Social and Economic Framework 12 2007

Towards a more effective economy

Cameroon’s economy depends essentially on the primary sector, which accounts for 42% of the GDP. The main sources of income are agriculture, stock breeding and fishing, the forest, mines and industry.

The devaluation of the CFA franc in January 1994, by rendering agricultural sectors more competitive, enabled Cameroon to resume economic growth.

As such, over the past 5 years the real Gross Domestic Product increased by about 4.5% (it was 4.2% in 2004) and inflation was maintained at about 1% per year. Budgetary income for the first five months of the 2005 financial year stood at 629 thousand million CFA francs against 519 thousand million in 2004.

In addition, public spending restrictions coupled with increased mobilization of oil revenue and especially non-oil revenue (notably fiscal revenue), was evidenced by the improvement of the budgetary balance.

Advantages

Apart from such advantages as the country’s geographic location and its class of dynamic entrepreneurs, Cameroon’s economy is replete with resources: agricultural (banana, cocoa, coffee, cotton, food crops, etc.), forestry, mineral and industrial

Agriculture, bedrock of Cameroon’s economy

Agriculture, a key sector of Cameroon’s economy, employs about 70% of the active population and accounts for 42% of the GDP. Cameroon’s agriculture is rich and diversified and comprises traditional agriculture and cash-crop cultivation. The major cash-crops are cocoa, coffee, cotton, banana, rubber, Irish potato and pepper. Other crops like groundnuts, sweet potatoes and plantains are grown essentially for household consumption. Agronomic research has been relaunched and is being intensified with a view to improving local productivity.

The forest

With 20 million hectares of forest, Cameroon ranks second to the Democratic Republic Congo in Africa. Measures have been taken to regulate the timber sector so as to limit the chaotic exploitation of timber and encourage local processing thereof

Mining sector

For a long time, this sector was the engine of the economy prior to the crisis of the mid-eighties. Cameroon still has 100 million tonnes of oil reserves and 115,000 million cubic metres of natural gas. Research is underway in the area of hydrocarbons.

Other mineral deposits are yet to be explored, such as bauxite (1,200 million tonnes), iron ore (300 million tonnes), rutile (3 million tonnes), tin, limestone and uranium.

Tertiary sector

With the return of both public and private investment and an increase in household purchasing power, the tertiary sector is growing stronger in the economy: handicraft, trade, transport and telecommunications sector. This includes, in particular, the informal sector which employs a majority of the active population, especially in urban areas.

Industry, prime mover of growth

Over the years, the industrial sector stood out as the true prime mover of growth. The food industry is experiencing a boom and still has many unexplored avenues. These include other processing industries like aluminium and cotton fabric production, as well as oil refining.