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Thursday, October 4, 2018

36 years of Paul Biya: a mixed economic record for Cameroon

Cameroon has the strongest, most diversified, and most resilient economy in Central Africa; the country has much better withstood the drop in prices of raw materials it exports, such as oil, cocoa or wood that neighbors Cemac, highly dependent on hydrocarbons alone. This is the country we expect more than the others. This year, growth is starting again, estimated at 4% by the IMF. That's good, but very far from the account to become a middle-income country by 2035. A dream cherished in the 1980s when Paul Biya came to power, when growth was vigorous, comparable to that tigers from Southeast Asia. "Can do better," stresses external observers today. While inside the country, business leaders are impatient with the inertia of the state: this bad payer still has a big bill to settle with SMEs, and especially it is very slow to put in place reforms to improve the business climate and business productivity.

What are the strengths of Cameroon?

Agriculture is still the main driver of growth. And the big projects launched by Paul Biya to boost activity at the beginning of the decade are beginning to bear fruit.The Memve'ele dam should finally start producing and distributing electricity in the coming days or weeks. Other hydroelectric plants are in projects. Motorways, particularly between Douala and Yaoundé, are still in progress. And then the deep water port of Kribi, the pharaonic project whose first stone was laid in 2011 with money from the Chinese became a reality.Finally the cement producers are going to Cameroon, Nigerian Dangote to Turkish Medcem in the hope of participating in the lucrative Can market, the African Cup of Nations that Cameroon is looking forward to welcoming next year. The African Football Confederation is still reserved, it will give a final green light in November.

Why CAF hesitates?

CAF is concerned that the work is not completed in time. And rightly, all shipyards drag on, sometimes are stopped, because the bills have not been paid or because it lacks funding, or because the design is to review. To cope, the state does not hesitate to borrow. In particular with China, the first investor, the first trading partner and the first foreign creditor of the country. This trajectory begins to worry the lessors. Because since the country benefited from debt relief under the HIPC initiative in 2006, its debt is recovering at a brisk pace. This year it will represent 38% of Gross Domestic Product.And especially this money has often been badly used. Despite all efforts to build power stations, Cameroon is still in energy deficit.

Last dark spot, political and security tensions

The heart of the Cameroonian economy is concentrated in the south of the country.But Boko Haram's terrorism and the presence of refugees are weakening the extreme north of the country. Especially the crisis in the English-speaking part is the most penalizing. Tens of thousands of Cameroonians have fled the region, harming the west of the country, and especially the flow of cocoa.