Economical overview
Cameroon has high debt problems despite
having plenty of oil and other natural resources as well
as profitable export agriculture. One obstacle to
economic development is poorly developed infrastructure.
Widespread corruption causes public funds to disappear
in private pockets and the assets are unevenly
distributed.
At independence in 1960, the future looked good.
Productive agriculture has led to strong economic growth
for a long time. It was mainly coffee and cocoa that
went on export. In 1978, oil resources began to be
recovered, which contributed to Cameroon becoming one of
Africa's most prosperous countries. In the mid-1980s,
oil accounted for more than half of export earnings. The
money was used, among other things, for a strong
expansion of the public sector.
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Countryaah.com:
Major imports by Cameroon, covering a full list of top products imported by the country and trade value for each product category.
But when world market prices for oil, cocoa and
coffee began to fall in 1986, the Cameroonian economy
was in crisis. Gradually, Cameroon was forced to take
out large loans and the foreign debt shot up. To reduce
the debt burden, the government implemented a austerity
program in cooperation with the IMF in the late 1980s.
This meant, among other things, that the number of
public employees was reduced and that state-owned
companies were sold out. Several similar IMF programs
then followed for Cameroon.
An economic turning point came in 1994 when the value
of Cameroon's currency, the CFA franc, was written down
by a sharp devaluation. Exports gained momentum and
since the mid-1990s, growth has been relatively good.
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Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including CMR which represents the country of Cameroon.
Debt cancellation
From 1997 Cameroon managed to write off large parts
of its foreign debt. In October 2000, the country
qualified for the so-called HIPC initiative, which
targets heavily indebted poor countries and is
administered by the IMF and the World Bank. Large debt
write-offs were made against the government's efforts to
reduce poverty, fight corruption, reform the justice
system and increase respect for human rights.
During the first years after the turn of the
millennium, the government managed to keep public costs
down while striving to bring more tax money to the
Treasury. Several state-owned companies were sold:
telecommunications and electricity companies, the
railways and partly state-owned industries that produce
rubber and palm products. In 2006, Cameroon's foreign
debt had fallen to 25 percent of its value compared
with 2003 when it was at its highest. The external debt
remained at a moderate level until 2011, when it began
to rise rapidly again, in order for 2017 to be almost up
to the same level as in 2003.
Inflation is low since the government usually
subsidizes basic food and fuel when world market prices
skyrocket. Fuel subsidies in particular constitute a
costly item in the state budget, which is often deficit.
The holes in the budget are covered with aid and new
loans. Important lenders and donors are the EU, China
and the World Bank.
While debt problems have grown, growth has been
fairly good. During the 2010s, new smaller oil sources
were found, while agriculture was developed and the
government made investments in infrastructure. However,
dependence on the oil is a major concern in the long
run. Production has decreased by more than half since
the record year 1985. If no new large deposits are
discovered, the oil is estimated to last only a few more
years.
Procedure, oil accounts for just under half of export
revenue, between 15 and 20 percent of Treasury revenue,
and is the most important source of foreign currency.
Trying to broaden the economy
The ambition is to exploit other natural resources,
such as natural gas, gemstones and minerals. But foreign
companies' willingness to invest is limited due to
violent domestic conflicts and terrorist attacks (see
Current policy). The separatist uprising that broke out
in western Cameroon in the fall of 2017 has harmed the
country's economy through falling cocoa production.
Other problems are electricity shortages, poor
communications and an underdeveloped banking system that
makes it difficult for the country's own companies to
lend to investments. Many planned projects have been
dropped or hit by serious delays.
Oil exports allowed Cameroon to show a surplus in the
trade balance for many years, ie exports were greater
than imports. But since 2009, the relationship has been
the opposite. Deficits also prevail in the current
account, ie trade in goods plus trade in services. Here,
the costs that Cameroon must pay abroad for services
such as transport, insurance and other services are
weighed in. The deficits are financed with aid, loans
and money that Cameroonians abroad send home.
Besides crude oil, timber, cocoa, cotton and coffee
are important export goods. Imports are dominated by
food, machinery, electrical products and vehicles.
The country's main single trading partner was France
for a long time, but now China has taken over that role.
China, not least, buys Cameroonian unprocessed timber.
Much of the trade is done with countries in the EU,
which according to a 2009 agreement import a certain
part of the goods from Cameroon duty-free. The United
States has withdrawn some trade benefits for Cameroon
due to reports of human rights violations committed by
the Cameroonian military in the conflict with the
separatists.
The port of Douala is central to the country's
export-oriented economy. It is also important for trade
in the coastal neighboring countries of Chad and the
Central African Republic.
FACTS - FINANCE
GDP per person
US $ 1,527 (2018)
Total GDP
US $ 38,502 million (2018)
GDP growth
3.9 percent (2018)
Agriculture's share of GDP
14.3 percent (2018)
Manufacturing industry's share of GDP
15.3 percent (2018)
The service sector's share of GDP
51.8 percent (2018)
Inflation
2.1 percent (2019)
Government debt's share of GDP
39.1 percent (2018)
External debt
US $ 10,396 million (2017)
Currency
Central African Franc
Merchandise exports
US $ 4,601 million (2017)
Imports
US $ 4,827 million (2017)
Current account
- US $ 949 million (2017)
Commodity trade's share of GDP
25 percent (2018)
Main export goods
oil, oil products, timber, cocoa, cotton, coffee
(2017)
Largest trading partner
China, France, Italy, Spain, India, Belgium (2017)
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