Cameroon: Cameroon Outlook for 2013-17

The country (Cameroon) is situated in Western Africa and is bordering the Bight of Biafra, between Nigeria and Central African Republic for 797 km, Gabon for 298km, guinea
Land in Cameroon is various, with coastal plain in southwest, dissected plateau in center, mountains in west, and plains in north.The climate varies with terrain and from tropical along coast to semiarid and hot in north.
African language groups, English (official), French (official).

Political Context

Cameroon’s ruling party, the Cameroon People’s Democratic Movement (CPDM), has long dominated the country’s political landscape and currently occupies 148 out of the 180 seats in the National Assembly and 81 out of the 100 seats in the Senate, which was created in 2013. Presidential elections are scheduled for 2018. While Cameroon has enjoyed peace for a lot of decades in spite of its highly diverse people, it presently faces and increasingly challenging situation in its northern regions, where Boko Haram’s war, has shifted to suicide attacks since October/November 2015 with regular attacks. An estimated 93,000 Cameroonians have been displaced internally and Cameroon is as well host to an estimated 65,000 Nigerian refugees in the north and 250,000 refugees from CAR in the east.

Social Context

Despite additional than a decade of economic increase, poverty in Cameroon has remained almost unchanged since 2001. Poverty decreased from 40% in 2001 to 37.5% in 2014. Urban poverty declined from 18% in 2001 to an estimated 9% in 2014. However in rural areas, the % of poor increased from 52% in 2001 to 56.8% in 2014.

Changes in poverty between 2001 and 2014 show an unambiguous regional pattern, with northern Cameroon becoming poorer and southern Cameroon becoming wealthier. In 2014, 56% of all poor in Cameroon lived in the two northern regions, North and Far North. In the northern region, per capita consumption declined since 2001 (by about 15%), it increased in the south by approximately 50%. The commensurate decline in poverty in the southern part of the country can be attributed to favorable world market prices for export crops, artisanal gold mining, and an urbanization process that creates positive spillovers to rural areas through increased request for produce, transfers and opportunities for work.

The increase in poverty in northern Cameroon is of great concern. The number of poor people in the North and Far North regions additional than doubled from 2.1 million in 2001 to 4.5 million in 2014. Moreover this was measured prior to the security crisis created by Boko Haram. Additional up to date poverty estimates do not exist, but one would expect a significant increase in poverty in the northern regions as a consequence of the influx of refugees, and the disruption of business due to increased levels of insecurity.

Economic Overview

Over the last decade economic increase has averaged 4% and was still too low to make a critical dent in poverty reduction. Increase is estimated to have increased by 6.2% in 2015 compared to 5.9% in 2014, mainly due to expanding oil production which increased by 28%, following the reactivation and use of enhanced recovery techniques to optimize production from mature fields. Several non-oil sectors as well continued to benefit from evolution in the implementation of the “Vision 2035” program which aims to make the country an upper-middle gain economy by 2035.

Although Cameroon is less dependent on oil than other African oil exporting nations, oil revenue accounts for about 20% of total revenue and about 45% of total exports. Therefore, the oil price decline has had an impact on Cameroon’s economic outlook. The insecurity caused by the presence of Boko Haram in the Far North region has as well affected the economy. External financing mobilized to fund major infrastructure projects has increased the stock of public deficit to 26.7% of GDP at the end of 2015 from 22.9% in 2014. The 2015 joint International Monetary Fund-World Bank Deficit Sustainability Analysis (DSA) revealed that Cameroon’s risk of external deficit distress moved from moderate risk in 2014 to high risk in 2015.

In recent years, the tertiary sector has been the major driver of economic increase, with telecommunications, transport, and financial services being particularly dynamic. This increase would have been higher in the absence of the drastic breakdown of international oil prices and the insecurity in northernmost regions of the country which seriously affected agro-pastoral activities, trade between Cameroon and its neighbors (Nigeria, Chad, and the Central Africa Republic), and the tourism sector.

Development Challenges

Cameroon suffers from weak governance, which affects the country’s development and ability to attract investments. Cameroon ranks 130th out of 168 nations in the 2015 Transparency International corruption perceptions index. Cameroon ranks 172th out of 189 economies in the 2016 Doing Business statement.