A STRATEGIC FRAMEWORK FOR FINANCING

DEVELOPMENT IN CAMEROON – TEN WAYS OF

BOOSTING SUSTAINABLE GROWTH AND

DEVELOPMENT IN VIEW OF GOVERNMENT’S

LONG TERM PLAN OF MAKING CAMEROON AN

EMERGENT ECONOMY BY 2035

Problem Identification

Development Challenges in

Cameroon

Insufficient pipe-borne

waterHigh rate of

unemployment

Lack of capital to start-up small

businesses

The practice of traditional & outdated farming methods

and lack of access to modern farming techniques

especially in rural areas

Insufficient & poorly equipped health

centers especially in rural areas

Poor road infrastructure

Sociological issues such as ignorance, poverty

and backwardness especially in rural

areas

Financing

Development in Cameroon

Road construction

Electricity Power and

Energy

Agricultural

Development

Dam construction

General Overview

The Government of Cameroon should encourage and promote modern & mechanized agriculture in order to boost agricultural productivity. This will result to large scale commercial agriculture which can aid in employment and thus poverty reduction. Both the public and private sector should harness the huge agricultural potentials in Cameroon in order to speed up development.

1 Agricultural Development

2 Development of Electricity and sustainable Energy

According to Government estimates, Cameroon is in need of about 5000MW of electricity to become an emergent country by 2035 but only currently generates about 1200MW which is far below required capacity. Hence, the Government should effectively mobilized and manage domestic resources in order to meet its energy needs. Domestic private resources should also be solicited.

3 Road Infrastructure

Road infrastructure is indispensable in the development of every economy. According to Government estimates, Cameroon has about 200,000KM of road but only 5000KM of road is tarred.

4 Construction of DamsIn order for the Government to meet current energy needs in Cameroon, it must invest more in the construction of dams in an attempt to harness and tap more energy to turn Cameroon industries. The Lom-pangar project dam, the Mekin hydro-electric project and the menv’elle project are still grossly insufficient in meeting the energy needs of Cameroon. Currently, the Government estimates that about XAF 500 Billion is lost every year as a result of insufficient energy and power supplies in the country. The state-owned company-ALUCAM (production of zinc sheets) is operating under capacity because of insufficient energy. I strongly recommend that the funds and ODA allocation for the energy sector in Cameroon should be increased substantially.

5 Provision of clean & Pipe-borne Water

This is another serious problem faced by Cameroon. According to Government, only 1/3 or approximately 33.3% of the Yaounde (capital city) urban population have access to clean pipe-borne water. The situation is worst in rural areas. This has led to serious health problems in the country especially Cholera. I strongly recommend the Government to invest in this sector in order to reduce or prevent the occurrence of a pandemic disease.

6 Public and Private Sector Financing of small and medium size enterprises

Access to capital is a serious problem in Cameroon. Conditions to take a bank loan is so difficult and complex such that only a small amount of bank credits is issued by commercial banks in Cameroon. Statistics show that only 10 out 100 Cameroonians do business with a bank (BEAC). Small business financing is imperative to boost development and sustainable growth in Cameroon. This will contribute significantly to create employment and reduce poverty in the country.

7 Fight Against Bribery and High Level Corruption

The level of bribery and corruption is just too high and constitutes a serious impediment to growth and development. Surveys and studies carried out by the National anti-corruption commission in Cameroon (CONAC) indicates a high level of embezzlement of public funds. The reports show that thousands of billions have been swindled out of the country in the past 20 years that could have been used to push ahead the development agenda.

8 Improvement in the Public Health System

In spite of the recent improvements recorded in the Cameroon public health system, the Government still has to increase its public health budget. Hospitals and health centers in most parts of the country are poorly equipped and contain only a few number of specialized health personnel. The practice of street selling of drugs by unauthorized and incompetent people is still highly prevalent.

9 Restructuration of the Banking sector and Financial Markets

Cameroon has to restructure her banking sector. The banking sector of Cameroon is very poor as compared to neighboring Nigeria. The banking sector of Nigeria is the third revenue generator to the Nigerian economy after the petroleum and Nollywood industries. Our banking sector is highly paper based banking and less on E-banking and online banking. This has deprived Cameroonians from benefitting from the $4.5 trillion volume of trading a day in the FOREX market. The banking sector is a backbone of an economy and every economy looking forward to become an emergent economy like Cameroon in it’s 2035 vision paper must restructure it’s banking sector and improve on financial inclusion.

10 Sustainable Partnership between the Public and Private Sectors

The public sector has the role of making the business climate favorable for the effective functioning and mobilization of private domestic resources in pushing ahead the development agenda. According to the World Bank doing business report, Cameroon is ranked 132 out of 189, -8 points behind the sub-saharan average of 124 out of 189. This makes Cameroon not a very favorable business environment on which to operate and therefore scares away the largest external source of private investment – Foreign direct investment (FDI). No doubt the level of FDI in Cameroon is too low still compared to the sub-saharan regional average. It is in this regard that I strongly recommend a sustainable partnership between the public and private sectors of Cameroon.

THE WAY FORWARDFor Cameroon to meet its objective of becoming an emergent country by 2035, economists in the country say it has to grow at a rate of 25% per year but currently grows at 5.9% according to World Bank estimates. Therefore, for Cameroon to meet its objective of becoming an emergent country by 2035, the Government has to focus on financing revenue generating sectors especially the energy, road infrastructure and banking sectors in order to boost sustainable growth and development. This is because in spite of the improvements in both Government and ODA allocation to these sectors of the economy, there are still under-funded.