties This programme seeks to further professionalize courses in all fields, with the ultimate goal of increasing the percentage of students enrolled in technological and professional fields from 13% to 25%. Actions carried out in this domain concerned: (i) the preparation of the draft instrument on sanctions applicable to private higher education institutions (IPES); (ii) the strengthening of the university and vocational information and guidance system by encouraging 23 500 students to choose accredited courses; (iii) the creation of 8 480 additional places, of which 1 700 in Douala, 280 in Bamenda, 1 000 in Buea, 1 000 in Yaoundé I, 500 in Dschang, 1 500 in Ngaoundere and 1 500 at the Cameroon-Congo Inter-State University, Sangmelima. 6.1.3.3. Development of university research and innovation The development of university research and innovation continued in 2019, particularly with: (i) the start of construction works on the Rectorate of the Pan-African University in Yaoundé; (ii) the finalization and publishing of the National Theses and Dissertations Database; (iii) the establishment of the second World Bank Centre of Excellence at the University of Buea; (iv) the production of the Laboratories and Research Centres Database; and (v) the organization of the third edition of the Cameroonian Student Genius and Talent Exhibition Show (GETEC).
6.1.3.4. Review of the 2018/2019 academic year During the 2018/2019 academic year, the number of public higher education institutions was as follows: a Cameroon-Congo Inter-State University, 8 State universities, 41 technological and professional institutions, 4 of which have special status, and 33 faculties. In the private sector, there are 285 private higher education institutes (IPES).
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The number of lecturers in State universities increased from 5 250 in 2018 to 6 332 in 2019, recording a 20.6% increase. Student enrolment rose from 323 672 to 361 478, up by 10.8%. Out of this number of students, 83.6% are enrolled in State universities and public institutions. In State universities, 302 037 students have 6 332 lecturers, for a student-to-lecturer ratio of 48. Table 72: Distribution of Students and Lecturers in Higher Education 2017/2018 2018/2019* University/Institution Lecturers Students Lecturers Students Total State University 269 509 5 250 298 531 6 332 University of Bamenda 16 294 659 19 332 795 University of Buea 17 896 584 18 675 704 University of Douala 49 543 758 55 784 914 University of Dschang 29 817 671 31 965 809 University of Maroua 23 741 508 29 632 613 University of Ngaoundere 24 101 640 26 068 772 University of Yaoundé I 58 617 953 62 124 1 150 University of Yaoundé II 49 500 477 54 951 575 Total Institutions with Special Status 2 966 3 506 Total IPES 51 197 59 441 Grand Total 323 672 5 250 361 478 6 332 Source: MINESUP * estimates
6.1.3.5. Prospects
Within the framework of the implementation of the Government’s digital development policy for the 2020-2021 period, MINESUP has signed a framework agreement with CAMTEL for the payment of bandwidth to the tune of 2.5 billion. In this agreement, CAMTEL undertakes to provide very high speed internet access of 9 334 megabits, as against 263 megabits previously. This will, among other things, help to: (i) make digital technology accessible to students in the 8 State Universities; (ii) operationalize the university digital development centres built by the Chinese side within the framework of the second component of the presidential e-learning project, in the 8 State Universities and the Cameroon-Congo Inter-State University; and (iii) operationalize the National Centre for the Supervision of the Interconnection Network of these centres and academic institutions.
Within the framework of the 2019-2021 Three-year Programme for the Recruitment of 2 000 Lecturers in State universities, 1 237 lecturers were recruited during the first phase. Out of these, 909 were jobless, 287 were employed in other trades and 46 from the diaspora. The second and third phases planned for 2020 and 2021 will make it possible to recruit 500 lecturers each. 6.2. Health In 2019, the sum of 206.7 billion was allocated to the Ministry of Public Health, representing 4% of the total budget. In 2020, this budget allocation stands at 234.5 billion, including 188.8 billion from the general budget and 45.6 billion from the special appropriation account (SAA) for Covid-19 control. It should be noted that the level of resources devoted to health is much higher. Actually, under the general budget, other ministries like the ones in charge of defence,
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education and social affairs also perform the health function. Similarly, under Covid-19 SAA, 58.7 billion was set aside only for strengthening the health system, of which 45.6 billion for the Ministry of Public Health and 13.1 billion for other ministries.
Government’s actions for the health of the population remained focused on: (i) maternal, child and adolescent health; (ii) disease control and health promotion; and (iii) development of health districts.
The year 2020 is marked by the onset of the COVID-19 pandemic in Cameroon, following its outbreak in China in December 2019 and its rapid spread around the world. To deal with the pandemic, the Government adopted some measures including: adapting the technical capabilities of several hospitals for free treatment of people affected by the pandemic; the setting up of specialized centres for the treatment of patients; the procurement and distribution of equipment to limit the spread of the virus.
6.2.1. Maternal and child health and immunization coverage
In this area, the Government’s main objective remains, among others, to reduce maternal, infant and child mortality. Against this backdrop, the Government continued to implement actions aimed at improving maternal and newborn health, as well as immunization coverage.
6.2.1.1. Maternal and child health
According to the Demographic and Health Survey (DHS) conducted in 2018, maternal mortality, which refers to the number of women who die during or within an interval of 42 days after childbirth, is 467 per 100 000 births. The mortality rates for children below 5 years of age by age group are as follows: 28 deaths out of 1 000 births for neonatal mortality (0-1 month); 48 deaths per 1 000 births for infant mortality (0-1 year) and 34 deaths per 1 000 births for child mortality (1-5 years). Overall, in the 0 to 5-year age group, the infant and child mortality rate is 82‰. Antenatal care coverage for women aged 15-49 years by trained staff is 87%. The number of women who went for postpartum check-up, within 48 hours of delivery, is 59%. The number of new-borns who were taken for postnatal consultation is 60%.
In 2019, the National Multi-sector Programme to Reduce Maternal, New born and Child Mortality (PLMI) continued with its actions to promote maternal, new born and child health. Its activities focused on construction, equipment, training and prevention.
Regarding the construction and equipping of health facilities, the following results were achieved: (i) the construction of 5 mother/child pavilions in the Holforth, Touloum, Santa, Matafal, Toubouro District Medical Centres (CMA), 2 maternity blocks in the Lobo CMA and the Balga Integrated Health Centre (IHC), and 2 paediatric blocks in the Esu and Bafmen IHCs; (ii) equipping the maternity wards of health districts and regional and central hospitals with 34 incubators; (iii) the construction of boreholes in the IHCs in the Far-North (15), North (15), Adamawa (5) Regions; (iv) the installation of solar panels in 20 IHCs, including 5 in the Far- North, 12 in the North and 3 in the Adamawa; (v) equipping health facilities with 2 600 delivery kits, 330 caesarean section kits and 230 obstetric fistula repair kits.
With regard to training, the results achieved focused on: (i) building the capacity of 938 midwives in family planning and on curricula in emergency obstetric and neonatal care; (ii) training of 471 community health workers in 5 regions (Adamawa, East, Centre, Far-North and North) on the treatment of simple malaria, diarrhoea and acute respiratory infections in
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In terms of prevention, 2 846 838 children between 6 to 59 months of age were given food supplements and 2 515 845 of them were dewormed. In addition, 85 531 children under the age of 5 suffering from acute malnutrition were treated in 67 health districts in 4 regions (Adamawa, Far-North, North and East). Expectant mothers continue to receive intermittent preventive malaria treatment and the tetanus vaccine free of charge during antenatal care visits.
6.2.1.2. Mother and child immunization coverage
Mother and child immunization coverage is carried out mainly through the Expanded Programme on Immunization. On the whole, immunization coverage dropped in 2019. The immunization coverage rates for the main tracer antigens decreased from 88% to 83% for BCG, from 79% to 78.2% for Penta3 and from 78% to 77% for IPV. Immunization coverage rates remained stable for RR and ROTA2 at 71% and 78% respectively. These trends could be attributed, among other things, to the: (i) insufficient delivery of immunization services; (ii) absence of children/parents during the rounds of health workers; (iii) reluctance of parents and an increase in cases of vaccine refusal in schools, especially in major towns; (iv) the security crisis in the North-West and South-West Regions which hampers the deployment of immunization teams. In addition, 3 086 521 children under the age of 5 were vaccinated through the measles prevention campaign, that is an immunization coverage of 92.4%.
For the year 2020, the projected target for immunization coverage rates for children aged 0 to 23 months, for Penta3 and RR, are higher than 90% and 85% respectively. However, during the first half of 2020, some difficulties were encountered in deploying immunization teams to the field due to COVID-19.
Table 73: Immunization Coverage Trends (%) Antigens 2016 2017 2018 2019 BCG 70 91 88 83 RR 78 77 71 71 VAT+2 58 72 VAA 78 78 74 70,7 Penta3 85 86 79 78,2 IVP 68 76 78 77 Rota2 79 83 78 78 Source: MINSANTE N.B: RR = Measles vaccine; VAT2 + = tetanus vaccine for pregnant women; VAA = yellow fever vaccine; Penta3 = combination of several antigens (Hepatitis B-Hib-DTP3); IPV = polio vaccine; Rota2 = Rotavirus vaccine
6.2.2. Epidemiological surveillance, disease control and health promotion 6.2.2.1. Epidemiological surveillance Thanks to epidemiological surveillance, the following number of cases were reported: (i) 613 cases of acute flaccid paralysis, including 607 cases in children under 15; (ii) 642 suspected measles cases, including 272 confirmed cases; (iii) 1 490 suspected cases of yellow fever, 1 458 of them confirmed; and (iv) 13 cases of maternal and neonatal tetanus. In addition, 2
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cases of circulating vaccine-derived poliovirus (cVDPV) were detected during environmental surveillance at the Kousseri and Mada sites. Response campaigns were organized in collaboration with Chad, where the cVDPV had been detected in the Mandélia health district. In the first half of 2020, patients were reluctant to go to health facilities for fear ofbeing contaminated with COVID-19. This led to a decline in the demand for and delivery of immunization services, posing a high risk of an epidemic. 6.2.2.2. COVID-19 The first COVID-19 positive case in Cameroon was reported on 6 March 2020. In order to protect the population, a response strategy was developed to check the spread of the disease. Consequently, on 17 March 2020, the Government adopted 13 measures to keep the novel coronavirus disease at bay, including the closure of borders, drinking spots and restaurants; observance of social distancing and hygiene rules. On 9 April 2020, these measures were reinforced in particular with the introduction of the systematic wearing of face masks. Since 30 April, some of the restrictions were eased considering the serious socioeconomic challenges the people found themselves in due to the outbreak of the pandemic. The 3T (trace, test and treat) strategy was adopted to contain the disease. It involves tracing contact persons, testing suspected cases and treating positive cases. To get healthcare services closer to the population, the Government’s COVID-19 Management Strategy has been decentralized, particularly by setting up care centres in the various regions. To care for patients, 102 screening sites, 15 laboratories, 190 health districts and 2 302 beds have been prepared. In addition, the Government procured 599 000 rapid diagnostic tests (RDTs), 257 respirators and oxygen concentrators, as well as other equipment (microwaves, freezers, masks, hydro-alcoholic gels, protective kits, etc.). A pandemic monitoring system has been set up with the main indicators being the number of confirmed cases, the number of deaths, the number of people who have recovered, the recovery rate, the case fatality rate and the bed occupancy rate. As of 27 August 2020, the epidemiological situation in Cameroon was as follows: (i) 19 142 confirmed cases, including 340 children of between 0-10 years of age, 76 pregnant women and 508 health workers; (ii) 411 deaths, for a case fatality rate of 2.1%; (iii) 17 651 people who have recovered, that is, a recovery rate of 92.2%; (iv) a bed occupancy rate of 6%. The early detection and patient care strategy is being pursued with the deployment of mobile caravans on the ground. 6.2.2.3. AIDS In 2019, the HIV prevalence rate was estimated at 3.1%, above the 2.7% recorded in 2018. The Government is pursuing its HIV/AIDS control policy based on prevention and patient care. Concerning prevention, the outreach strategy implemented through the “AIDS-Free Holidays” campaign organized during school holidays and the Cameroonian AIDS Control Month, helped 680 peer educators to hold 7 268 educative talks and 9 871 individual interviews. Similarly, 276 569 male and 8 077 female condoms were distributed. Within the framework of cooperation with technical and financial partners, the Government made available to health facilities and pharmacies: (i) 34 978 318 male condoms, compared with 46 686 574 in 2018; (ii) 3 401 584 female condoms, as against 5 291 710 in 2018; (iii) 4 791 302 lubricating gels, as against 1 159 602 a year earlier. Of the 737 161 pregnant women who went for their first antenatal
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consultation, 615 711 agreed to be tested for HIV, among whom 20 318 were found to be seropositive, that is, a seropositivity rate of 3.3%. Tests conducted on 28 691 partners of pregnant women who went for antenatal consultations revealed 1 102 positive cases, that is, a seropositivity rate of 3.8%. Of the 15 195 children exposed, born to HIV-positive mothers, early detection of HIV was carried out on 14 970 and 724 were diagnosed positive, that is a seropositivity rate of 4.8%, including 334 who are on antiretroviral treatment. Within the framework of care and according to the 2019 UNAIDS Report on Cameroon, out of the 424 421 people living with HIV, the active list of people on ARV therapy is 312 214 (73.6%), up by 11.3% compared with 2018. Among the 20 318 women declared HIV+, 84.5% are on antiretroviral therapy. The number of children under 15 years of age on ARVs is 10 405, representing 3.3% of the active list. Of the patients in the active list, a viral load test was conducted on 107 506 (34.4%) of them and 88% of these had a suppressed viral load. In view of the above results, the UNAIDS “90-90-90” target by 2020, which recommends that 90% of persons living with HIV should know their HIV status, 90% of HIV positive persons who know their status should be placed on antiretroviral therapy and 90% of people on treatment should have a suppressed viral load, is far from achieved. It should be noted that the ultimate goal is to eradicate HIV by 2030. In the first half of 2020, screening for HIV/AIDS covered 1 208 856 people in health facilities compared with 1 344 526 for the same period in 2019. This decrease is believed to be due to the application of lockdown measures. Of those screened, 37 106 were declared HIV positive, that is, an HIV-positive rate of 3.07%. In addition, 82 459 pints of blood were tested for HIV, of which 1 121 were found to be infected with HIV, that is a positivity rate of 1.36%. Of the 376 530 pregnant women who went for the first antenatal consultation, 328 342 were tested for HIV, among whom 10 183 were declared positive. The active list of persons on ARV therapy is 327 709. Graph 21: Trends in the Active List of People Receiving ARV Therapy
Source: MINSANTE 6.2.2.4. Malaria In 2019, Cameroon reported 2 628 191 malaria cases compared with 2 139 482 cases in 2018. The hospital mortality rate per 100 000 inhabitants was 17.7% compared with 13.1% in 2018. The number of malaria-related deaths in hospital is 4 510, of which 43.1% are under- five children and 2% are pregnant women. Malaria control is carried out mainly through the
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National Malaria Control Programme (NMCP) whose actions remain focused on prevention, diagnosis and treatment. Regarding actions to prevent the disease, out of the 638 299 pregnant women who went for consultation in health facilities, 309 999 were given the three doses of intermittent preventive treatment of sulfadoxinepyrimethamine free of charge. In addition, 8 409 093 long-lasting insecticidal nets (LLINs) were distributed, 380 437 of them to pregnant women in women in first antenatal care visit consultation. To prevent seasonal malaria in the North and Far-North Regions, 6 729 942 doses of amodiaquine sulfadoxinepyrimethamine were given free of charge to children aged 3 to 59 months. Regarding malaria diagnosis and treatment, 2 480 572 rapid diagnostic tests and 1 527 436 thick films were performed, for respective positivity rates of 61.7% and 71.9%. In addition, 465 699 children under the age of 5 with simple malaria and 385 670 others with the severe form were treated. In the population aged over 5 years, 1 372 155 cases of uncomplicated malaria and 1 256 036 cases of severe malaria were detected and treated. Health facilities received 1 001 575 doses of artesunate-amodiaquine, 894 217 doses of 60 mg artesunate injection and 5 161 032 doses of sulfadoxine + pyrimethamine for the treatment of patients. 6.2.2.5. Tuberculosis Tuberculosis control activities are implemented in all public and private health facilities which conduct screening for tuberculosis cases. There are 261 tuberculosis diagnosis and treatment centres, 11 of them specialized in the management of multidrug-resistant tuberculosis. In 2019, there were 24 740 cases of tuberculosis, including 24 535 cases of drug-susceptible tuberculosis and 195 cases of multidrug-resistant tuberculosis. The tuberculosis treatment success rate stood at 83%, up by 5 points compared with 2018. The number of reported cases is up by 4.2% compared with the 23 741 cases recorded in 2018. The number of tuberculosis cases per region is as follows: Adamawa (1 546), Centre, excluding Yaoundé(1 503), Yaoundé (3854), East (2006), Far North (3 549), Littoral, excluding Douala (747), Douala (4 681), North (2406), North-West (869), West (1 238), South (1220), South-West (1 121). Concerning drug-susceptible tuberculosis, all the 24 535 reported cases were placed on treatment. The number of drug-susceptible tuberculosis cases rose by 3.3% compared with 2018. Regarding multidrug-resistant tuberculosis, 169 out of the 195 cases reported were placed on treatment. The number of multi-resistant tuberculosis cases rose by 10.7% compared with 2018. During the mass tuberculosis screening operation carried out in 47 prisons, 133 tuberculosis cases were detected among the 4 303 prisoners who took the test. During the first half of 2020, there were 12 497 cases of all forms of tuberculosis, down by 6% year- on-year. Of the 1 246 children tested for TB, 154 were positive and 149 were placed on TB treatment. 6.2.2.6. Cancer In 2019, 15 700 new cases of cancer were detected in Cameroon. The epidemiological analysis of cancers in Cameroon shows that the most common forms in men are prostate cancer, liver cancer, Kaposi’s sarcoma, oesophageal cancer and non-Hodgkin lymphoma. In women, the most common forms are cervical cancer, breast cancer, liver cancer and Kaposi’s sarcoma. Likewise, the average age of cancer onset is 45 years for men and 49 years for women. The number of cancer-related deaths registered in the country was 10 533. As part of prevention, the campaign on breast cancer, organized in Ebolowa, helped to train 20
116 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW nurses in breast cancer screening, and detected 45 cases among the 91 women screened. In addition, 800 people were educated on rapid breast cancer screening methods, as part of educational talks. Regarding patient care, radiotherapy, which is used in 50% to 60% of patients, is predominant. Only 2 of the 3 radiotherapy centres are currently operational. Cancer screening, management and treatment fall under the oncology speciality. There are three types of treatment: surgery (surgeon oncologist), radiotherapy (radiotherapist oncologist) and chemotherapy (chemotherapist oncologist). There are 9 oncologists in Cameroon, including 3 surgeons and chemotherapists. The flat rate cost of radiotherapy is 180 000 CFA francs. The radiotherapy grant of 85 million was used to replace the cobalt-60 radiological source of the Douala General Hospital. During the first half of 2020, within the framework of actions to prevent and control cervical cancer (the second most common form of cancer in women), the National Cancer Control Committee helped train three trainers in colposcopy in India and strengthen the capacities of 25 resource persons. 6.2.2.7. Leprosy, yaws and buruli ulcer In 2019, 388 leprosy patients were receiving treatment, 152 of them new cases, and 66 health districts provided leprosy treatment. Regarding yaws, 2 920 cases were reported. This number is fast increasing due to the yaws epidemic reported in the Guere health district in the Far-North, which affected nearly 2 524 school children. The number of cases cured was 2 890, corresponding to a cure rate of 99%. Regarding buruli ulcer, there are 5 treatment centres specializing in the management of the disease: Akonolinga, Ayos, Bankim, Ngoantet and Ekondotiti. Concerning screening, 116 cases were detected and placed on treatment. Of this number, 106 patients have been cured, that is, a 91.4% cure rate. 6.2.2.8. Cholera In 2019, the cholera epidemic, which broke out in May 2018, persisted. In four of Cameroon’s ten regions (Far-North, North, Centre and Littoral), 2 000 cholera cases were detected, among which 100 deaths. Most of the dead lived in the northern regions: 31 in the Far-North Region and 62 in the North. 6.2.2.9. Onchocerciasis and lymphatic filariasis In 2019, as part of onchocerciasis control, treatment operations were organized in 12 215 communities exposed to the disease for a total population of 5 732 269 people. Through such operations, 15 085 501 Mectizan tablets and 6 780 512 Albendazole tablets were distributed in 94 health districts eligible for community-directed treatment with ivermectin (CDTI) Strategy. This action covered 74.4% of cases nationwide compared with 76.7% in 2018, due to a drop in coverage in the North-West and South-West Regions. In addition, 1 230 health workers were trained, including 136 specialized in the prevention and management of “serious side effects” of Mectizan use. Moreover, 31 930 community distributors were trained/retrained and 28 831 mobilized to distribute Mectizan. Regarding lymphatic filariasis, 24 302 cases were detected with 19 060 cases cured, for a 78.4% treatment success rate.
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6.3. Employment, Vocational Training and Social Security The Government’s employment and social security objectives remain geared towards the promotion of employment, the development of vocational training and the promotion of protection at work and social security. 6.3.1. Employment trends According to the estimates of the Ministry of Employment and Vocational Training (MINEFOP), 511 857 new jobs were created in 2019, that is an increase of 11.4% compared with 2018. The number of jobs created in the private sector represented 75.2% of the new jobs (384 942) and grew by 4.6%. The number of jobs created by employment sector institutions was 42 500 compared with 48 820 in 2018. Table 74: Distribution of Jobs Created from 2017 to 2019 Item 2017 2018 2019 Government services 96 173 91 469 126 915 Private sector, including: 377 130 368 094 384 942 NEF 59 000 48 420 42 050 PIAASSI 400 400 450 TOTAL 473 303 459 563 511 857 Source: MINEFOP In public administration, 126 915 jobs were created through various ministries and public establishments, compared with 91 469 in 2018. Of this number, 25 119 have effectively been entered in the payroll.
In 2019, the number of workers on the State payroll stood at 319 110, compared with 321 917 in 2018, that is a decrease of 0.9%. This trend is due particularly to the cleaning up of the payroll, following the Physical Headcount of State Personnel (COPPE), initiated in 2018 by the Government. The conduct of operation COPPE led to the removal from the payroll, among others, of duplicates as well as persons who were unduly receiving the reversionary pension, the incapacity pension and the temporary orphan’s pension.
Graph 22: Trends in the Number of State Personnel from 2010 to 2019
Source : MINFI
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Several actions were pursued to improve the labour market situation, deeply marked by an underemployment rate of over 70%, with a large predominance of the informal sector, which employs almost 90% of the active population. These actions aim to foster and promote full employment by expanding job creation opportunities in the economy. They are implemented through, among other things, employment promotion agencies, in particular the Integrated Support Project for Informal Sector Actors (PIAASI) and the National Employment Fund (NEF).
Through PIAASI, 245 micro-projects were funded to the tune of 379.6 million CFA francs, creating 450 direct and indirect jobs. The areas of activity concerned include auto mechanics, carpentry, welding, clothing, electricity, electronics, plumbing, agriculture, crafts, hairdressing and tanning. It also provided a 100 million self-employment start-up financial support to 55 Cameroonian migrants returning from the Mediterranean coast.
For its part, the NEF facilitated: (i) the integration of 42 050 people in wage-earning and self- employed jobs; (ii) the acquisition of funds for 777 people, including 108 in agriculture and livestock rearing, under the Support Programme for Rural Employment Development (PADER) and 660 under the Support Programme for the Professional Integration and Reintegration of Vulnerable Persons (PAIRPPEV); (iii) the training of 327 people and the placement on pre- employment internship of 173 young people through the Certificate-Based Employment Programme (PED). In addition, the NEF has set up the Cameroonian Immigrants Return Assistance Programme (PARIC), which aims to facilitate their socio-professional reintegration.
6.3.2. Vocational training
In 2019, actions carried out for the development of vocational training include: (i) the creation of various institutions; (ii) the diversification of vocational training services; (iii) improvement of the quantitative delivery of training; and (iv) improvement of the quality of training.
Regarding the creation of vocational training institutions, 275 private centres were approved, bringing the number of vocational training centres to 1215. In 2019, there were 41 225 trainees registered in all vocational training centres compared with 39 731 in 2018, that is, an increase of 3.8%.
Within the framework of the diversification of vocational training, 372 young people were awarded training grants, 255 of them by the Cameroon Government and 117 by foreign countries.
Concerning the improvement of the quantitative delivery of vocational training, 374 trainees were registered in the Douala, Limbe and Sangmelima Vocational Training Centres of Excellence, bringing to 574 the number of persons who acquired various skills in these institutions. The Government increased the number of places for the vocational qualification diploma examination in the 55 approved specialties to 3 200 compared with 3 018 in 2018.
As regards the improvement of the quality of vocational training, 6 skills-based approach vocational training standards were developed in the fields of mechatronics, automotive technical inspection, banking and finance, aquaculture, beekeeping, logistics and shipping. The number of candidates for examinations in the new specialties rose to 2247 after 1820 in 2018.
6.3.3. Promotion of social protection and security
In 2019, the Government’s policy in this domain aimed at ensuring quality social security in
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all sectors. It was implemented by: (i) promoting social security for the greatest number; and (ii) improving occupational protection.
6.3.3.1. Promoting social security for the greatest number
The promotion of social security aims to protect the entire population against social risks such as sickness, invalidity, old age, occupational accidents and a decline in the working age population. To this end, the actions implemented focused particularly on: (i) voluntary subscription to the insurance scheme of 40 socio-professional associations and 40 mutual assistance groups in the Littoral and West Regions; (ii) strengthening the operational capacities of promoters, managers and actors involved in the management of mutual assistance health insurance schemes, as a prelude to the establishment of universal health coverage; (iii) the signing of an agreement between the NSIF, mutual assistance groups and socio-professional associations on the social protection of their members. The agreement encourages informal and rural economy workers to embrace social protection.
In 2019, the social coverage rate was 22.7% of the working population, against 22.5% in 2018. This trend is due to the 45 485 new compulsory and 18 096 new voluntary subscriptions.
6.3.3.2. Improving occupational protection
In 2019, occupational protection continued through the maintenance of social peace in the work place and improved working conditions. These actions reduced the number of occupational accidents to 337 compared with 1 318 in 2018.
With regard to the maintenance of social peace, the activities carried out focused, among others, on: (i) drawing up of 8 940 conciliation reports; (ii) the award of 13 791 labour medals, in connection with the simplification of the award procedures; (iii) the signing of 4 professional agreements to improve the normative framework and working conditions; (iv) the defusing and lifting of 92 calls for strike action and protest in the context of maintaining a serene social climate.
As for improving working conditions, emphasis was placed on promoting the principles of health, safety and well-being in the workplace. Through this action, all companies and entities concerned are required to set up Health and Safety Committees (HSC). The HSC is an advisory body that plays an essential role in occupational health and safety. In 2019, there were 236 occupational health and safety committees established and installed, bringing the number of HSCs to 1500 between 2017 and 2019. In addition, 23 occupational medicine licences and 93 visiting and care delivery agreements were issued.
6.4. Town Planning and Housing In terms of town planning and housing, the Government’s policy remained focused on: (i) housing development; (ii) the sanitation of urban areas; and (iii) urban transport infrastructure development.
6.4.1. Housing development In 2019, actions to promote housing development continued through: (i) the Government’s programme for the construction of 10 000 housing units; (ii) the implementation of the housing component of PLANUT; and (iii) the Municipal Housing Programme (PCCM).
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Under the Government’s programme, the first phase of construction of 1 675 housing units in Yaoundé and Douala is continuing. In 2019, construction works on 40 social housing units was completed in Olembe (Yaoundé), bringing the overall number of housing units completed to 460, including 120 in Yaounde. In addition, construction works on the two sites of Olembe (Yaounde) and Mbanga-Bakoko (Douala) are in progress, with respective execution rates of 85% and 75%. This is also the case with the construction of the Fiftieth Anniversary Quarter in Douala, comprising 450 apartments, offices and shopping centres.
Under PLANUT, 500 social housing units and related infrastructure in Garoua (100), Maroua (100), Ngaoundere (100), Bafoussam (100) and Bertoua (100) have been completed and delivered. This brings the number of social housing units constructed under PLANUT to 600.
Table 75: PLANUT Social Housing Execution Rate in 2019 N° Town Execution rate in 2018 (%) Execution rate in 2019 (%) 1 Maroua 70 100 2 Garoua 65 100 3 Ngaoundere 95 100 4 Bertoua 70 100 5 Ebolowa 100 100 6 Bafoussam 68 100 7 Buea 62 62 8 Bamenda 30 30 Source: MINHDU
The Municipal Housing Programme, jointly funded by FEICOM and the Cameroon Housing Loans Fund (CFC), through a framework partnership agreement with the United Councils and Cities of Cameroon (CVUC), covers the construction of 592 social housing units in 24 councils, amounting to 10 billion. Works started in 2019 and is continuing in eight (8) councils. Table 76: Works Execution Rate in Various Councils N° Communes Number of housings Execution rate in 2019 (%) 1 Biyouha 12 80 2 Nguibassal 13 76 3 Guider 26 29 4 Bogo 20 10,64 5 Pete-Bandjoun 35 10,57 6 Penja 35 5 7 Ngoumou 28 5 8 Ngaoundere 1 24 2 Sources: Cameroon Housing Loans Fund and FEICOM 6.4.2. Environmental improvement and urban sanitation In 2019, environmental improvement and urban sanitation continued, in particular, with: (i) the management of rainwater, wastewater and solid waste; (ii) the beautification and security of urban centres; (iii) promotion of urban social development; and (iv) the enhancement of urban governance. For the management of rainwater and wastewater, 100.4 linear km of drains were completed out
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of the 120.4 km planned, that is, an execution rate of 90%. The completed works concern: (i) the completion of an additional 7.4 km of the 14 linear km of PADY 2; (ii) the construction of 470 ml of drains at the Warda crossroads in Yaoundé; (iii) the continuation of the rainwater drainage works in Douala, with an execution rate which rose from 57.5% in 2018 to 98% in 2019, over 42 linear km. Regarding solid waste management, HYSACAM, in partnership with 17 municipalities in which it operates, collected, transported and treated 1 430 624 tonnes of solid waste in 2019. At the end of June 2020, the tonnage collected, transported and treated stood at 718 438 tonnes. Concerning the beautification and security of urban centres, 27 093 m² of lawns were created and 601 public light points placed in 10 localities as follows: (i) 361 light points within the framework of resources transferred to councils, at a rate of 40 in Kaele, 42 in Mokolo, 106 in Batcham, 38 in Bangangte, 60 in Bazou, 43 in Mvengue and 32 in Idenau; (ii) 240 light points, through the C2D, including 100 in Garoua, 80 in Bafoussam and 60 in Bertoua. In 2019, actions to promote urban social development saw the training of 485 young people in petty city trades (production and laying of paving/cobble stones) in Mbengwi, Bamenda 3, Abong Mbang, Mboma, Guider, Garoua 1 and Limbe 3 councils. In each of the councils, a modern paving stone manufacturing unit was constructed and equipped. For urban governance, the National City Trades Training Programme (PNFMV) helped to build the capacities of 638 workers from 140 councils, including 10 Government Delegates, 46 mayors, 41 council secretaries and 551 technical staff. 6.4.3. Urban transport infrastructure development In 2019, actions to improve movement in towns continued, in particular with the maintenance, rehabilitation and construction of urban roads. Regarding the maintenance of urban roads, 76.5 km of roads were maintained out of the 127.5 km planned, for a completion rate of 60%. The maintenance carried out with PIB funding covered 49.5 km of earth roads and 6.6 km of tarred roads. Maintenance works were also done on 20.4 km of tarred roads under the Road Fund. Regarding the rehabilitation of tarred urban roads, 14.9 linear km were completed, including 11 km in Yaounde (Yaoundé-Nsimalen Airport Roundabout-Central Post Office-Messa- Multipurpose Sports Complex), 2 km in Barndake and 1.9 km in Garoua (Carrefour BEAC- Hôtel Benoue - CENAJES - Carrefour Mosquée). As part of the construction of urban roads, 6.9 km of access roads to the Olembe stadium were built. In addition, other works like those on the Yaoundé-Nsimalen Motorway (85% in 2018 to 90% in 2019) are continuing. In terms of the construction of structures, the works focused on the construction of 11 scuppers, 2 bridges, 1 retaining wall and 1 canal. 6.5. Social Affairs, Gender, Family and Youth Promotion Social development is based on the development of a social protection solidarity system ultimately aimed at strengthening the social role of the population, and eliminating social exclusion and all forms of vulnerability. In 2019, the Government continued with its actions focusing on: (i) providing social assistance and ensuring the socioeconomic integration of children in distress, socially maladjusted and marginalized people; (ii) empowering women and promoting the family; and (iii) providing guidance to youth.
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6.5.1. Social affairs The Government’s social affairs priority is geared towards the social inclusion of Socially Vulnerable Persons (SVPs), by empowering them. In this context, actions to improve the living conditions of vulnerable groups focused, among other things on: (i) promoting social prevention and protection; and (ii) promoting national solidarity while combating social exclusion. Following the outbreak of COVID-19, the Government developed a response plan amounting to 6.5 billion, for the treatment of SVPs. The objectives of the plan, among other things, are to: (i) conduct a socio-economic impact assessment of the virus on vulnerable households and persons, particularly in conflict-stricken zones; (ii) support people from areas most affected by the pandemic, through in-kind aid and money transfers; (iii) provide loan facilities to micro, small and medium-sized enterprises, especially those owned by women, youth and other vulnerable persons; and (iv) ensure the payment of retirement pensions through an electronic transfer system.
6.5.1.1. Social prevention and protection Actions to ensure the social protection of Socially Vulnerable Persons (SVP) were stepped up in 2019, following an uptick in alcohol, drug and other narcotics use, particularly by the unemployed, pupils and students. Social prevention and protection actions were pursued, among other things, by: (i) rehabilitating 6 buildings and the “Pavillon des Brebis” in the Centre Region; (ii) ensuring the safety of 13 abandoned children in orphanages; (iii) providing psychosocial support to 632 persons with disabilities suffering from some diseases and 34 005 refugee children; (iv) providing psychosocial support to the victims of the Ngouatche disaster, 10 405 internally displaced children and 8 005 SVPs. As at 27 August 2020, in a bid to curb the spread of COVID-19, some 102 street children were taken to their families and 43 others were placed in the Cameroon Child Welfare Institute Betamba (Institution camerounaise de l’enfance de Bétamba).
6.5.1.2. National solidarity and social justice Concerning national solidarity and social justice, the Government continued to implement actions organized around the “socially useful” concept, mainly focused on providing assistance and support as well as empowering SVPs. The actions carried out include: (i) training 20 social mediators to help change the behaviour of rural and city dwellers; (ii) providing material support to 702 SVPs to engage in Income-generating Activities (IGAs); (iii) identifying 489 new street children and re-socializing 249; (iv) assisting 116 572 SVPs in operational technical centres; and (v) ensuring the social integration of 8 families affected by the Ngouatche disaster. 6.5.2. Women’s empowerment and the family In this domain, Government’s strategy is particularly aimed at helping the people to meet their basic needs, enjoy their fundamental rights and provide for themselves. Priority actions in this area concern, among other things: (i) women’s empowerment and gender promotion; (ii) development of the family and protection of children’s rights. 6.5.2.1. Women’s empowerment and gender promotion In 2019, the actions carried out were geared towards promoting gender equality and equity, coaching women and young girls, and assisting refugee populations and internally displaced persons. Actions to promote gender equality and equity intensified with 4 467 308 people made to become aware of the existence of women’s empowerment and protection operational centres.
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In addition, 1987 women were taken care of in centres for women in distress. Capacity building sessions on peace and social cohesion were organized for female police officers, female gendarmes, female judicial personnel and those working in centres that attend to women who have suffered from gender-based violence. Concerning the coaching of women and young girls, actions continued within the framework of the “Support for Poor Women” project in Women’s Empowerment and Family Centres, through which 27 486 women and girls were trained on setting up and managing IGAs. To improve the working and living conditions of rural women, 839 women’s groups were provided with agricultural tools and inputs, 92 were granted micro-loans and 392 received financial support to establish IGAs. With regard to refugee populations and internally displaced persons, the “Second Chance Education and Vocational Learning” programme, piloted by the United Nations over the 2018-2021period in six countries including Cameroon, aims to develop context-specific learning and employment, to empower the most disadvantaged women and girls. Since its inception, 1267 women and girls have been trained and provided with start-up kits, particularly for tailoring, animal husbandry and petty trade, as well as agricultural tools and inputs.
6.5.2.2. Promotion of the family and protection of children’s rights In a context marked by the existence of several factors that undermine family cohesion and stability, the activities carried out focused mainly on: (i) providing assistance to 3 326 displaced families; (ii) training of 2176 widows in project development and creation of income-generating activities (IGAs); (iii) supporting the celebration of 2 507 collective marriages; (iv) producing 2 436 birth certificates; (v) training 170 adolescent group leaders for better prevention of violence, child marriage and risky behaviour; and (vi) providing assistance and relief to 2 938 destitute and needy families to the tune of 132 million.
6.5.3. Youth guidance and national integration In 2019, the government’s strategy remained focused on the notion of “educational governance”. It seeks to ensure youth moral rearmament for optimum management of the material and financial resources granted to boost their activities. The actions carried out include: (i) youth civic development and social integration; and (ii) youth economic empowerment.
6.5.3.1. Civic education and youth integration Given growing anti-social conduct, immorality and threats to the essential values of peace, work, solidarity and tolerance, it is necessary to promote civic education. The actions carried out focused on training and promotion of volunteering. Regarding training, 1400 community mediators were trained on topics related to popular and civic education, 23 monitors on group movements, as well as 550 young people on the values of living together. In addition, 29 807 people took part in moral rearmament activities. Regarding the promotion of volunteering, the actions carried out to get the youth interested in activities of community interest and volunteering focused on: (i) the creation of 30 volunteering clubs; (ii) the recruitment of 766 pioneer volunteers and the deployment of 435 of them in the fields of education, health and agro-pastoral agriculture. 6.5.3.2. Youth economic empowerment In this domain, the Government secured the economic integration of youth in 2019, notably by: (i) upgrading skills, guidance and assistance for 91 298 young people, bringing to
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141 321 the number of youth trained in Multipurpose Youth Empowerment Centres (MPYECs), 8 637 of them engaged in an economic activity; (ii) assisting 2770 young business promoters in creating their own businesses; and (iii) pursuing the construction of 9 Multipurpose Youth Empowerment Centres (MPYECs).
6.6. Fight againt Poverty: Social Safety Nets Social safety nets are well-targeted, generally non-contributory cash transfer programmes, which are part of the inclusive growth policy and help to assist people living in extreme poverty. Ultimately, they are expected to contribute to the establishment of a national social protection system for the poor through three programmes: (i) an ordinary money transfer programme (OMT), together with supporting measures; (ii) an emergency cash transfer programme (EMT); and (iii) a labour-intensive public works (LIPW) programme. In 2019, under the ordinary money transfer programme, the sum of 2.8 billion was transferred to 19500 households. Through the labour-intensive public works programme, 27 micro-projects were implemented in Benue Division, including 14 in Basheo and 13 in Dembo. An amount of 234 million was transferred to the 3 000 workers who took part in the implementation of these projects.
Table 77: List of Projects Executed in 2019 under the Labour-Intensive Public Works Programme
Basheo Dembo Microproject Village Micro-project Village 1. Maintenance of the Poukata - Naro 1. Sanitation work in Dembo Poukata, Naro Dembo town rural road (10 km) town 2. Maintenance of two 2. Maintenance of the Naro - Naro; Tchikare reforested areas of 7 ha and 4 Dembo Tchikare rural road (10 km) ha in Dembo 3. Maintenance of the 3. Maintenance of the Ourohamayel - Ourohamayel, Djatoumi Djamboutou Issa - Badjeroum Djatoumi Douane rural road (15 km) Djatoumi Douane Junction, Timpil road (7 km) Djamboutou 4. Maintenance of the Karewa - Ouro Douane, 4. Maintenance of the Séboré Daledjé, Badjabou rural road (10 km) Badjabou - Dembo road (12 km) Badjeroum, Laïnddé, Issa, 5. Maintenance of the Daram - Daram, Kerzeng, 5. Sanitation works in Séboré, Dembo Rognou rural road (07 km) Rognou Dornomou village 6. Maintenance of the Daram - 6. Sanitation works in Daram, Tchome Dornomou Tchomé rural road (12 km) Mboutou village 7. Maintenance of the Daram - Daram, Djarengol, 7. Sanitation works in Mboutou Gourou rural road (07 km) Gourou Babessa and Louga villages 8. Sanitation works in Baonia 8. Maintenance of the Dorba - Dorba, Harkou Djallou, Ouro Kessoum II Babessa, Louga Harkou rural road villages 9. Maintenance of the Pengou - 9. Sanitation works in Balde BaoniaDjallou, Pengou, Harkou GaouGadourou rural road Danedji village OuroKessoum II 10. Construction of fifteen 10. Maintenance of the Manawassi Manawassi, (15) stone bays in Sourou and BaldeDanedji – Lamidat Baschéo road (16 km) Baschéo Dombolé villages Sourou, Dombolé, 11. Maintenance of the Djabbel 11. Construction of ten (10) OuroKessoum 1, Junction – Bascheo Lamidat section Djabbel, Baschéo stone bays in You village Matafalré, Mael (17 km) Barna, 12. Maintenance of the 12. Construction of eight (8) Djoungoundou, Djoungoundou - DjallouBaschéo stone bays in Ouro Alkali You DjallouBaschéo road (08 km) village 13. Construction of eight (8) 13. Sanitation works in Bascheo and Bascheo, Bascheo Ouro Alkali, stone bays in Ouro Alkali Bascheo Junction (zone 1) Junction Tapare, Posso village 14. Sanitation works in Bascheo and Bascheo, Matafalre (zone 2) Matafalre Source: Social Safety Nets
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For the 2019-2022 period, the Social Safety Nets programmes will assist 276 000 households chosen nationwide for money transfers amounting to 55.9 billion, including 28.8 billion under the ordinary money transfer programme, 20.9 billion under the emergency money transfer programme and 6.2 billion under the labour-intensive public works programme.
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CHAPTER 7: EXECUTION OF THE 2020 BUDGET AND THE 2021 DRAFT BUDGET The context of execution of the State budget for the 2020 fiscal year is characterized by: (i) the passing of an amending finance law following the negative effects of the COVID-19 pandemic on budgetary revenue; (ii) the creation of a Special Appropriation Account (SAA) for the management of COVID-19 response-related budgetary operations; (iii) the admission of Cameroon to the G20 Debt Service Suspension Initiative relating to the temporary suspension of debt service to combat the COVID-19 pandemic; (iv) exceptional disbursements by development partners in support of the financing of the overall coronavirus response plan; (v) lingering security crises; (vi) the signing of an ordinance raising the internal debt ceiling in order to increase the issuance of government securities; (vii) the successful conduct of fungible treasury bill (BTA) and fungible treasury bond (OTA) issuance operations that helped to fill the cash-flow gaps and to continue to finance the public investment programme; (viii) the fall in oil prices below the assumptions of the initial finance law; and (ix) the organization of legislative, council and regional elections.
Some of these factors called into question the initial budgetary estimates of the 2020 fiscal year, while others impacted the achievements of the fiscal year as well as estimates for the 2021 fiscal year. 7.1. Amending Finance Law and budgetary orientation debate
7.1.1. Amending Finance Law
The COVID-19 pandemic has had adverse health, economic and social effects, leading to the reduction of the State budget by 542.7 billion to 4 409 billion. The budget review was materialized by Ordinance No. 2020/1 of 3 June 2020 to amend and supplement some provisions of Law No. 2019/23 of 24 December 2019: Finance Law of the Republic of Cameroon.
Concerning resources, the overall budget provided for:
- a 173.3 billion reduction in oil revenue to take into account the drop in crude oil prices to below 54.4 dollars a barrel, included in the assumptions of the initial finance law;
- a 587.4 billion reduction in tax revenue, including 378.2 billion for domestic taxes and duties, and 209.2 billion for customs revenue, in order to take into account the drop in economic activity;
- an 8 billion reduction in non-tax revenue;
- increases of 45.3 and 142.7 billion in IMF loans and budgetary support respectively, as part of donor support measures for the overall COVID-19 pandemic response plan;
- a 112 billion reduction in project loans, owing to the difficulties faced by some donors;
- a 100 billion increase in the issuance of government securities and a 50 billion increase in bank financing, to offset the drop in domestic revenue.
Concerning expenditure, the overall budget provided for:
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- a 30.3 billion reduction in personnel expenditure; - a 93.8 billion reduction in expenditure on goods and services; - a 78.5 billion reduction in transfers and pensions; - a 130 billion reduction in investment on own resources (including restructuring and rehabilitation operations); - a 112 billion reduction in expenditure on external financing; - a 28 billion increase in public debt interest; - a 126.1 billion drop in external debt depreciation.
Moreover, to better regulate the financing of the response to the COVID-9 pandemic and its induced effects, a special appropriation account called “Special National Solidarity Fund to Fight against the Coronavirus and its Economic and Social Impacts”, abbreviated CAS COVID-19, was established The Fund’s 180 billion budget is financed by the overall State budget, support from development partners and voluntary contributions from natural and legal persons.
7.1.2. Budgetary Orientation Debate (BOD)
Law No. 2018/12 of 11 July 2018 relating to the fiscal regime of the State and other public entities institutionalized the Budget Orientation Debate (BOD) between the Government and Parliament, as a prelude to the review of the finance bill. This exercise enables Parliamentarians to assess the public policy options proposed by the Government and to initiate debate on public action priorities over the next three-year period. The 2020 BOD was held from 7 to 10 July 2020 at the National Assembly and at the Senate. The debate focused on the strategic guidelines adopted for the 2021-2023 period, in the light of the economic situation and public finances at the end of 2019 and during the first half of 2020, as well as with regard to the macroeconomic outlook for the 2021-2023 period.
The debate between the Government and Parliament revealed that the economic and financial situation at the end of 2019 and during the first half of 2020 was marked by a drop in overall revenue collection and significant pressure on expenditure mainly due to the lingering security crisis and the acceleration of AFCON infrastructure construction. Moreover, restrictions on activities imposed by the COVID-19 health crisis and their negative socio-economic effects have jeopardized the macroeconomic and budgetary prospects of the 2020 and 2021, and even 2022, fiscal years. The need for a health, economic and social response resulted in the redefinition of priorities.
Thus, the overall strategic guidelines for public policies during the 2021-2023 three-year period are of two types, namely: (i) specific guidelines relating to the COVID-19 pandemic response; and (ii) guidelines relating to the structural transformation of the economy.
However, budgetary consolidation will remain an overriding objective and require greater non-oil domestic revenue mobilization efforts and continued streamlining of public spending. Overall the budget deficit is expected to drop from 4.5% of GDP in 2020 to 3% in 2021, 2.8% in 2022 and 2.2% in 2023. The debt level would be controlled at an average of about 45% of GDP over the 2021-2023 period.
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Box 1: COVID-19 SAA The COVID-19 pandemic broke out in China at the end of 2019, and gradually spread to Asia, Europe, America and Africa, leading to many deaths and the confinement of a large part of world’s population. The first case of COVID-19 was detected in Cameroon on6 March 2020. To address the situation, the Government set up a health system for the detection and free treatment of all COVID-19-infected persons. To curb the spread of the pandemic, it took thirteen (13) measures in March 2020, including: (i) the closure of borders; (ii) the closure of public and private educational establishments; (iii) the prohibition of gatherings of more than fifty (50) people; (iv) the closing of drinking establishments and restaurants at 6 p.m. Additional measures were subsequently taken, in particular the compulsory wearing of protective masks in all areas open to the public.
The pandemic has had negative health, economic and social consequences. Faced with this situation, the Government took accompanying measures to support ailing sectors, the most fragile households and vulnerable persons. The measures include: (i) a special 25 billion allocation for the reimbursement of VAT credits, with a view to supporting the cash flow of enterprises; (ii) exemption of small traders from payment of the flat-rate tax and municipal taxes for the second quarter of the fiscal year; (iii) an increase in the amount of family allowances from 2 800 to 4 500 francs; and (iv) a 20% increase in the amount of old age pensions that did not benefit from the automatic increase under the 2016 reform. These measures were supported by national and international solidarity through donations from citizens and enterprises, as well as assistance from development partners. A comprehensive response plan has been drawn up to properly supervise and facilitate the implementation of planned actions at the health, economic and social levels.
To strengthen Government’s action and better focus the mobilization and use of resources for the fight against the pandemic, a Special Appropriation Account (SAA) has been created. It is called “Special National Solidarity Fund to Fight against the Coronavirus and its Economic and Social Impacts”, and has a budget of 180 billion.
The resources of the COVID-19 SAA come from:
- payments from the overall budget to the tune of 137 billion, representing 3% of total revenue; - financial contributions from donors in the form of grants or loans to the fight COVID-19 (support funds) amounting to 39.5 billion, of which; 22 billion is from the World Bank, 9 billion from the Global Partnership for Education, 6.5 billion from AFD and 2 billion from the EU; - voluntary contributions from natural and legal persons amounting to 3.5 billion. Expenditure is structured into four (4) programmes as follows: - Economic and Financial Resilience (98.7 billion);
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- Strengthening the Health System (58.7 billion); - Social Resilience and Strategic Supplies (14.5 billion); - Strengthening Research and Innovation (8.1 billion). The COVID-19 SAA management stakeholders are: the Minister in charge of finance, other sector Ministers, the Autonomous Sinking Fund (CAA), COVID-19 SAA focal points of the various ministries, the Financial Controller of the Simplified Channel at the Ministry of Finance and the COVID-19 SAA Specialized Paymaster at the Treasury Central Accounting Office (ACCT). The Minister in charge of finance is the principal authorizing officer. As such, he centralizes all revenue and orders all SAA expenditure. Through Decree No. 2020/3221/PM of 22 July 2020, the Prime Minister, Head of Government, laid down the distribution of the budgetary appropriations allocated to the ministries involved in the fight against the COVID-19 pandemic. It is on this basis that each Minister concerned submits his expense reports to the SAA authorizing officer for payment.
7.2. 2020 Budget Execution
At the end of the first half of 2020 and compared with the Amending Finance Law, the rate of execution of resources stood at 56.2%, including 53.1% for domestic revenue and 62% for loans and grants. Budgetary expenditure execution rate stood at 53%, including 51.8% for current expenditure excluding interest, 33.9% for investment expenditure and 68.6% for debt service. Primary balance deficit (authorization basis) stood at 243.5 billion, and that of non-oil primary balance at 440.6 billion.
7.2.1. Budgetary resources
The initial Finance Law for the 2020 fiscal year provided for resources amounting to 4 951.7 billion, including 3 617.2 billion as domestic revenue (73% of the budget) and 1 334.5 billion as loans and grants (27 %). The Amending Finance Law reduced resources to 4.409 billion, including 2 848.5 billion (64.6%) as domestic revenue and 1 560.5 billion (35.4%) as loans and grants.
At end-June 2020, resources collected amounted to 2 479.8 billion, representing an execution rate of 56.2% compared with the projections of the Amending Finance Law. They increased by 434.5 billion (+ 21.2%) year-on-year.
7.2.1.1. Domestic budgetary revenue
It comprises oil revenue and non-oil revenue. At the end of the first half of 2020, domestic budgetary revenue amounted to 1 512.9 billion, representing an execution rate of 53.1% compared with projections for the fiscal year. In comparison with the end of June 2019,it decreased by 98.6 billion (-6.1%), mainly due to the drop in oil revenue.
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Graph 23: Domestic Revenue Forecasts and Achievements from 2015 to 2020 (in billions)
Source: MINFI * = Estimates 7.2.1.1.1. Oil revenue Oil revenue at the end of June 2020197 stood at 197.1 billion, including 152.8 billion as NHC royalty and 44.3 billion as oil company tax. It dropped by 79.3 billion (-28.7%) year-on-year, due to the fall in oil prices. Its execution rate stood at 73.1% compared with the Amending Finance Law. At the end of the 2020 fiscal year, oil revenue would stand at 331.9 billion, up by 62.2 billion compared with the forecasts of the amending finance law. Graph 24: Trends in the Main Components of Domestic Revenue from 2015 to 2020
Source: MINFI * = Estimates 7.2.1.1.2. Non-oil revenue Non-oil revenue includes revenue from domestic taxes and duties, customs revenue and non- tax revenue. At the end of June 2020, revenue collected stood at 1 315.8 billion, representing a 51% execution rate compared with projections for the fiscal year. It fell by 19.2 billion (-1.4%) compared with the same period in the previous fiscal year. At the end of December 2020, it is expected to stand at 2 626.5 billion.
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Domestic taxes and duties At the end of the first six months of 2020, domestic taxes and duties collected amounted to 946.3 billion, up by 45.5 billion (+ 5.1%) year-on-year. The execution rate stood at 54.9% compared with annual projections. Concerning the main items, there were increases in excise duties (+17.7 billion), oil company tax (+16.2 billion), PIT (+13.2 billion), VAT (+4.6 billion) and STPP (+2.9 billion), which were mitigated by the reduction in registration and stamp duty (-4.9 billion). Collection of taxes and duties was impacted by: (i) the good performance of annual balances; (ii) the increase in revenue from excise duties following the implementation of reforms; (iii) the resilience of major companies to COVID-19, which resulted in improved spontaneous payments year-on- year; and (iv) the adverse effect of COVID-19 on spontaneous payments from SMEs. At the end of December 2020, income from taxes and duties is expected to stand at 1 770.4 billion, up by 45.6 billion compared with the Amending Finance Law. However, this achievement would remain below the 2 103 billion provided for by the initial Finance Law. Graph 25: Projections and Execution of Taxes and Duties from 2015 to 2020 (in billions)
Source: MINFI * = Estimates
Customs revenue At the end of June 2020, customs revenue collected amounted to 300.7 billion, recording an execution rate of 46.3% compared with the Amending Finance Law. It includes 126.9 billion for customs duties and 134.2 billion for import VAT. Compared with the end of June 2019, customs revenue fell by 58.8 billion (-16.4%). As at 31 December 2020, customs revenue is estimated to stand at 644.1 billion, down by 6 billion compared with the Amending Finance Law. Customs revenue collection is expected to be affected by: (i) the non-payment of the debt owed by SONARA and marketers; and (ii) the decline in activity due to the COVID-19-related health crisis.
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Graph 26: Customs Revenue Forecasts and Execution from 2015 to 2020 (in billions)
Source: MINFI * = Estimates Non-tax revenue Non-tax revenue includes revenue from State property, service revenue, pension contribu- tions, dividends and the oil transit tax. At the end of the first half of 2020, non-tax revenue stood at 68.8 billion, representing an execution rate of 33.7% compared with the Amending Finance Law. It recorded a 5.9 billion (-7.9%) drop compared with the same period in 2019. As at 31 December 2020, non-tax revenue is expected to stand at 170.8 billion, down by 33.2 billion compared with annual forecasts. In addition, for the first time non-tax revenue budgeting conferences were held between the Ministry of Finance and the sector ministries in charge of collecting revenue, with a view to improving their yields. Loans and grants The amount of loans and grants provided for by the Amending Finance Law for the 2020 fiscal year stood at 1.560.5 billion, including 420 billion for issuance of government se- curities, 102 billion as grants, 80 billion as bank loans and 45.3 billion as IMF loans. Du- ring the first half of 2020, loans and grants amounted to 967 billion, representing a 62% execution rate. They are broken down as follows: 439.1 billion for issuance of government securities, 208.8 billion as project loans and 180.9 billion as IMF loans. Regarding government securities, the State, during the first half of 2020, issued securities worth a total of 439.1 billion, of which 217.7 billion for fungible treasury bills (OTA) and 221.4 billion for fungible treasury bonds (BTA). BTA issuance is intended to fill cash flow gaps. Resources from OTA issuance are intended for the implementation of AFCON preparation-related infrastructure projects, drinking water supply, energy generation and transmission as well as the construction, rehabilitation and upgrading of some roads. Over the same period, repayments of matured government securities, consisting solely of BTAs, amounted to 199.5 billion, comprising 196 billion in principal and 3.5 billion in interest. The successful issuance of securities and compliance with repayment deadlines reflect the quality of Government’s signature.
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Table 78: Budget Resources for the 2020 Financial Year (in billions, unless stated otherwise) Execution Execution as Execution as IFL AFL Rate Variations at 30/06/19 at 30/06/20 ITEM 2020 (a) as at (b) (c) 30/06/20 (c/b) (c/b) (c/a) (%) (abs) (%) DOMESTIC 3 617,2 2 848,5 1611,4 1512,9 53,1 -98,6 -6,1 REVENUE I-Oil revenue 443,0 269,7 276,5 197,1 73,1 -79,4 -28,7 1-SNH royalty 341,5 169,7 232,1 152,8 90,1 -79,3 -34,2 including Direct 0,0 91,0 96,7 5,8 6,3 interventions 2- Oil company tax 101,5 100,0 44,4 44,3 44,3 -0,1 -0,3 II- Non-oil revenue 3174,2 2 578,8 1334,9 1315,8 51,0 -19,2 -1,4 1- Tax revenue 2962,2 2 374,8 1260,2 1247,0 52,5 -13,2 -1,1 a- Revenue from domestic taxes and 2103,0 1 724,8 900,8 946,3 54,9 45,5 5,1 duties. including –PIT 343,0 291,6 152,3 165,4 56,7 13,2 8,6 - VAT 808,1 621,6 281,1 285,7 46,0 4,6 1,6 -Non-oil 370,0 330,1 208,8 225,0 68,2 16,2 7,7 company tax -Excise 220,0 186,7 101,9 119,5 64,0 17,7 17,3 duties -Registration and stamp 126,2 91,3 53,5 48,5 53,2 -4,9 -9,2 duty -STPP 135,0 112,8 65,6 68,5 60,8 2,9 4,4 b-Customs revenue 859,2 650,0 359,5 300,7 46,3 -58,8 -16,4 including – Customs/ 359,4 276,8 152,1 126,9 45,8 -25,2 -16,6 import duty - import VAT 402,8 295,3 163,4 134,2 45,4 -29,2 -17,9 - Excise/import duty 49,9 37,1 19,7 17,1 46,0 -2,6 -13,3 - Exit fees 36,7 26,4 17,2 17,5 66,3 0,3 1,6 2-Non-tax revenue 212,0 204,0 74,7 68,8 33,7 -5,9 -7,9 B- LOANS AND 1334,5 1560,5 433,9 967,0 62,0 533,1 122,9 GRANTS Issuance of 320,0 420,0 129,0 439,1 104,5 310,1 240,4 government securities -Bank loans 30,0 80,0 0,0 75,0 93,8 75,0 -Grants 102,0 102,0 59,3 10,6 10,4 -48,7 -82,1 TOTAL BUDGET 4 951,7 4 409,0 2045,3 2479,8 56,2 434,5 21,2 EXPENDITURE Source: MINFI
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7.2.2. Budgetary expenditure execution
Budgetary expenditure forecasts in the Amending Finance Law stand at 4.409 billion, broken down as follows: 2.241 billion as current expenditure, excluding interest on debt (50.8% of the total), 1.254.3 billion as public investment expenditure (28.5%) and 913.9 billion as public debt service (20.7%). Although slightly down in proportion, the debt service burden remains high, weighing 32.1% of domestic budgetary revenue, after 35.1% in 2019.
At end of June 2020, budgetary expenditure, authorization basis, amounted to 2 335.5 billion, representing a 53% execution rate compared with the Amending Finance Law. Year-on-year, it went up by 14.6 billion (+ 0.6%). At the end of the year, the total authorized expenditure is expected to stand at 4 598.4 billion, up by 189.3 billion compared with the forecast of the Amending Finance Law.
Graph 27: Breakdown of State Budget Expenditure from 2014 to 2020 (in % of the total)
Source : MINFI
7.2.2.1. Recurrent expenditure excluding interest
Recurrent expenditure excluding interest amounted to 1 160.3 billion in the first half of 2020, representing an execution rate of 51.8% compared with the Amending Finance Law. Year- on-year, it increased by 52.6 billion (+ 4.7%), due in particular to the pressure exerted by COVID-19 pandemic-related health expenditure made up of current operating expenses and transfer and pension expenses. At the end of the year, the execution of this expenditure should be in line with the Amending Finance Law.
7.2.2.1.1. Recurrent expenditure
Current expenditure includes personnel expenditure and purchases of goods and services. After the reduction induced by the Amending Finance Law, the allocation for current operating expenses for the 2020 fiscal year dropped from 1 829.6 billion to 1 706.8 billion, including 1 040.1 billion as personnel expenditure and 666.7 billion as purchase of goods and services.
At the end of June 2020, recurrent operating expenditure amounted to 868.5 billion, representing an execution rate of 50.9% compared with the Amending Finance Law. Compared with the end of June 2019, it went up by 22.8 billion (+ 2.7%), mainly due to the increase in personnel
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expenditure, which increased from 485.3 billion to 511.7 billion. Expenditure on goods and services stood at 356.7 billion, down by 3.7 billion (-1%). Compared with annual projections, the execution rates for personnel expenditure and purchase of goods and services stood at 49.2% and 53.5% respectively. 7.2.2.1.2. Transfers and pensions Budgetary allocations for transfers and pensions stood at 534.2 billion, including 311.5 billion as subsidies and 222.7 billion as pensions. As at 30 June 2020, expenditure amounted to 291.8 billion, representing an execution rate of 54.6% compared with the Amending Finance Law. It included 175.6 billion as subsidies and 116.2 billion as pensions. Execution rates stood at 56.4% for grants and 52.2% for pensions. Year-on-year, transfers and pensions increased by 29.8 billion (+ 11.4%). 7.2.2.2. Public investment expenditure Public investment budget (PIB) fell by 242 billion to 1 254.3 billion in the Amending Finance Law. It included 684 billion as investment expenditure on external financing, 542.2 billion as investment on own resources and 28.1 billion as restructuring expenditure. The infrastructure sector had the largest allocation, weighing 56.4% of GDP. Graph 28: Sector Breakdown of GDP for the 2020 Financial Year
Source: BEAC/MINFI
At the end of the first half of the 2020 fiscal year, public investment expenditure amounted to 424.9 billion, representing an execution rate of 33.9% compared with the Amending Finance Law. By item, the execution rates stood at 34.9% for expenditure on own resources, 32.1% for expenditure on external financing and 57.7% for restructuring expenditure. Year-on-year, public investment expenditure fell by 154.9 billion (-26.7%), mainly due to the drop in disbursements for project loans.
7.2.2.3. Public debt
In the Amending Finance Law, forecast public debt service dropped by 98.2 billion compared with the initial Finance Law and stood at 913.9 billion. This decrease is related to Cameroon’s admission to the G20 Debt Service Suspension Initiative which seeks to temporarily suspend debt service in order to support the most underprivileged countries in the fight against
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COVID-19. External debt service stood at 374 billion, including 170 billion as principal and 204 billion as interest. Domestic debt service stood at 539.7 billion, including 345.8 billion as depreciation of the principal and 72 billion as VAT credit refunds.
At the end of the first half of 2020, effective public debt service amounted to 627 billion, representing a 68.6% execution rate compared with the Amending Finance Law. It rose by 159.7 billion (+ 34.2%) compared with the same period in 2019. Effective external debt service amounted to 201.6 billion, including 75.1 billion as interest and 126.5 billion as principal. Domestic debt payments stood at 425.4 billion, including, in particular, 30.4 billion as interest, 310.7 billion as domestic debt arrears, and 37 billion as VAT credit repayments. It should be noted that exceptional payments amounting to 25 billion were made at the end of the second quarter of 2020 for VAT credit refund as part of the SAA relating to the overall COVID pandemic-19 response plan.
As at 30 June 2020, outstanding public and State-guaranteed debt was estimated at 9 219 billion (41.3% of GDP), including 9 185 billion for direct debt and 34 billion as guaranteed debt. The outstanding public debt included 72.5% of external debt, 27% of domestic debt and 0.5% of guaranteed debt. The stock of external debt stood at 6.683 billion, including 2 634 billion as multilateral debt, 3 045 billion as bilateral debt and 1 003 billion as commercial debt. The stock of domestic debt amounted to 2 502 billion, including 983 billion as government securities, 593 billion for structured debt, 577 billion for BEAC consolidated debt and 69 billion for non- structured debt. Graph 29: Breakdown of Outstanding Public Debt Graph 30: Breakdown of Outstanding External and Endorsed Debt as at 30 June 2020 Public Debt as at 30 June 2020
Sources : CAA ; MINFI Sources : CAA ; MINFI
7.2.3. Variation of payment arrears and basic budget balances
At the end of the first half of the 2020 fiscal year, variation in the stock of payment arrears showed a reduction of 44.7 billion. The reduction resulted from the accumulation of 279.6 billion in new pending arrears for the 2020 fiscal year, combined with payments worth 324.3 billion on pending arrears for the 2019 fiscal year and on arrears for previous fiscal years.
State transactions representing revenue and grants mobilized, and expenditure executed showed an overall payment balance, authorization basis, of -354.9 billion. Primary balance, authorization basis, stood at -243.5 billion, and non-oil primary balance at -440.6 billion. Primary balance, defrayment basis, stood at -45.1 billion and the non-oil primary balance at -242.2 billion.
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Table 79: Budgetary Expenditure for the 2020 Financial Year (in billions)
Execution ILF Execution Implementation Variations AFL as at 2020 as at Rate as at 2020 30/06/20 (d/c) (d/c) ITEM 30/06/19 30/06/20
(a) (b) (c) (d) (d/b) (%) (abs) (%) I-Recurrent expenditure 2 443,5 2 241,0 1 107,7 1 160,3 51,8 52,6 4,7 (excluding interest) Recurrent operation 1 829,6 1 706,8 845,7 868,5 50,9 22,8 2,7 Personnel expenses 1 070,2 1 040,1 485,3 511,7 49,2 26,5 5,5 Expenditure on 759,4 666,7 360,4 356,7 53,5 -3,7 -1,0 goods & services Transfers and pensions 613,9 534,2 262,0 291,8 54,6 29,8 11,4 including - Subsidies 391,2 311,5 157,0 175,6 56,4 18,5 11,8 - Pensions 222,7 222,7 105,0 116,2 52,2 11,2 10,7 I- Investment 1 496,3 1 254,3 579,8 424,9 33,9 -154,9 -26,7 expenditure On external financing 796,0 684,0 342,8 219,4 32,1 -123,5 -36,0 On own resources 654,4 542,2 223,6 189,3 34,9 -34,4 -15,4 Restructuring 45,9 28,1 13,4 16,2 57,7 2,9 21,5 expenses III- Sundry expenses to 0,0 0,0 74,5 123,4 49,0 65,8 regularize IV- Retroceded loans 0,0 0,0 91,7 0,0 -91,7 -100,0 V – Public debt service 1 011,9 913,7 467,3 627,0 68,6 159,7 34,2 External debt 472,2 374,0 249,4 201,6 53,9 -47,9 -19,2 - Interest 170,0 170,0 92,5 75,1 44,2 -17,4 -18,8 - Principal 302,2 204,0 157,0 126,5 62,0 -30,5 -19,4 Domestic debt 539,7 539,7 217,8 425,4 78,8 207,6 95,3 - Interest 50,6 49,9 13,5 30,4 60,9 16,9 125,3 - Depreciation of 417,3 345,8 57,9 47,3 13,7 -10,6 -18,3 principal - VAT credit refund 72,0 72,0 36,0 37,0 51,4 1,0 2,8 - Domestic arrears 72,0 72,0 110,5 310,7 431,5 200,2 181,3 TOTAL BUDGET 4 951,7 4 409 2 320,9 2 335,5 53,0 14,6 0,6 EXPENDITURE Source: MINFI 7.3. Draft Budget for the 2021 Fiscal Year The State’s draft budget for the 2021 fiscal year is based on the following key macroeconomic assumptions: (i) a 3.3% real GDP growth rate, of which 3.5% for non-oil GDP ; (ii) a non-oil GDP deflator of 1.5%; (iii) a Cameroon’s oil price of 40.3 dollars per barrel (after taking into account a 3.5 dollar discount to the world price of 43.8 dollars) and production of 24.8 million barrels; (iv) a gas production projected at 82 billion SCF (standard cubic feet); (v) a gas barrel price of 4.4 dollars; (vi) a dollar exchange rate of 579.8 CFA francs per dollar; (vii) a budget balance deficit (excluding grants) capped at 4.1% of the GDP.
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Based on these elements, the 2021 draft budget is balanced in revenue and expenditure at the sum of 4 865.2 billion CFA francs of which 195.2 billion CFA francs is for Special Appropriation Accounts (SAAs), against 4 632.7 billion CFA francs in 2020, representing an increase of 232.5 billion CFA francs in absolute terms and 5.0% in relative terms. Non-oil revenue represents 61.5% of the budget. 7.3.1. Revenue analysis Revenue is broken down in the table below. Table 80: Revenue Breakdown CHARGE WORDING 2020 2021 A – GENERATED REVENUE 2 848 547 3 349 700 I – TAX REVENUE 2 374 847 2 743 100 721 Personal income tax 274 526 286 280 723 Non-oil company profit tax 330 053 340 000 724 Tax on revenues given to persons residing out of cameroon 81 639 95 000 728 Tax on transfers and transactions 54 762 63 300 730 Value added and turnover tax 912 911 1 075 607 731 Tax on specific products and excise duties 335 886 407 384 732 Tax on specific services 2 399 420 733 Tax on the right to carry out a professional activity 12 781 13 585 735 Other taxes and duties on goods and services 10 055 12 845 736 Import taxes and duties 290 950 351 653 737 Export taxes and duties, and other taxes on foreign 31 508 44 756 trade 738 Registration and stamp duty 36 517 49 205 739 Other taxes and duties not classified elsewhere 860 3 065 II - PART IV -OTHER REVENUE 473 700 606 600 710 Administrative charges and fees 60 183 60 183 714 Incidental sale of property 79 79 716 Revenue from sale of services 21 623 21 623 719 Rents and revenue from property 4 200 4 200 741 Revenue from the oil sector 286 700 418 000 745 Accrued financial proceeds 39 500 41 100 761 Contributions to the retirement scheme of civil servants 60 000 60 000 ad persons ranking as such under apu 771 fines and pecunary judgements 1 415 1 415 B - LOANS AND DONATIONS 1 697 500 1 470 300 150 Drawings on direct external multilateral loans 215 190 300 880 151 Drawings on directexternal bilateral loans 390 569 218 310 152 Budget support 440 500 260 000 153 Drawings on loans to private external bodies 49 241 184 210 161 Issue of treasury bonds exceeding wo years 500 000 400 000 769 Exceptional donations from the international 102 000 106 900 cooperation TOTAL REVENUE (A+B) 4 546 047 4 820 000 SUPPORT FUND 43 000 0 SPECIAL ALLOCATION FUND REVENUE 43 700 45 200 TOTAL REVENUE 4 632 747 4 865 200
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7.3.1.1. Tax revenue
Tax revenue stood at 2,743.1 billion, representing an increase of 15.5%. This is mainly due to the increase in VAT (+17.8%) and import duties and taxes (+20.9%). The other components also recorded significant increases, notably 12.7% for tax on the profits of non-oil companies and 21.3% for taxes on specific products and excise duties, which stood at 407.4 billion.
7.3.1.2. Other revenue
Other State revenue increased by 28.1% compared to 2020, mainly due to a substantial increase in “revenue from the oil sector” which is traditionally the most important item under this heading. This item, composed of the NHC royalty and oil company profit tax, increases from 286.7 billion in 2020 to 418.0 billion in 2021, i.e. an increase of 45.8%. As for the NHC royalty, it increased by 33.9% due to the export of natural gas. On the other hand, the pipeline rights of way fell by 11.1%. As for tax on the earnings of oil companies, it fell 17.3% to stand at 124 billion euros.
7.3.1.3. Loans and grants
Expected resources for loans and grants amount to 1,470.3 billion against 1 697.5 billion in 2020, representing a decrease of 13.4%. They comprise 585 billion in loans and 106.9 billion in grants (including 45.5 billion under C2D). In addition to these two headings, 350 billion in government bond issues, 30 billion from bank financing and 20 billion in net loans are added to these two headings.
Exceptionally, since 2020, the SAAs, particularly the one devoted to financing the fight against COVID-19 and its economic and social repercussions, have benefited from a levy on State income. The SAA allocated to the fight against COVID-19 has been reduced from 180 billion in 2020 to 150 billion in 2021 in order to take into account not only the fight against the pandemic, but also the plan to support the production of mass-consumption products. To this sum must be added revenue from the other SAAs, which rose from 43.7 billion to 45.2 billion. As a result, revenue from all SAAs in 2020 will fall from 223.7 billion to 195.2 billion in 2021, representing a decrease of 28.5 billion in absolute terms and -12.7% in relative terms.
7.3.2. Expenditure analysis
The table below presents the expenditure structure of the draft budget for the 2021fiscal year. This structure is based on the need to reconcile the imperative to fight against COVID-19 and its economic and social impact, to meet recurrent expenditure, ensure minimum expenditure for the smooth functioning of government services, fulfil our debt obligations and implement projects in accordance with the National Development Strategy, the Emergency Plan for the Acceleration of Growth, the Three-Year Special Youth Plan and preparations for the 2022 Africa Cup of Nations.
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Table 81: State Expenditure Structure (in billions) Variations ITEM 2020 2021 % Absolute GENERAL BUDGET Personnel expenditure 1 040, 1 1 069,8 2,9% 29,7 Procurement of goods and services 663,3 736,9 11,1% 73,6 Transfers and subsidies 537,6 528,8 -1,6% -8,8 Capital expenditure 1 254,3 1 352,0 7,8% 97,7 Public debt 913,7 982,5 7,5% 68,8 TOTAL 4 409,0 4 670,0 5,9% 261 SPECIAL APPROPRIATION ACCOUNTS COVID-19 SAA Fund 180 100 -44,4% -80,0 Fund for the Revitalization of the Local Production of 50 50 Products of Mass Consumption Other SAAs 43,7 45,2 3,4% 1,5 TOTAL 223,7 195,2 -12,7% -28,5 GRAND TOTAL 4 632,7 4 865,2 5,0% 232,5 7.3.2.1. Personnel expenditure
Personnel expenditure rose by 29.7 billion. This increase is explained by the inclusion in the Government payroll of new teachers who graduated from Higher Teacher Training Colleges as well as graduates from higher institutions of learning, and announced recruitments in the armed forces and police.
7.3.2.2. Purchase of goods and services The procurement of goods and services for the functioning of government services rose by 73.6 billion, representing 11.1%. This increase reflects the need to finance the operationalization of the regions, security expenditure and recurrent expenditure resulting from the numerous investments carried out in recent years. However, the instructions of the Head of State prescribing a continuous reduction in State expenditure were observed with respect to the rational selection of activities to be implemented and the rigorous assessment of their cost.
7.3.2.3. Transfers and subsidies In order to make transfers to public establishments and other public bodies, pay pensions and honour commitments to pay contributions to international organisations, the allocation under the State budget for 2021 stands at 528.8 billion, down by -1.6%, that is 8.8 billion compared with the previous year. However, this allocation not only helped to ensure the realistic budgeting of pensions whose amount is increasing steadily, but also to cover the expenditure of public establishments that hitherto did not benefit from subsidies included in the budget.
7.3.2.4. Capital expenditure Capital expenditure appropriations amount to 1 352.0 billion compared with 1 254.3 billion in 2020, representing an increase of 7.8% in relative terms and 97.7 billion in absolute terms. This increase is perfectly in line with Government’s option to raise capital expenditure by at least
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1% of GDP per annum. Capital expenditure is broken down as follows: (1) 1 317.1 billion for development projects, of which 733.8 billion is from external financing and 95.1 billion for investment activities; (ii) 15 billion for rehabilitations; and (iii) 20 billion for shareholding. It is worth noting that the capital expenditure related to the implementation of the Emergency Plan stands at 260.0 billion.
7.3.2.5. Public debt
Projected public debt service for the 2021 fiscal year increases by 7.5% and stands at 982.5 billion. It is broken down as follows: (i) external debt: 491.0 billion, as against 374.0 billion in 2020; and (ii) domestic debt: 491.4 billion, as against 539.7 billion the previous year.
7.3.2.6. Expenditure of the Special Appropriation Accounts
Expenditure of Special Appropriation Accounts stands at 195.2 billion in 2021, a decrease of 28.5 billion in absolute terms and -12.7% in relative terms. This decrease reflects the 44.4% drop in the expenditure of the COVID-19 SAA, from 180 billion in 2020 to 100 billion in 2021. It should be emphasized that a Fund for the Revitalization of the Local Production of Products of Mass Consumption has been set up to support the import-substitution policy, whose amount for 2021 is capped at 50 billion. The expenditure of other Appropriation Accounts increases by 3.4%, rising from 43.7 billion in 2020 to 45.2 billion in 2021.
The breakdown per head of overall expenditure estimates for projects under the general State budget is as follows:
Table 82: Proposed Appropriations Opened for the 2021 Financial Year (in millions) HEADS WORDING 2020 2021 01 Presidency of the republic 38 322 40 602 02 services attached to the Presidency of the Republic 5 299 5 931 03 National assembly 20 682 24 682 04 Prime Minister’s office 15 411 17 676 05 Economic and Social council 1 591 1 591 06 External Relations 27 923 30 800 07 Territorial Administraion 28 697 34 785 08 Justice 57 489 60 549 09 Supreme Court 3 957 4 130 10 Public Contracts 14 270 14 485 11 Supreme State Audit Office 3 922 5 195 12 General Delegation for National Security 95 696 87 175 13 Defence 226 333 245 913 14 Culture 3 895 4 727 15 Basic Education 226 015 232 742 16 Sport and Physical Education 62 061 42 317 17 Communication 3 189 4 618 18 Higher Education 57 136 57 545
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HEADS WORDING 2020 2021 19 Scientific Research and Innovation 7 600 8 691 20 Finance 51 549 56 950 21 Trade 6 786 7 496 22 Economy, Planning and Regional Dev Elopment 51 176 51 248 23 Tourism And Leisure 9 079 8 901 25 Secondary Education 392 366 386 954 26 Youth Affairs and Civic Education 22 750 20 234 27 Decentralization and Local Development 42 535 46 088 28 Environment, Nature Protection and Sustainable Development 6 055 6 391 29 Mines, Industry and Technological Development 8 237 9 496 30 Agriculture and Rural Development 72 652 86 956 31 Livestock, Fisheries and Animal Industries 29 146 41 532 32 Water and Energy 222 845 226 084 33 Forestry and Wildlife 14 407 15 950 35 Employment and Vocational Training 19 007 19 013 36 Public Works 397 752 464 842 37 State Property, Surveys and Land Tenure 14 546 18 158 38 Urban Development and Housing 112 018 124 843 39 Social Economy and Handicraft 8 819 10 001 40 Public Health 188 815 197 122 41 Labour and Social Security 5 085 5 492 42 Social Affairs 9 798 10 549 43 Women’s Empowerment and the Family 7 349 7 852 45 Posts And Telecommunication 24 896 21 496 46 Transports 10 713 47 944 48 National Disarmament, Demobilization And Reintegration 3 966 3 466 Committee 49 Constitutional Council 3 102 3 744 50 Public Service and Administrative Reforms 9 332 11 332 51 Elections Cameroon 10 683 11 083 52 National Commission on Human Rights and Freedoms 703 1 246 53 Senate 15 162 15 162 54 National Commission for The Promotion of Bilingualism and 2 920 2 980 Multiculturalism 95 Brought forward of appropriations 8 000 7 000 Total heads and bodies 2 681 736 2 871 758 Including Current Expenditure (I) 1 547 771 1 649 846 Including Capital Expenditure 1 133 965 1 221 912 55 Pensions 222 686 240 000 60 Grants and Contributions 197 742 142 271 65 Common Expenditure 272 818 303 453 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 143 MINISTRY OF FINANCE
HEADS WORDING 2020 2021 Total Common Operating Heads (Ii) 693 246 685 724 Total Current Expenditure (I) + (Ii) [A] 3 374 982 3 557 482 56 External Public Debt 374 000 491 000 57 Domestic Public Debt 539 720 491 430 Total Debt Service [B] 913 720 982 430 Capital Expenditure Heads and Bodies 1 133 965 1 649 846 Including External Financing 684 000 733 800 92 Shareholding 19 288 20 000 93 Rehabilitation/Restructuring 8 824 15 000 94 Investment Interventions 92 233 95 088 Total Capital Expenditure [C] 1 254 300 1 352 000 Grand Total State Expenditure [A]+[B]+[C] 4 409 047 4 670 000
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CHAPTER 8: 2020-2023 MACROECONOMIC AND BUDGETARY OUTLOOK The macroeconomic outlook will depend on many parameters, including: (i) the scope and duration of the COVID-19 pandemic; (ii) trends in commodity prices and world demand; and (iii) the effectiveness of the Government’s initiatives to preserve jobs and revive economic activity. These uncertainties will affect global and national economies. 8.1. International Economic Environment Deeply affected by the COVID-19 crisis, the world economy is gradually emerging from the slump into which it had been plunged during the “Major Confinement” of April 2020. Fearing a new wave of contamination, many countries have slowed down the reopening of their borders while some are reinstating confinements to protect at-risk populations. Taking this situation into account, the IMF’s revised overall growth projections in October 2020 showed a 4.4% contraction in 2020, then a rebound to 5.2% in 2021. However, the rebound would be uneven across regions and groups of countries. Projections for the group of advanced countries anticipate a growth rate of –5.8% in 2020 and +3.9% in 2021. Despite this recovery, this group’s 2021 GDP would be around 2% below its 2019 level. The economy of the United States is expected to contract by 4.3%, before a growth recovery of 3.1% in 2021. A deeper contraction of 8.3% is expected in the Euro zone in 2020, due to a sharper decline in the first half of the year, then a growth recovery of 5.2% in 2021. Forecasts for emerging and developing countries show growth rates of -3.3% in 2020, and 6% in 2021. It should be noted that in this group, China has the best outlook: its economy is expected to grow by 1.9% in 2020 and 8.2% in 2021. After the reopening of most parts of the country at the beginning of April, activity returned to normal faster than expected, thanks to strong support from public policies and good export performance. The outlook for many emerging and developing countries remains precarious. This is due to several factors, including the fact that the pandemic continues to spread, thus overwhelming health systems; the significant weight in the structure of the economies of hard-hit sectors such as tourism; and greater reliance on external sources of funding such as remittances. In Sub-Saharan Africa, activity is expected to decline by 3% in 2020, which is its worst performance ever. Tourism-dependent countries are the hardest hit by the crisis. In 2020, oil- exporting countries, also affected, would experience a 4% contraction on average, while non-oil commodity-exporting countries are expected to experience a 4.6% decline. In 2021, growth in this region is expected to stand at 3.1%. However, many countries will not be able to attain their 2019 production levels until 2022–2024. In some of the major countries in the region (South Africa, Angola, Nigeria), real GDP will not return to pre-crisis levels before 2023 or 2024. Projections for 2021 are based on an improvement in exports and commodity prices, against the backdrop of a recovery in the global economy. Also, there would be improvements in: (i) consumption, in conjunction with the continued easing of containment measures; and (ii) private investment, with a return of FDI. Regarding health, it is assumed that for most countries, some physical distancing measures (mandatory or optional) will be maintained in 2021, but gradually eased towards the end of 2022, as immunization coverage and treatments improve, with fewer cases of local contamination.
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In South Africa, the economy will shrink by 8% in 2020, mainly as a result of containment measures. Investment, export and private consumption are expected to decline, and will be partly offset by lesser imports. Production will recover slightly in 2021, with a 3% growth, and will maintain this momentum thereafter, since the confidence of business owners is sensitive to growth-generating reforms. Nigeria’s economy will contract by 4.3% in 2020 due to low oil prices, reduced production by virtue of the agreement concluded between the Organization of Petroleum Exporting Countries and other large oil producers (OPEC +) and confinement-induced decline in domestic demand. Growth is projected to peak at 1.7% in 2021, following the rise in oil prices and the increase in oil production. In Angola, the crisis has worsened existing vulnerabilities. Real GDP is projected to decline for the fifth consecutive year. The economy will contract by 4% in 2020, given the drop in oil production and prices, the tightening of credit conditions as well as the decline in industrial and commercial activity. A rise in oil prices and government support measures will help the economy to recover in the short term, with a positive growth of 3.2% in 2021 In advanced countries, inflation is expected to reach 0.8% in 2020 and 1.6% in 2021. In emerging and developing countries, the inflation rate is estimated at 5% in 2020 and at 4.7% in 2021. In Sub-Saharan Africa, average inflation, which fell after reaching a double-digit peak in 2017, is expected to rise from 8.5% in 2019 to 10.6% in 2020, largely as a result of rising food prices. Table 83: Some Global Economy Performance Indicators 2019 2020* 2021** GDP growth (in %) Global economy 2,8 -4,4 5,2 United States 2,2 -4,3 3,1 Euro zone 1,3 -8,3 5,2 Japan 0,7 -5,3 2,3 China 6,1 1,9 8,2 India 4,2 -10,3 8,8 Sub-Saharan Africa 3,2 -3 3,1 Nigeria 2,2 -4,3 1,7 South Africa 0,2 -8,0 3,0 CEMAC 2,1 -3,1 3,4 Inflation (in %) Global economy United States 1,8 1,5 2,8 Euro zone 1,2 0,4 0,9 Japan 0,5 -0,1 0,3 China 2,9 2,9 2,7 India 4,8 4,9 3,7 Sub-Saharan Africa 8,5 10,6 7,9 Nigeria 11,4 12,9 12,7 South Africa 4,1 3,3 3,9 CEMAC 2,0 2,6 2,7 Source: IMF/BEAC * Estimates ** Forecasts 146 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW
In the medium term, the IMF foresees that growth would only partially catch up with the activity trajectory initially forecasted (before the pandemic) for the 2020–25 period, both in advanced, emerging and developing countries. The gloomy medium-term growth outlook is combined with an expected sharp rise in outstanding sovereign debt. The drop in production potential implies that the taxable item would, in the medium term, be lesser than that initially envisaged, thus amplifying debt service difficulties.
The current outlook is fraught with many uncertainties. New waves of contamination could undermine recovery. In the event of a further spread of the pandemic or new waves of contamination, more lasting containment measures may be required. They would have a direct and immediate impact on economic activity and more indirect effects on confidence and behaviour (by imposing a costly redistribution of resources). Baseline projections indicate that physical distancing measures will continue until 2021, but will reduce as vaccine coverage increases and treatment improves. It is assumed that local transmission will be brought down to low levels everywhere by the end of 2022. Medium-term projections also show that countries will suffer lasting consequences due to the magnitude of the recession and the structural changes that are required, resulting in lingering effects on production potential. These effects include adjustment costs and productivity implications for surviving businesses that need to improve workplace safety; amplification of the shock through company bankruptcies; the costly reallocation of resources between sectors; and discouraged workers who will withdraw from the labour force. These effects would exacerbate forces that drove down productivity growth in many countries in the years before the pandemic, namely: physical capital accumulation held back by relatively weak investment growth, weaker human capital improvements, and slower efficiency gains when integrating technological developments with factors of production.
A prolonged pandemic could also cause liquidity conditions to tighten sharply. Financial markets could reassess the price of at risk assets, exposing the current debt vulnerability and weakening banks and non-bank intermediaries. Financing difficulties could then hit vulnerable public administrations in Africa, resulting in debt sustainability pressures and defaults, capital outflows, depreciation pressures and, in some cases, high inflation levels. The main domestic risks include the exacerbation of pre-existing socio-economic inequalities and political instability, which would undermine confidence and hinder effective economic policy formulation. In this context, several countries will organize elections in the coming year despite their limited budgetary space, with increased slippage risks. Other countries are facing thorny security and political problems (Mali). The region also remains exposed to climate shocks such as floods and droughts.
When the health crisis loses intensity, further difficult trade-offs will have to be made to restore growth and stability. In the longer term, leaders who aim to revive their economies will have fewer resources and will likely have to make difficult choices. Indeed, without massive additional aid, many countries will struggle to simply maintain macroeconomic stability while at the same time meeting the basic needs of their populations. The budgetary policy, for example, would need to reconcile immediate economic revival needs with debt sustainability imperatives. Monetary policy, on the other hand, would need to strike a balance between the need to support growth and the imperative of external stability and longer-term credibility. Financial regulation and supervision will need to meet the immediate needs of crisis-affected
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banks and enterprises, without jeopardizing the ability of the financial system to support longer- term growth. These efforts should also be weighed against the need to preserve social stability while preparing the ground for long-term sustainable and inclusive growth. 8.2. Domestic Economy Trends in 2020 In 2020, economic activity was carried out in an environment marked at the international level by an unprecedented recession. At the domestic level, several constraints weighed on economic activity, in particular the security crises and the effects of COVID-19.
Economic activity is expected to contract by -2.6%, for the first time in nearly three decades. This decline is associated with the negative consequences of the COVID-19 pandemic. Indeed, the adoption of restrictive measures implemented within the framework of the fight against the pandemic has led to a drop in demand for our export products, coupled with a significant deterioration of commodity prices, notably crude oil. Similarly, at the local level, demand and/or supply fell in several sectors of activity.
8.2.1. Supply trends The negative impact of the COVID-19 pandemic on economic activity is felt in both the oil and non-oil sectors. In the oil sector, growth is expected to decline by 3.7% in 2020, as against an 8.4% increase in 2019. This regression is the result of the significant drop in investments and the contraction of extraction activities in order to limit financial losses due to the drop in crude oil prices. In the non-oil sector, growth would stand at -2.6% after +3.5% in 2019 and perceptible in all sectors of activity.
Primary sector
Economic activity in the primary sector is expected to contract by 1.1% in 2020, as against an increase of 2.8% in 2019. This contraction is attributable to the drop in the “industrial export agriculture” (-4%), “forestry and logging” (-5.4%) and “livestock and hunting” (-0.6%) branches. Indeed, there are strong uncertainties regarding the marketing of the main products in “industrial export agriculture” including export cocoa, cotton, rubber and bananas. The inability to control COVID-19 among our major customers would reduce global demand for cocoa in particular, the main agricultural export product, despite the strong local supply. It is estimated that there would be a 3% drop in cocoa production in 2020.
In the “food crop agriculture” and “livestock and hunting” branches, the extension of restrictive measures in the second half of 2020, in particular the closure of land borders with countries of the sub-region, resulted in the contraction of global demand for products in these branches. This resulted in difficulties for local producers to sell their products. This situation led to serious price disruptions in the second quarter for some products, in particular tomatoes and poultry, as well as certain fruits and vegetables which were highly demanded because of their therapeutic virtues. The measurement of the price index in the first half of 2020 reveals that the prices of fruits and vegetables increased by 9.3% and 7.7% respectively.
Regarding livestock, the economic situation survey for the second quarter of 2020 showed an overall 33% decline in meat production compared with the same period in 2019. This drop is strongly marked by the fall in poultry production (-71%). Production is predominantly beef (45%), poultry (19%), pork (16%) and other meat products (20%).
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The “forestry and logging” branch is expected to shrink by 5.4% in 2020. This contraction is related to the reduced demand from our major trading partners facing a severe economic recession.
Secondary sector
Growth in the secondary sector would stand at -1.9% in 2020, as against + 4.9% in 2019. Excluding hydrocarbons, growth would decline by 1.5% in 2020, as against an increase of 4.1% in 2019. The downturn in activities in the secondary sector is mainly attributable to manufacturing industries.
Agro-food industries are expected to register a growth of -1.2%, as against an increase of 2.5% last year. Given the difficult economic situation caused by the COVID-19 pandemic, with the implementation of social distancing measures and the closure of borders in the second quarter of 2020, the activities of this branch have experienced constraints, both in terms of raw material supplies and outlets. Regarding outlets, in particular, several agro-food industries encountered difficulties in accessing markets in the sub-region, due to the closure of borders. In addition, at local level, the restrictive measures in the hotel and restaurant sectors considerably reduced demand for agro-food products.
Other manufacturing industries is expected to stand at -4.2%, as against an increase of 5.4% in 2019. Weak global demand would result in lower production in the rubber industries (-5%), wood industries except furniture manufacturing (-4.6%) and basic metallurgical industries (-12.5%). Difficulties in the supply of raw materials in textile and clothing industries and the cessation of SONARA’s production would also contribute to growth decline in this sub-sector.
Regarding electricity production and distribution, value added growth is expected to decline by 0.6%, as against an increase of 0.3% in 2019. The weakening electrical energy production is attributable to the drop in electricity consumption, following the slowdown in economic activity.
Activities in building and public works (BPW) are expected to grow by 1.3% after 4.7% in 2019. This slowdown is related to the decline in public investments to preserve irreducible spending and free up space to cope with response to the pandemic.
Tertiary sector
The impact of the health crisis on services would be greater, with a 3.6% contraction in 2020, as against a 3% increase in 2019. This decline would varyingly affect the various branches in this activity sector. Depending on the scale of the impact, branches in this sector are grouped into three categories: (i) branches that would record a sharp drop in activities (hotel, catering, transport); (ii) branches that would record a moderate fall in activities (trade and financial services); and (iii) branches that would register an upturn in activities (telecommunications).
The restaurants and hotels branch would be the hardest hit by the COVID-19 pandemic, with a decrease of 19.2%, as against an increase of 1.8% in 2019. The closure of air and land borders in the second quarter resulted in a drop in the number of tourists, consequently a decrease in the number of people visiting hotels and restaurants. In addition, restrictive measures relating to the closing hours of tourism and leisure establishments contributed to considerably reduce activities in this sector.
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In the transport branch, the various preventive measures resulted in the restriction of urban and interurban travel, resulting in a reduction in activities. Growth in this branch is expected to stand at -7.8% in 2020 after +3.5% in 2019.
In the trade and vehicle repair branch, growth is estimated at -1.7%, after +4.2% in 2019. This regression is explained by the induced effects of the decline in production activities upstream. Financial services are also expected to decline by 1.9% after rising by 6.9% in 2019.
On the other hand, telecommunications activities are expected to grow by 3%, after 3.9% in 2019. This situation is justified notably by greater use of teleworking and distance education as part of measures aimed at containing the spread of the coronavirus.
8.2.2. Demand trends
Domestic demand
Domestic demand is expected to decline following the downturn in private consumption and business investments. Household consumption would fall by 6.5% due to the decline in household expenditure on manufactured goods, in particular clothing, acquisition of capital goods, transport, catering and leisure. Conversely, consumption by public services is expected to increase by 0.4%, driven by increased pandemic response spending.
The decline in private consumption results from the significant drop in household income, related to the drop in resources generated by agro-pastoral and informal activities. In addition, job losses in the formal sector, due to technical leave or downsizing in companies, will also contribute to the decline in household income. Against a backdrop of strong uncertainties and declining activity, investments would also contract by 1.9% in 2020, as against an increase of 8.1% in 2019. Such contraction concerns both private and public investments. Business investment is expected to drop to 1.8%. Indeed, enterprises, faced with persisting degraded demand and cash flow constraints, will have to postpone non-essential short-term spending.
External demand
External demand is expected to drop due to the slump in activity among our partners. Exports are expected to decline by 3.1% in volume after a 5% increase in 2019. According to customs statistics, in the first half of 2020, goods import fell by 27.6% in value, as compared to the same period in 2019. Regarding price trends, over the first six months of the year, the level of inflation stood at 2.5%, against 2.4% during the same period in 2019. Despite some upheavals in April and May, the health crisis did not have a significant impact on prices in the first half of 2020. According to the NIS, 16% of household consumption products did not experience any price change, 29% registered a price drop and 55% witnessed a price increase. The level of inflation throughout the year should remain around 2.5%, due to persisting food supply difficulties combined with a decline in supply.
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Table 84: GDP Breakdown by Sector (in %) 2016 2017 2018 2019 2020 2021 2022 2023 Primary sector 5,0 3,2 5,1 2,8 -1,1 3,2 4,2 4,9 Agriculture and foodstuff 5,8 4,8 5,1 3,7 2,5 3,7 4,4 4,7 Industrial and export agriculture 6,6 -3,1 3,9 -0,1 -4,0 2,1 4,6 5,8 Livestock. hunting 4,3 4,7 4,4 5,5 -0,6 4,7 4,7 4,6 Fishing and fish farming 5,0 4,5 3,1 4,9 1,2 3,3 3,3 3,5 Forestry and logging 1,2 6,3 7,3 -2,7 -5,4 2,2 3,0 4,2 Secondary sector 3,6 1,3 3,1 4,9 -1,9 2,7 4,4 5,5 Extractive industries -3,4 -16,1 -2,6 8,4 -3,7 1,0 1,4 2,4 Including: Hydrocarbons -3,6 -16,4 -2,7 8,5 -3,7 1,0 1,4 2,4 Agro-food industries 5,7 7,5 4,0 2,5 -1,2 3,7 4,5 5,2 Other manufacturing industries 4,4 5,6 3,3 5,4 -4,2 3,0 5,2 5,8 Electricity production and distribu- 3,3 5,9 1,2 0,3 -0,6 4,9 5,8 5,4 tion Water production and distribution and -1,4 6,5 2,6 1,7 1,5 3,0 4,0 4,0 sanitation Building and construction 10,4 8,9 7,6 4,7 1,3 2,5 5,8 8,1 Tertiary sector 4,9 4,3 4,4 3,0 -3,4 3,7 4,0 3,7 Trade and vehicle repairs 5,6 4,5 5,1 4,2 -1,7 3,8 4,4 4,0 Restaurants and hotels 6,6 5,3 4,3 1,8 -19,2 5,7 5,2 6,0 Transports. warehousing. communi- 2,2 4,2 4,0 3,5 -7,8 2,8 4,4 5,0 cations Information and telecommunications 6,0 5,7 -2,3 3,9 3,0 4,0 4,3 4,4 Banks and financial institutions 5,2 6,0 10,2 6,2 -1,9 4,7 5,8 4,2 Other market services 5,9 3,2 4,3 1,0 -5,8 3,5 3,5 3,5 Public services. social security 3,6 4,8 3,5 1,7 -1,6 4,0 3,3 2,4 Other non-market services 4,0 3,9 4,2 3,2 0,3 2,9 2,7 2,3 GDP at factor costs 4,5 3,3 4,1 3,5 -2,6 3,3 4,1 4,4 GDP 4,6 3,5 4,1 3,7 -2,6 3,3 4,1 4,4 Source: MINFI
8.3. Government’s Strategy for the 2021-2023 Period
Over the 2021-2023 period. the macroeconomic outlook will depend. on the one hand. on external factors such as the duration of the pandemic. trends in commodity prices and global demand and. on the other hand. on domestic factors relating in particular to the effectiveness of Government’s measures to preserve jobs and revive the economy. After the contraction of 2020. Cameroon’s economy is expected to recover gradually as from 2021. which would make it possible to restore growth.
Government’s economic policy over this period is based on a structural pillar and an economic situation pillar. The structural pillar involves the implementation of the first triennium of Cameroon’s National Development Strategy (NDS 30). The second pillar concerns the
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concurrent implementation of two plans. namely: an economic recovery plan as part of the national economic recovery policy. and a support plan for the production and processing of mass consumption products. as part of enhancement of its economic sovereignty for more endogenous growth.
8.3.1. Guidelines of the first triennium of Cameroon’s National Development Strategy (NDS 30)
This part summarizes the strategic guidelines on which the public policies that Government intends to implement between 2021 and 2023 are based. The guidelines cover the four pillars of the second phase of the Vision which are: structural transformation. development of human capital and well-being. promotion of employment and economic inclusion. and governance and decentralization.
Structural transformation of the economy
The main actions to be undertaken for the structural transformation of Cameroon’s economy are: (i) build infrastructure which can effectively contribute to strengthening the productive system; (ii) modernize production factors in the rural and agricultural sector; and (iii) promote research and innovation.
With regard to infrastructure development. the Government would: (i) finalize and commission major first-generation projects. as well as launch the implementation of second-generation projects; (ii) begin the reconstruction of the North-West. South-West and Far North Regions and; (iii) formulate a public infrastructure maintenance and renovation policy.
Concerning the rural sector. Government’s actions will. first of all. focus on opening up agro- pastoral and fish producing areas with a view to reducing production costs which remain high in the primary sector. To this end. one of the main activities to be carried out will be to pursue the construction and maintenance of rural roads. Then. measures to mechanize and modernize agriculture will be intensified with the aim of increasing agricultural sector productivity.
With regard to the Industries and Services sector. Government will put a premium on promoting the “made in Cameroon” brand in agro-industry. wood. textile. mining and metallurgy. pharmaceutical and biomedical industry. etc. To achieve this. economic zones will be created. facilities will be granted to local producers. especially national champions. In addition. to promote technological catch-up. Government plans to encourage research and development and innovation. and promote standards.
Human capital development
Human capital refers to the need to have healthy and well-trained men and women. capable of bringing about the structural transformation of the economy. Such human capital must be covered by a social protection system that helps them to better cope with any socioeconomic risks that may occur at any point in time. To achieve this. the key elements to be considered are:
- improving the technical capacity of health facilities in rural and remote areas which will be the major priority in the health sector between 2021 and 2023. in order to improve healthcare delivery and quality. and reduce child and maternal mortality in those areas;
- improving the quality of education. in particular by revising syllabuses. creating links between
152 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW various types and levels of education. adapting training to the socio-economic environment. developing the competency-based approach. and developing appropriate strategies to further get schools closer to the population. Efforts will be devoted to increasing the delivery of technical and vocational education in the educational system in order to improve the employability and socio-professional integration of young graduates. Another strategic priority area is the formulation of a textbook policy;
- ramping up incentives for informal sector enterprises to migrate to the formal sector. in order to facilitate the management of the economy and improve compliance with regulations relating to working conditions;
- enhancement measures to empower socially vulnerable persons (women in distress. persons with disabilities. refugees and displaced persons) in order to increase their contribution to the creation of national wealth (GDP).
- diversifying and extending direct (cash/in-kind) and indirect transfer programmes to strengthen non-contributory social security mechanisms.
Promoting employment and socioeconomic integration
The overall objective here is to promote access to decent jobs for the greatest number of workers through the multiplication and promotion of job creation opportunities in the economy by: (i) promoting employment in public investment projects; (ii) improving productivity. employment and income in rural areas; (iii) developing VSEs. SMEs and young entrepreneurship; and (iv) improving labour market regulation.
Governance
The strategic orientations of governance for the next three years are set out below:
Political governance
In this area. the Government is committed to strengthening and consolidating the decentralization process. Consequently. the implementing instruments of the Code on Regional and Local Authorities enacted in December 2019 will be signed. In addition. necessary actions and measures will be taken for the operationalization of the regions. in particular the North-West and South-West regions with special status. To strengthen national unity and consolidate the democratic process. Government intends to carry out actions aimed at promoting bilingualism. multiculturalism. citizenship awareness and patriotism as well as equitable participation of all social strata in national life.
Administrative. economic and financial governance
Administrative and financial governance is hinged on generalizing results-based management across the public sector and improving accountability in the management of public resources. Particular focus will also be on stepping up measures to curb corruption and embezzlement of public funds. Priority will also be given to implementing measures to improve the business environment. in particular those with a positive impact on investment and entrepreneurship.
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8.3.2. Post-COVID-19 economic recovery plan
This stimulus plan aims to provide substantial support not only to industries that are negatively impacted by the pandemic. but also to those with a significant knock-on effect on the rest of the economy. Thus. the plan is expected to help preserve economic activity and jobs. and create conditions for a rapid return to the pre-crisis level of activity and prepare for the future. It is broken down into four main components: (i) budgetary consolidation; (ii) development of appropriate and dedicated business financing systems; (iii) revamping growth-driving sectors; and (iv) enhancing the competitiveness of enterprises.
Component 1: budgetary consolidation
The COVID-19 pandemic disrupted a markedly improving public finance trajectory. In order to restore budgetary sustainability over the long term. Government should continue efforts aimed at preserving a viable macroeconomic framework. implementing structural reforms and enhancing transparency in the management of public finances.
Component 2: Developing appropriate and dedicated enterprises’ financing systems
The COVID-19 health crisis has resulted in a significant downturn in the level of activity in several enterprises and compromised their ability to meet some of their commitments towards credit institutions. This situation. coupled with the uncertainty surrounding the containment of the pandemic both in the country and among our main trading partners. is expected to further tighten the conditions for many companies to access bank financing. The Government plans to put in place appropriate mechanisms to address difficulties in accessing financing from the top and bottom of enterprises’ balance sheets. through specific financing lines in banking institutions.
Component 3: Revamping growth-driving branches or sectors
In addition to its health-related impacts. the COVID-19 pandemic has affected the functioning of enterprises. in connection with the restrictions imposed by Government to limit its spread. Moreover. given that they constitute the main transmission channels of the disease. some branches of activity have been hard hit by the pandemic. including (i) tourism. accommodation and catering; (ii) pharmaceutical industries; (iii) other chemical industries; (iv) agriculture and forestry; (v) fishing; (vi) trade; (vii) Civil engineering and public works; and (viii) agribusiness.
The aim here is to increase local supply. meet domestic demand and make inroads into international markets. with priority actions to ensure the resumption of activity in companies of the sectors most affected by the pandemic. by boosting growth-driving branches/sectors.
Component 4: Strengthening the competitiveness of enterprises
The COVID-19 health crisis has generated an increase in some operating expenses of enterprises. thus reducing their profits. In addition. it has exposed the challenges inherent in low levels of
154 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW processing and difficulties in conserving rural sector products. Emphasis will be placed on adopting measures to reduce factor costs. especially for very small (micro) enterprises. as well as small- and medium-sized enterprises operating particularly in the agricultural sector. such as: (i) strengthening rural infrastructure and equipment; (ii) opening up of production areas. (iii) building the capacity of actors in value chain development techniques; (iv) supporting producers in purchasing agricultural and veterinary inputs; and (v) facilitating access to domestic and international markets.
8.3.3. Support plan for the production and processing of mass consumer goods
Due to the COVID-19 pandemic. the concept of globalization has been put to question. as it has made economies to be seen as inward-looking. The break in global supply chains. particularly with regard to food and basic goods. was further worsened when producer countries deliberately decided to suspend exports. on the grounds that their populations themselves needed the products. In the same light. other countries announced the political will to relocate home industries located abroad in order to free themselves from external dependence for these goods which they can produce. Indeed. this crisis offers an opportunity to kick-start brainstorming on which post-crisis economic policy adjustments will have to be made. In this context. over the 2021-2023 period. Government will focus more on the import-substitution policy as the main lever for strengthening its economic sovereignty to ensure more endogenous growth.
The Production Support Plan will focus on ensuring increased production and processing of consumer products in order to initiate the gradual rebalancing of the trade balance. The main food products concerned are: rice. fish. wheat. milk and maize. These five products accounted for about 70% of food imports in 2019. The import bill for these five food products increased from 486.7 billion in 2015 to about 542 billion in 2019. They account for more than a third of the overall trade deficit.
It should be noted that this plan does not replace the duties of various ministries. It provides greater clarity on the crucial issue of import substitution of consumer products. One of the main thrusts of this plan is to ensure more efficient regulation of domestic and external markets.
8.4. Macroeconomic and budgetary projections for the 2021-2023 period
8.4.1. Macroeconomic projections over the 2021-2023 period
In 2021. Cameroon’s economy is projected to grow at 3.3% after contracting by an estimated 2.6% in 2020. This growth rate reflects a real GDP of 16 960.6 billion in 2021. lower than projected in the ‘pre-crisis’ growth trajectory (18 272 billion). that is a 7.2% decrease. Thus. despite the rebound expected in 2021. the economy would be performing below its pre-crisis level and the real GDP level in 2021 would only be closer to that of 2019. implying a two-year lag compared to the initial growth trajectory of our economy.
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Graph 31: GDP Trajectories With and Without the Crisis
Source: MINFI/DP
In the medium term. to get the economy back on its pre-crisis growth trajectory. Government should effectively implement its recovery plan. Average real growth would then stand at 4% before aligning with the potential growth trajectory. An analysis of the shift from the potential growth trajectory reveals that the effects of the pandemic on the economy will only begin to dissipate by 2025. By way of comparison with the 2008 crisis. the consequences on the economy. assessed through the gap between actual production and potential production. were only overcome (positive gap) in 2013. that is. five years later.
Box 2: Potential Growth and Medium-term Scenario The paper presented in this box seeks to determine the time needed for Cameroon’s economy to return to its pre-crisis growth trajectory. following the shock of the COVID-19 pandemic.
To this end. the comparative method is used between potential GDP and actual GDP. Potential GDP is defined as the GDP level obtained using the full capacities of factors of production (labour and capital). Generally. the economy changes with cycles which mainly stem from aggregate demand movements. in relation to a level of aggregate supply which changes relatively slowly in the long term. During recession periods. there are factors of production that are not fully utilized due to insufficient actual demand. This results in an output gap between potential GDP and actual GDP. The output gap indicates the position of the economy in its cycle of development. A positive output gap means that the actual output is greater than the output at full capacity. A negative output gap means that real output is less than what could be produced if the economy was operating at full capacity.
There are several methods of estimating the output gap. In this paper. two methods have been examined: (i) the linear trend method which supposes a constant potential growth rate and does not include a structural change such as the impact of a crisis; and (ii) the HP (Hodrick- Prescott) filter method according to which every crisis (short or long) has a significant and lasting effect on potential output. leading to a reduction of the post-shock outlook.
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Output gap according Output gap according to the linear trend Real GDP growth to the HP filter method method 2010 -2,0 -2,2 3,4 2011 -2,1 -2,2 4,1 2012 -1,8 -1,9 4,5 2013 -0,7 -0,9 5,4 2014 0,9 0,7 5,9 2015 2,2 2,2 5,7 2016 2,7 2,8 4,6 2017 2,0 2,5 3,5 2018 1,8 2,9 4,1 2019 1,3 3,1 3,7 2020 -4,5 -2,9 -2,6 Source : MINFI/DP
In the final analysis. we opted for the linear trend method because the COVID-19 crisis would not cause a shock that would lead to a drop in the level of aggregate factor productivity. but would lead only to a slowdown in its growth. The slowdown is linked to the under- utilization of the economy’s production capacities. Thus. after having widened markedly from 2008 to 2013. following the 2008 economic crisis. the output gap has gradually narrowed since 2014. in connection with the positive effects of increased public investment that started in 2009. Consequently. over the 2008–2015 period. public investment reached 5.1% of GDP on average per year. that is. more than twice the 2000–2007 average. GDP growth between 2012 and 2016 was higher than that of potential GDP. which was around 4.2%. The economy’s output gap after the 2008 crisis remained negative for 5 years (between 2009 and 2013). reflecting the time taken to get back to a pre-crisis equilibrium level. In 2018. Cameroon’s economy was close to its potential thanks to implementation of the Economic and Financial Programme concluded with the IMF. The estimated output gap for 2020 (-4.5 points) is historically the lowest. due to the sharp drop in effective GDP in 2020. The output gap is projected to remain negative beyond 2025. but would begin shrinking as from 2025. However. the effective implementation of the economic recovery plan could help to quickly close production gaps over the 2020-2025 period. From 2022. the implementation of the stimulus plan would lead to an increase in activity. thus helping to return to the pre-COVID-19 GDP level. As a reminder. with the 2008 crisis. it took five years for the economy to return to its pre-crisis situation. but with the current crisis which is extremely severe. it could take longer for the economy to return to its pre-crisis situation.
The graph below shows how the economy is shifting from its potential and how long it could take to return to its normal growth trajectory.
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Production Gap (in potential GDP point), Effective Growth, Potential Growth
Source: MINFI/DP The macroeconomic outlook for the 2021-2023 period can be assessed for each of the four institutional sectors. namely: real sector. external sector. public sector and monetary sector. Focus will be on the public sector. in particular budget projections and their underlying assumptions.
Real sector
The primary sector is expected to grow by 3.4% in 2021. It is projected to grow by an annual average of 4.2% over the 2021-2023 period. This projection is linked to the combined effects of good rainfall as well as the implementation of measures aimed at increasing the production and productivity of food crops. with a view to ensuring food security and providing inputs to food processing units. Several ongoing programmes and projects aim to improve yields. expand cultivated areas. regenerate farms and contribute to the understanding of technical production processes. Other factors would contribute to improved production. in particular because of increased downstream demand by agro-industries. following the intensification of the local processing of certain crops (maize and millet for brewing industries. cocoa for cocoa processing industries). the positive effects of programmes to revamp the coffee. banana. cotton and rubber sectors and the expected increase in the prices of the main export products after the pandemic.
The secondary sector is expected to grow by 2.7% in 2021 and is projected to record an annual average growth rate of 4.2% over the 2021-2023 period. This trend is derived from improved production of crude oil and natural gas. which induces an average growth rate of 1.6% in extractive industries. Excluding hydrocarbons. the sector should benefit from the good performance of activities in the manufacturing industries. in particular the manufacture of construction materials. chemical industries and wood processing. These industries would enjoy greater supply of electrical energy. in particular through the operationalization of hydroelectric dams and the construction of electricity transmission infrastructure.
Civil engineering and public works will also drive secondary sector growth. thanks to implementation of major second-generation projects. but also the continuation of construction
158 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW and rehabilitation works on transport infrastructure. particularly roads to facilitate trade and open up production areas. so that products can be supplied to markets under the best possible conditions. to record an annual average growth rate of 3.8% over the 2021-2023 period. This trend could be associated with the expected boom in activities in trade. transport and telecommunications. in connection with increased activities in the primary and secondary sectors as well as the demand for services. The hospitality and restaurant industry would recover at a slower pace inasmuch as new waves of infection would limit travel, as would the reduction in household income and savings as a result of the recession.
From a demand perspective. the growth of Cameroon’s economy will continue to be hinged on the components of domestic demand. mainly household consumption and investment. With the various jobs created. domestic demand is expected to benefit from the effects induced by the economic stimulus measures prescribed by Government. Final household consumption. which represents 70% of GDP. is expected to increase by 4.5% on average over the period. due to an average growth rate of 5.8% in private consumption. Investment should experience an increase of 3.1% on annual average over the period under the combined effects of an increase in private investments (+2.9%) and of public investments (+4.1%).
Foreign trade is expected to be characterized. on average. by a 4.1% increase in exports of goods and services over the period and 2.6% in imports. This expected increase in exports is related to the increased production of crude oil and natural gas.
Inflation would be maintained at an annual average rate of 2.5% which is below the CEMAC community 3% threshold. This result would be obtained thanks to Government’s efforts to ensure the steady supply of markets with everyday consumer products. It can also be attributed to moderate imported inflation.
External sector
The balance of goods is projected to fall from -939 billion in 2020 to -550.9 billion in 2021. and -288.7 billion in 2022. This trend could be attributed to an increase in exports of goods by 13% of GDP in 2021. 13.1% in 2022 and 13.5% in 2023. Import of goods would drop from 15.2% of GDP in 2021 to 14.3% in 2022 and 13.7% in 2023. In 2021. the current account deficit would reduce to 4.3% of GDP against 6.11% in 2020. Between 2021 and 2023. this deficit would be 4.4% of GDP on average.
Monetary situation
Monetary policy would remain in line with that of BEAC. Money supply is expected to average 25.3% of GDP over the period. It would increase from 5 606.4 billion in 2021 to stand at 6 577.2 billion in 2023. It is expected to grow by 5.5% on average during the period under review.
To support economic activity. credit to the economy is expected to increase from 3 474.8 billion in 2021 to 3 955.7 billion in 2023. representing an increase of 6.5% on average between 2021 and 2023. Credit to the economy is projected to account for an average 15.1% of GDP over the period.
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Net foreign assets would increase from 2 421.1 billion in 2021 to 2 455.4 billion in 2023. and represent an average 10% of GDP over the period.
8.4.2. Budgetary framework for the 2021-2023 period 8.4.2.1. Budgetary framework in 2021
Government’s public finance policy for the 2021-2023 period continued to focus on budgetary consolidation geared towards reducing the budget deficit. with a view to controlling public indebtedness and ensuring balanced external accounts. It aims to gradually reduce the budget deficit to a sustainable level in the medium term. In a crisis context. the budget deficit is expected to reach 3.8% of GDP in 2020 and fall to 3% in 2021 as a result of improved mobilization of non-oil revenue and greater control and efficiency of public expenditure. In the medium term. this deficit is expected to stand at 2.8% in 2022 and 2.2% in 2023. Regarding fiscal policy. Government’s objective remains the optimal mobilization of domestic non-oil revenue. while maintaining a policy that provides economic incentives and social protection. After reaching 12.5% of GDP in 2019. the tax burden is expected to fall to 11.7% in 2020 and then rise sharply to 12.6% in 2021. Such adverse trends are directly related to the effects of the crisis. which will lead to a sharp decline in tax and social security contributions in 2020 rather than a decline in activity. thereby resulting in a mechanical decrease in the ratio. The activity rebound in 2021 is expected to symmetrically result in a smaller rebound in revenue and therefore a decrease in the ratio with a neutral overall effect over the two years. In addition to such mechanical effects. new measures have a net reduction in compulsory deductions. taking into account the measures to support enterprises in sectors heavily affected by the pandemic. Revenue mobilization will focus on: (i) broadening the tax base; (ii) securing revenue; (iii) combating tax fraud and evasion. and (iv) enhancing the efficiency of the tax administration. The following measures have therefore been envisaged: • As regards broadening the tax base and securing revenue
- the further rationalization of tax expenditure; - the optimization of the informal sector’s taxation by promoting traceable payment methods; - the readjustment of the VAT registration threshold for the best return of this tax; - the establishment of a system for monitoring tax compliance by large tax units; - the modernization of certain stamp duty collection procedures;
• As regards combating international tax fraud and evasion
- the introduction of the use of block chain technologies. big data. data mining. and artificial intelligence for better use of data for tax purposes; - the redefinition of the permanent establishment concept to take into account the development of the digital economy; - the strengthening of mechanisms for taxing illicit financial flows;
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- the tightening of the tax regime on the illegal exploitation of natural resources; - the increased use of local and international expertise through the “tax inspector without borders” mechanism; • As regards enhancing the operational efficiency of the tax administration
- the further segmentation of large tax units for a more efficient management of tax risks linked to this category of taxpayers; - the optimization of personal tax management through the establishment of specialized units; - the extension of computerization to Subsidiary Taxation Centres (STC) to enable them to enjoy the benefits of the dematerialization of tax procedures;
• As concerns economic and social promotion
- continued budgetary support to revive activity in sectors particularly affected by the COVID-19 health crisis; - the implementation of a reduced and preferential tax regime for start-ups with innovative and high growth potential projects; - the strengthening of local taxation for the optimal financing of decentralization; - increased number of online tax services available; - the generalization of electronic procedures to all categories of taxpayers.
• In the short term and particularly for the year 2021. customs revenue will be mobilized by:
- supporting legitimate trade through a thorough monitoring of borders to prevent any fraudulent entry of goods into the territory. which would harm the activities of enterprises that regularly fulfil their customs clearance formalities. In this regard. the economic space surveillance mechanism will be strengthened; - broadening the tax base. notably by reviewing the policy of taxing certain goods in order to gradually discourage their importation. or to encourage their local processing before exportation. or to limit their high consumption because of their harmful consequences on health and the environment. or to increase the autonomous resources to support decentralization and Universal Health Coverage; - improving the goods handling system through the use of risk management techniques integrated into the new CAMCIS (Cameroon Customs Information System) application; - ensuring a coordinated management of borders with neighbouring countries and information sharing on intra-regional foreign trade; - establishing an innovative system for monitoring the budgetary coverage of customs operations carried out as part of public contracts; - systematically clearing direct removal bids and customs bonded acquittals within the prescribed time limits;
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- reducing the tax expenditure incurred on goods that Cameroon is likely to produce easily. such as maize. rice. wheat. soya beans. etc.
Budgetary resources include internal revenue. and loans and grants. Internal revenue comprises oil and non-oil revenue.
Oil revenue include NHC royalty and the oil company tax. to which was added revenue from natural gas export as from 2020. Oil royalty projection is based on the following: (i) an oil production of 24.8 million barrels; (ii) an oil price of USD 43.8 per barrel. from which USD 3.5 is deducted as a discount. i.e. a barrel price of USD 40.3 in Cameroon; (iii) exchange rate of 579.8 CFA francs to USD 1. Thus calculated. the expected NHC oil royalty stands at 293.8 billion. Gas royalty projection is based on: (i) a projected production of 82 billion scf (standard cubic feed) corresponding to 13.7 million barrels; (ii) a barrel price of USD 40.3; (iii) an exchange rate of 579.8 CFA francs to USD 1. On this basis. gas royalties were estimated at 47.2 billion. Based mainly on the 2020 fiscal year income. the expected amount of oil company tax is 56.5 billion. Overall. consolidated oil revenue totalled 393 billion in 2021. A decrease of 64.8 billion compared to estimates for the 2020 financial year. Non-oil revenue is supposed to increase at the same rate as the non-oil GDP nominal growth rate plus the impact of new tax and administrative measures. In 2021. non-oil GDP nominal growth is projected at 5.0% resulting from real growth of 3.3% and a GDP deflator of 1.7%. Taking into consideration the impact of the new measures. non-oil revenue is expected to amount to 2 956.6 billion. including 1 938.1 billion in taxes and duties. 804.7 billion in customs revenue and 213.8 billion in non-tax revenue. Grants are divided into project grants and programme grants. They are projected at 106.9 billion in 2021. an increase of 4.9 billion (4.8%) over 2020. The State’s financing resources consist mainly of project loans. The issuance of government securities and budgetary support. Such resources are intended to fill the financing gap resulting from the relationship between the State’s own revenue and its total expenses and charges. For the 2021 fiscal year. the State’s financial resources are expected to total 1 393.4 billion. down by 363.1 billion compared to 2020. This drop is justified by the non-renewal in 2021 of the exceptional financial support from technical and financial partners from which the Stateof Cameroon benefited in the fight against COVID-19. including external debt relief. As regards expenditure. Government intends to guarantee the sustainability of public finances through the streamlining of public expenditure. The public expenditure ratio is projected at 20.3% of GDP in 2020 as a result of the measures adopted in response to the pandemic. In 2021. the increase in expenditure is expected to be more measured. with the two opposing effects of the lifting of emergency measures. on the one hand. and the activation of the Stimulus Plans on the other hand. The measures envisaged notably concern the following:
a Regarding current expenditure
- continued streamlining of government activities.
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- progressive reduction of the expenditure executed under derogatory procedures; - reduction of resources allocated to cover the travel expenses of government employees abroad; - operationalization of the market price of rents contracted by the State and its devolved services; - setting of telephone consumption quotas by government service and by official. a Regarding public investment
- improvement of the quality of public spending. by prioritizing public investment projects likely to allow the private sector to flourish and improve the living conditions of the people; - implementation of a rigorous planning of the resources that will be used to operate and maintain public investments already made; - reconstruction of the North-West and South-West regions; - further increase in the resources transferred to the RLAs in accordance with the regulations in force and the budgetary constraints that will be imposed.
Budgetary expenditures are subdivided into three major categories: current expenditure. capital expenditure and public debt. Current expenditure is projected at 2 335.6 billion against 2 241.0 for the 2020 fiscal year. Personnel expenses are budgeted at 1 068.6 billion. Expenditure on goods and services is expected to rise from 677.0 billion in 2020 to 736.9 billion in 2021. an increase of 59.9 billion. taking into account the strong constraints relating to organization of the 2022 AFCON. security coverage. the functioning of regional councils and health expenditure. Transfers and subsidies are projected at 528.8 billion. up by 0.9 billion from the 2019 estimate. Transfers and subsidies include 299.2 billion in subsidies and 229.6 billion in pensions. Capital expenditure is provisioned at 1 352.0 billion. up by 97.7 billion compared with the 2020 estimate. Capital expenditure is composed of 583.2 billion CFA francs of expenditure on own resources. 733.8 billion CFA francs on external funding and 35 billion CFA francs for restructuring expenditure. A provision of 180 billion is earmarked for 2021. of which 100 billion will be earmarked for the continued implementation of Government’s COVID-19 pandemic-related economic and social response and support strategy. 50 billion for the support fund for the production and processing of consumer goods. and 30 billion for decentralization. Public debt service is estimated at 982.4 billion. broken down into 491 billion for external debt and 491.4 billion for domestic debt. Compared with 2020. the public debt service is expected to fall by 49.3 billion. Eventually. the draft budget is balanced in revenue and expenditure at 4.865.2 billion. up by 232.5 billion compared with estimates at the end of 2020 and by 101.7 billion (-2.1%) compared with the Amending Finance Law for the 2020 fiscal year.
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Table 85 : Projections budgétaires 2019 LFI.2020 LFR.2020 2020 2021 2022 2023 A – OVERALL 5348,9 4951,7 4707,0 4813,2 4865,2 5241,8 5500,7 RESOURCES (I+II+III) I - DOMESTIC REVENUE 3517,2 3617,2 2848,5 2954,7 3369,7 3589,6 3913,7 1-Oil + gas revenue 584,5 443,01 269,70 328,3 393,04 406,4 490,3 - NHC Royalties 471,5 293,2 132,1 185,6 293,8 349,5 350,0 - NHC gas royalties 0,0 48,3 39,1 44,9 42,7 67,4 86,4 - Tax on oil companies 113,0 101,5 98,6 97,8 56,5 79,6 93,8 Non-oil revenue 2932,7 3174,2 2578,8 2626,5 2976,6 3183,2 3423,4 - Taxes and duties 1947,2 2103,0 1724,8 1770,4 1938,1 2088,2 2264,0 - Customs revenue 821,1 859,2 650,0 652,1 804,7 881,8 933,7 - Non-tax revenue 164,4 212,0 204,0 204,0 233,8 213,2 225,8 II – GRANTS 133,3 102,0 102,0 102,0 106,9 106,8 113,1 III - LOANS 1698,4 1 232,5 1 756,5 1756,5 1388,6 1544,7 1473,5 - Project loans 1060,3 767,0 655,0 655,0 703,4 744,0 792,7 - IMF-AfDB-AFD-WB-EU 288,1 115,5 214,5 214,5 260,0 0,0 0,0 Programme - Issue of government bonds 350,0 320,0 420,0 420,0 350,0 450,0 400,0 - Bank financing 0,0 30,0 80,0 80,0 30,0 30,0 30,0 Exceptional financing 387,0 387,0 45,2 320,7 250,8 B - OVERALL EXPENDI- 5080,3 4951,7 4707,0 4707,0 4865,2 5241,8 5500,7 TURE (I+II+III+IV) I – CURRENT 2632,7 2443,5 2241,0 2241,0 2335,5 2399,8 2446,3 EXPENDITURE 1- Personnel expenditure 1013,4 1066,2 1036,2 1036,1 1069,8 1090,4 1101,4 2- Purchase of goods and 894,6 780,0 677,0 677,0 736,9 706,5 741,2 services 3- Transfers and subsidies 724,7 597,4 527,9 527,9 528,8 602,9 603,7 II- CAPITAL 1516,7 1496,3 1254,3 1254,3 1352,0 1432,6 1523,5 EXPENDITURE * Expenditures on FINEX 822,7 796,0 684,0 684,0 733,8 774,4 824,9 * Expenditures on local resources 650,7 654,4 542,2 542,2 583,2 621,0 659,1 * Restructuring expenditure 43,3 45,9 28,1 28,1 35,0 37,2 39,5 III- SUNDRY FUNDS 180,0 150,0 123,5 60,0 IV- PUBLIC DEBT 911,1 1011,9 1031,7 1031,7 1027,7 1285,9 1470,9 * Foreign debt 497,2 472,2 492,0 492,0 536,2 690,0 898,8 - Interest 176,9 170,0 152,4 152,4 197,0 217,0 229,8 - Principal 320,3 302,2 339,6 339,6 339,2 473,0 669,0 * Domestic debt 413,9 539,7 539,7 539,7 491,5 595,9 572,1 including: - Interest 54,7 49,9 49,9 49,9 65,2 65,4 58,2 - Principal 38,9 345,8 345,8 345,8 287,8 393,5 326,9 - Amounts due 165,2 72,0 72,0 72,0 66,5 65,0 115,0 - VAT credit refund 66,0 72,0 72,0 72,0 72,0 72,0 72,0 Need / Financing ability (+/-) -268,6 0,0 -106,2 0,0 0,0 0,0 Source : MINFI
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8.4.2.2. Budget projections for the 2021-2023 period
Under macroeconomic assumptions and the fiscal policy efforts envisaged. as well asthe potential financing that the State of Cameroon can expect. projections of overall revenue and grants could reach 15% of GDP in 2021 compared with 14% in 2020. Overall revenue and grants are expected to grow at an average rate of 12% over the 2021-2023 period.
In perspective. non-oil revenue is expected to grow at an average rate of 12.3% over the period. This is likely to result in a tax pressure rate (non-oil revenue/current GDP) that would rise from 12.6% in 2021 to 13.6% in 2022. and to 14% in 2023. This trend would be essentially linked to continued efforts to optimize the mobilization of these revenues. particularly tax expenditure streamlining.
Total expenditure is projected at 17.5% of GDP in 2021. as against 17.7% of GDP in 2019. It is expected to grow at an average rate of 4.0% per year over the 2021-2022 period.
Current expenditure is expected to increase by an average of 3% per year over the period under review. It is expected to account for 11.1% of GDP in 2021. 10.9% of GDP in 2022. and 10.4% of GDP in 2023, thus reflecting the desire to control expenditure.
Capital expenditure is expected to grow by 7.0% overall in 2021. and over the period 2021- 2023. it will increase at an annual rate of 6% and account for an average of 5.8% of GDP.
Regarding overall revenue and expenditure as projected in 2021, it is estimated that the overall budget deficit will be 2.5% in 2021. including grants. compared with 3.8% in 2020. Over the 2021-2023 period. the budget deficit is expected to continue its downward trend. in line with the objective of consolidating budgetary policy to an average of 1.6% of GDP. Table 86: Key Macroeconomic Indicators History Estimates Projections 2016 2017 2018 2019 2020 2021 2022 2023 Real sector GDP at current prices (CFAF 19345 20328 21493 22855 21856 22973 24383 25953 billion) Oil GDP 623 718 1000 1064 708 762 880 895 Non-oil GDP 18722 19610 20493 21791 21148 22211 23503 25058 GDP at constant prices 15093 15629 16264 16854 16425 16974 17676 18455 Oil GDP 1011 846 823 893 860 869 881 902 Non-oil GDP 14082 14783 15441 15976 15565 16105 16796 17554 Annual growth (in %) GDP at constant prices 4,6 3,5 4,1 3,7 -2,6 3,3 4,1 4,4 Oil GDP -3,6 -16,4 -2,7 8,5 -3,7 1,0 1,4 2,4 Non-oil GDP 5,3 5,0 4,4 3,5 -2,6 3,5 4,3 4,5 Price GDP Deflator 1,1 1,5 1,6 2,6 -1,7 1,8 2,0 2,0 Oil GDP Deflator -17,6 37,9 43,0 -2,0 -30,9 6,4 13,9 -0,6 Non-oil GDP Deflator 1,6 -0,2 0,0 2,8 -0,4 1,5 1,5 2,0 Consumer prices 0,9 0,6 1,1 2,5 2,5 2,5 2,5 2,5
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History Estimates Projections 2016 2017 2018 2019 2020 2021 2022 2023 Export prices -8,0 3,1 7,4 -0,5 -14,4 1,6 5,5 -0,4 including Cameroon oil -15,4 21,4 24,8 -5,0 -33,0 5,9 12,9 -0,6 prices Import prices -6,7 -0,3 2,5 -0,8 0,8 0,4 1,0 1,7 Terms of trade -1,2 3,4 4,9 0,4 -15,2 1,3 4,6 -2,1 Demand components (As a percentage of GDP) Consumption 82,1 81,1 81,6 81,8 82,3 79,3 79,1 81,0 Private 70,0 70,0 70,5 71,0 70,6 67,9 68,6 71,5 Public 12,1 11,1 11,1 10,9 11,6 11,4 10,5 9,5 GFCF 22,6 23,0 22,8 22,6 24,5 26,4 26,2 23,8 Private 17,8 18,6 18,8 18,5 20,1 21,9 21,7 19,3 Public 4,8 4,4 4,0 4,0 4,4 4,5 4,5 4,4 Goods and services exports 19,2 18,6 19,3 20,2 16,6 17,9 17,9 17,2 Goods and services imports 24,0 22,6 23,7 24,7 23,4 23,7 22,8 22,0 Public sector (as a percentage of GDP) Total revenue and grants 14,7 15,0 15,7 15,7 13,7 14,8 15,7 16,3 Oil 2,2 1,9 2,3 2,6 1,5 1,7 1,7 1,9 Non-oil (fiscal pressure) 11,9 12,3 12,6 12,5 11,7 12,6 13,6 14,0 Non-oil (non-oil GDP %) 12,3 12,8 13,2 13,2 12,1 13,1 14,1 14,5 Expenditure 20,9 18,8 18,5 19,3 17,7 18,0 17,5 16,8 current 12,9 11,2 11,3 12,5 11,2 11,3 11,0 10,5 capital 7,8 7,2 6,5 6,6 5,7 5,9 5,9 5,9 Overall fiscal balance (scheduling basis) Excluding grants -6,4 -4,1 -2,9 -3,9 -4,2 -3,3 -2,0 -0,7 Including grants -6,2 -3,8 -2,5 -3,3 -3,8 -2,8 -2,0 -0,7 Reference budget balance -5,3 -3,3 -2,9 -4,1 -3,4 -2,9 -1,7 -0,9 (CEMAC) Non-oil primary budget -7,6 -4,9 -3,9 -4,8 -4,3 -3,4 -2,1 0,0 balance External sector Current account balance -3,2 -3,4 -3,5 -2,8 -6,4 -4,3 -4,5 -4,3 Monetary situation (nominal growth) Money stock (M2) 5,3 5,9 14,4 7,4 3,5 3,8 4,8 7,8 Net external assets 8,6 15,5 5,2 13,9 2,7 -0,1 0,6 0,8 Credit to the economy 5,9 2,6 12,1 0,2 -4,2 6,0 4,6 8,9 Source : MINFI
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GLOSSARY OF ACRONYMS
ADC Cameroon Airports Authority AFD French Development Agency AfDB African Development Bank AFR Annual Forestary Royalty AIPO African Intellectual Property Organization ALUCAM Cameroon Aluminium Company AMC Approved Management Centre ANAFOR National Forest Development Support Agency APPME Small- and Medium-Sized Enterprises Promotion Agency ARV Antiretroviral BDEAC Development Bank of Central African States BEAC Bank of Central African States BEPC Brevet d’Etudes du Premier Cycle (equivalent of the GCE Ordinary Level) BICEC Banque Internationale du Cameroun pour l’Epargne et le Crédit BTA Fungible Treasury Bonds BTP Civil Engineering and Public Works C2D Debt Reduction and Development Contract CAMAIR CO Cameroon Airlines Corporation CAMPOST Cameroon Postal Services CAMRAIL Cameroon Railways CAMTEL Cameroon Telecommunications CAMWATER Cameroon Water Utilities Corporation CAP Certificat d’Aptitude Professionnelle (Vocational Training Certificate) CAPAM Small-Scale Mining Support and Promotion Framework CAPIEMP Grade I Teachers’ Certificate CAPIET Grade I Technical Education Teachers’ Certificate CARFIC Cameroon Rural Financial Corporation CBC Commercial Bank Cameroon CEMAC Central African Economic and Monetary Community CFC Cameroon Housing Loans Fund CFCE Business Development Centre CICC Cameroon Industrial Cotton Corporation IPRC Inter-ministerial Programmes Review Committee CIG Common Initiative Group CIMA Inter-African Conference on Insurance Markets CIMENCAM Les Cimenteries du Cameroun CIRAD International Cooperation Centre on Agronomic Research for Development CNSC Cameroon National Shippers’ Council
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CNUCED United Nations Conference on Trade and Development COBAC Central African Banking Commission CT Corporate Tax DGC Directorate General of Customs DGTFMC Directorate General of the Treasury. Financial and Monetary Cooperation DSX Douala Stock Exchange ECAM Cameroon National Household Survey ECCAS Economic Community of Central African States ECMR Cameroon Bond EESI Employment and Informal Sector Survey EITI Extractive Industries Transparency Initiative ENIET Government Technical Teachers’ Training College Douala Stock Exchange ENS Higher Teachers Training College Emprunt Cameroun ENSAI National Advanced School of Agro-Industrial Sciences ENSET Higher Technical Teachers’ Training College FAO United Nations Food and Agriculture Organization FCTS Fire. Casualty and Transport Insurance DF Division of Forecast FDI Foreign Direct Investment FEICOM Special Council Support Fund for Mutual Assistance FMU Forest Management Unit FODECC Cocoa and Coffee Development Fund GCE General Certificate of Education GDP Gross Domestic Product GESP Growth and Employment Strategy Paper GFCF Gross Fixed Capital Formation GSS Government Secondary School GTICC Government Technical. Industrial and Commercial College GTTC Grade I Teachers Training College GUCE One-Stop-Shop for Foreign Trade HEVECAM Cameroon Rubber Corporation HIV Human Immunodeficiency Virus IDA International Development Association IFC International Financial Cooperation IMF International Monetary Fund IsDB Islamic Development Bank MAETUR Urban and Rural Land Development Authority MDG Millennium Development Goal MDRI Multilateral Debt Relief Initiative
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MFI Microfinance Institution MINADER Ministry of Agriculture and Rural Development MINEDUB Ministry of Basic Education MINEFOP Ministry of Employment and Vocational Training MINEPAT Ministry of the Economy. Planning and Regional Development MINEPDED Ministry of Environment. Nature Protection and Sustainable Development MINESEC Ministry of Secondary Education MINESUP Ministry of Higher Education MINFI Ministry of Finance MINFOF Ministry of Forestry and Wildlife MINMAP Ministry of Public Contracts MINMIDT Ministry of Mines and Technological Development MINPMEESA Ministry of Small- and Medium-Sized Enterprises. Social Economy and Crafts MINTOUL Ministry of Tourism and Leisure MIRAP Essential Goods Supply Regulation Authority MMBTU Millions of British Thermal Units MPC Monetary Policy Committee NEF National Employment Fund NGO Non-Governmental Organization NIS National Institute of Statistics NSIF National Social Insurance Fund OBC Office du Baccalauréat du Cameroun OCDE Organization for Economic Cooperation and Development OTA Fungible Treasury Bill PA Public Administration PAD Port Authority of Douala PERFAR President’s Emergency Plan for Aids Relief PGI Protected Geographical Indication PIB Public Investment Budget PIIASI Integrated Support Programme for Informal Sector Activities PIT Personal Income Tax PNLP National Malaria Control Strategic Plan RDA Regional Development Authority SAFACAM Société Africaine Forestière et Agricole du Cameroun SCB Société Commerciale de Banques au Cameroun SCBC Standard Chartered Bank Cameroon SDR Special Drawing Rights SEMC Société des Eaux Minérales du Cameroun SEMRY Yagoua Rice Expansion and Modernization Corporation SGBC Société Générale de Banques du Cameroun SME Small- and Medium-size Enterprise
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SMI Small- and Medium-scale Industry NHC National Hydrocarbons Corporation SNI National Investment Corporation SOCAPALM Société Camerounaise de Palmeraies SOCATRAL Société Camerounaise de transformation d’aluminium SODECAO Cocoa Development Corporation SODECOTON Cotton Development Corporation SODEPA Animal Production Development Company STPP Special Tax on Petroleum Products TB Treasury Bond UNICEF United Nations Children’s Fund UNO United Nations Organization USAID United States Agency for International Development VAT Value Added Tax VSME Very Small- and Medium-size Enterprise WEO World Economic Outlook WHO World Health Organization
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EDITORIAL BOARD PUBLISHER MOTAZE Louis Paul Minister of Finance
DIPUTY PUBLISHER YAOUBA Abdoulaye Minister Delegate
SUPERVISION EDOA Didier Secretary General/MINFI
TECHNICAL COORDINATOR NGAKOUMDA Gabriel Head of Division of Forecast/MINFI
TECHNICAL TEAM MOHAMADOU AMINOU Head of the Macroeconomic Synthesis Unit/MINFI/DF MANGA Thierry Assistant Research Officer/MINFI/DF MENDOUGA Serge Hervé Assistant Research Officer/MINFI/DF WAKAM Ignace Assistant Research Officer/MINFI/DF BEYINA EDZANA YVES P Assistant Research Officer/MINFI/DF ZOA Marc Assistant Research Officer/MINFI/DF ABBA SANDJABE Assistant Research Officer/MINFI/DF FOTSING SILIENOU Assistant Research Officer/MINFI/DF NDONGO René Carole épse ONANA Assistant Research Officer/MINFI/DF
EDITORIAL STAFF AND READING
DJOUFACK Yves Head of the Balance of Payment Unit/MINFI/DF MOHAMADOU AMINOU Head of Macroeconomic Synthesis Unit / MINFI/DF NKAKE EDINGUELE Zacharie Head of the Public Finance Follow-up Unit /MINFI/DF LELE TAGNE BERLIN Head of the Real Economic Follow-up Unit/MINFI/DF NANA Jacques Barnabé Head of the Monetary Analysis and External Sector Unit /MINFI/DF AWONO Fréderic Head of the Informatic Unit/MINFI/DF
ZIBI ATANGANA Jean Assistant Research Officer/MINFI/DF BANGUE Charles Assistant Research Officer/MINFI/DF FOKA Félix Assistant Research Officer/MINFI/DF DONGMO TSANGUE Christian Assistant Research Officer/MINFI/DF NGALLE Marie-Noël Assistant Research Officer/MINFI/DF ABESSOLO Petit Raoul Assistant Research Officer/MINFI/DF ASSENA NYANG C. M. E. Assistant Research Officer/MINFI/DF DAYWANE Sylvie Epse MANDO Assistant Research Officer/MINFI/DF
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MOUTHE Joseph Janvier Assistant Research Officer/MINFI/DF OMBE Antoinette Raïsa Assistant Research Officer/MINFI/DF WAYANG Assistant Research Officer/MINFI/DF ZINGA LEBOGSO R Assistant Research Officer/MINFI/DF PENDA Simon Micarel L Assistant Research Officer/MINFI/DF NDOUMBE LOBE Benoit Assistant Research Officer/MINFI/DF TONYE Jacques Assistant Research Officer/MINFI/DF NGOUING NGOUING Moise Assistant Research Officer/MINFI/DF TCHINDA Christine Assistant Research Officer/MINFI/DF MOUSSA Joseph Assistant Research Officer/MINFI/DF NDIKWA DESMOND W Assistant Research Officer/MINFI/DF MAIGONWA Lydie Assistant Research Officer/MINFI/DF KAMSEU TCHOUTAT J Assistant Research Officer/MINFI/DF BENGONO ASSOMO Marie Assistant Research Officer/MINFI/DF ABESSOLO Boniface René Senior Staff/MINFI/DF AKOULA Christian Senior Staff/MINFI/DF METSAMA Martin Senior Staff/MINFI/DF MAOUMBE KAMDOUM Carielle Senior Staff/MINFI/DF MENGUE Willie Arnaud Senior Staff/MINFI/DF KAYO WAFFO Donald Archantie Senior Staff/MINFI/DF OTOLO BINELI Rodrigue Senior Staff/MINFI/DF DONGMO GAPGHO Boris Joel Senior Staff/MINFI/DF
BASSORO Aminou P/CTPL MEBADA Grégoire SP/CTS MBIENDA Armand Head of Division of budget Preparation / MINFI/DGB MENDO Paulin MINEPAT OLOMO ATEKE Engelbert MINEPAT FOHOPA Remon MINEPAT NHIOMOG Liliane Leonie Nadia MINFOF DEFFO Achile Carlos CE/INS OUMAROU IBN EL Hamid CE/INS DJENAOUSSI Sébastien MINEPIA KOAGNY TEWANE Eliezer CE/CTS MBENG ETOUNDI Narcise MINEE KOUOGUENG Yannick MINEPAT MBEMYA MINADER BODO MVOGO MINADER MBIADA KEMAJOU Vanina MINFI/DGD MOHAMADOU BABA CAA
172 REPORT ON THE NATION’S ECONOMIC, SOCIAL AND FINANCIAL SITUATION AND OUTLOOK 2021 FINANCE LAW ALEME Melissa CAA TABI MANI Jean L.B. INS CHEO GODLOVE MINFI/SG/CT ESSOUMAN ELLAH Hyacinthe J. Trainee KITOUME OLEMBE Pascale A. Trainee NGUIATEU TCHEUTCHOUA Alix Trainee VANGU Jonathan Trainee MBOMBO PAPE MWELI David Trainee NZEUKOC Anicet Trainee KOAGNE FONGUIENG Florette Trainee LEKANE ZOLEFACK Chantal Trainee Carol KENGNE GJOUEGO Maeva Trainee Babelle MOUNDE MFORIFOUM Hakim Trainee KONCHE MOPO Borel Wilfried Trainee TSOALA DJOUNDA Firmin Trainee DINOCKDINOCK Yvan Bienvenu Trainee NKAMENI DaNIEL Trainee WAFO KANKEU Christian Borel Trainee AMADOU MANSOUR Trainee
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