EMBARGO:
NOT FOR PUBLICATION BEFORE 1300 HRS GMT 14FEBRUARY 1995
PRESS/TPRB/2
10February 1995
TRADE POLICY REVIEW OFCAMEROON
Cameroon 'scomprehensive macroeconomic andstructural reform programme hasgonealong
waytowards reversing thecountry 'sprevious inward-looking anti-export policies, according toaWTO
Secretariat report onCameroon 'stradepolicies andpractices. Recent economic reform measures have
dismantled toalarge extent theextensive price controls andguaranteed producer price system while
theintroduction ofanewtariff schedule inJanuary 1994, hashelped provide alegal framework to
fightillicit trade practices andunfair competition.
Thereport saysCameroon 'sinternational trade system, including newcustoms andfiscal
regimes, arerecent changes topartofareform programme toreverse aprolonged economic downslide
triggered bythehalving ofworld petroleum prices in1986. Theensuing sharp fallsinexport revenue
andgovernment income required increasingly stringent internal measures tokeeptheoverall budget
deficit under control.
Cameroon andother countries using theCFAfrancissued bytheBankofCentral African states
weresubject toa50percentdevaluation oftheCFA franc inJanuary 1994. Thedevaluation should
helptorestore Cameroon 'scompetitiveness andachieve asustained higher levelofexports, thereby
underpinning stable growth. However, thisnowhinges inpartoncontaining inflation soastopreserve
costadvantages. Thereport saysthatwhile there aresigns thatthisstrategy might beworking,
Cameroon 's"process ofeconomic reform isstillfragile" andthat"inadequate investment levels remain
aserious constraint toasustained economic recovery." Moreover, inthelong-run, thepiecemeal pursuit
ofinvestment riskscreating ventures withuncertain long-term prospects.
Before 1994, Cameroon 'stariff yielded relatively lowrevenue because ofthewidespread use
ofexemptions, necessary inparttooffset thestrong anti-export biaslinked totheappreciation ofthe
CFA franc. Acomplex import regime resulted inhighprotection forsome industries atahighfiscal
cost.With other members oftheCentral Africa Customs andEconomic Union, Cameroon reformed
itscommon external tariffinJanuary 1994andintroduced inJuneanewGeneral Trade Schedule which
seeks toconsolidate thecountry 'simport liberalization measures. Thereforms include measures to
streamline export procedures andreduce export duties totakeadvantage oftheCFA devaluation.
According tothereport, tariff escalation inthenewSchedule issubstantial inareas suchastextiles
andclothing andbasic metal products.
95-0289 MORE PRESS/TPRB/2
Page2/3
Cameroon hasmade littleuseofmultilateral commitments toreassure investors andother
economic agents ofthepermanence ofitsnewoutward economic orientation. Cameroon hadnotariff
bindings inthepre-Uruguay Round GATT andimplementation oftheUruguay Round results willlead
toonlyahandful ofnewtariffbindings forindustrial products. Allagricultural products arenowbound
buttheceiling rates"aremany times higher thanthecurrently applied tariffs." Thereport says"the
lowlevelofmultilateral commitments isofparticular concern because thereappear tobefewinstitutional
constraints toprevent protectionist measures creeping backintoCameroon 'strading system."
Exports, however, arenowlargely uncontrolled andauthorizations havebeenremoved with
onlyselected products subject tocontrols. Inaddition, freezonelegislation hasbeenintroduced to
promote export-oriented investment. Although statemonopolies stillinclude public services, petroleum,
telecommunications andinternational shipping, thehighlevelofstateinvolvement inother sectors has
beenprogressively reduced.
TheUruguay Round market access andservices commitments should complement Cameroon 's
reforms. Asthecountry 'sreforms takeroot, exporting firms should findimport barriers falling and
export opportunities expanding. However, "attracting substantial newinvestment, particularly foreign,
isaprecondition toexploiting fullythose newopportunities," saysthereport.
Notes toEditors
1. TheWTO Secretariat 'sreport, together withareport prepared bytheGovernment ofCameroon
willbediscussed bytheWTO Trade Policy Review Body (TPRB) on13and14February 1995. The
review ofCameroon iscarried overfrom the1994 programme oftrade policy reviews. Thereview
willbeajointmeeting oftheTPRB andtheGATT 1947Council. Thisisthefirstreview ofCameroon
since thelaunching ofthetrade policy reviews inDecember 1989.
2. TheWTO Trade Policy Review Body conducts acollective evaluation ofthefullrange oftrade
policies andpractices ofeachWTO member atregular periodic intervals andmonitors significant trends
anddevelopments which mayhaveanimpact ontheglobal trading system.
3. Thetworeports, together witharecord oftheCouncil 'sdiscussion andoftheChairman 's
summing up,willbepublished induecourse asthecomplete trade policy review ofCameroon and
willbeavailable from theWTO Secretariat, Centre William, Rappard, 154ruedeLausanne, 1211
Geneva 21.
4. Thereports cover development inallaspects ofCameroon 'stradepolicies, including domestic
lawsandregulations, theinstitutional framework, trade-related developments inthemonetary and
financial sphere, trade practices bymeasure andtrade policies bysector. Attached arethesummary
observations fromtheSecretariat 'sreport. Fullreports willbeavailable forjournalists fromtheWTO
Secretariat onrequest.
5. Since December 1989, thefollowing reports havebeencompleted: Argentina (1992), Australia
(1989 &1994), Austria (1992), Bangladesh (1992), Bolivia (1993), Brazil (1992), Canada (1990, 1992
&1994), Chile (1991), Colombia (1990), Egypt (1992), theEuropean Communities (1991 &1993),
Finland (1992), Ghana (1992), Hong Kong (1990 &1994), Hungary (1991), Iceland (1994), India
(1993), Indonesia (1991 and1994), Japan (1990 &1992), Kenya (1993), Korea, Rep.of(1992), Macau
(1994),Malaysia(1993),Mexico(1993),Morocco(1989),NewZealand(1990),Nigeria(1991),Norway
(1991), Peru(1994), thePhilippines (1993), Poland (1993), Romania (1992), Senegal (1994), Singapore
(1992), South Africa (1993), Sweden (1990 &1994), Switzerland (1991), Thailand (1991), Tunisia
(1994), Turkey (1994), theUnited States (1989, 1992&1994), Uruguay (1992) andZimbabwe (1994).
MOREPRESS/TPRB/2
Page4
TRADE POLICY REVIEW BODY
CAMEROON
Report bytheSecretariat -Summary Observations
After decades ofimport-substitution policies, Cameroon began opening itsinternational trade
system inthelate1980s, aprocess which included theintroduction ofnewcustoms andfiscal régimes
inJanuary 1994. Asaresult, quantitative restrictions, tariffexemptions andspecial customs andfiscal
régimes havenowbeeneliminated ordrastically reduced. With some important exceptions, exports
arelargely uncontrolled andmostexport charges arelow.Cameroon 'simport tariffs arealladvalorem
andapplied infourtiers, withanaverage of18.8percent. Anewturnover taxhasbeenintroduced
andprogress continues inareas related tocompetition policy, government procurement, technical
requirements andanti-dumping.
Cameroon 'stradeliberalization andfiscal reform arepartofalarger market-oriented economic
reform programme aimed atreversing aprolonged economic downslide triggered bythehalving of
world petroleum prices in1986. Theensuing sharp fallsinexport revenue andgovernment income
required increasingly stringent internal measures tokeeptheoverall budget deficit under control. As
these measures failed torestore growth, Cameroon inconcert withtheother countries ofthefranc
zonesought torestore competitiveness bydevaluing theCFAfranc fromCFAF 50toCFAF 100per
French franc inJanuary 1994. Thesuccess ofthedevaluation inachieving asustained higher level
ofexports, andthushelping tounderpin stable growth, hinges inpartoncontaining inflation soas
topreserve thecostadvantages derived fromthedevaluation. Although there weresigns inlate1994
thatthestrategymightbeworking,Cameroon'sprocessofeconomicreformisstillfragileandinadequate
investment levels remain aserious constraint toasustained economic recovery.
Cameroon hasmade littleuseofmultilateral commitments toreassure investors andother
economic agents ofthepermanence ofitsnewoutward economic orientation. Cameroon hadnotariff
bindings inthepre-Uruguay Round GATT. Implementation oftheUruguay Round results willlead
toonlyahandful ofnewtariff bindings forindustrial products. Although Cameroon hasbound all
itsagricultural tariffs under theUruguay Round Agreement, theceiling ratesintroduced, 80percent
withamaximum levelfor"other duties andcharges" of230percent,aremany times higher thanthe
currently applied tariffs. Thelowlevelofmultilateral commitments isofparticular concern because
there appear tobefewinstitutional constraints toprevent protectionist measures creeping backinto
Cameroon 'strading system. Deeper multilateral commitments would confirm theauthorities 'stated
determination nottoback-track ontrade reform.
Cameroon inWorld Trade
Cameroon 'sservice sector accounts foralmost halfofGDP; theagriculture andmanufacturing
sectors arealsolarge, eachaccounting forabout 22percentofGDP. Agriculture isparticularly
important asitemploys about 80percentofCameroon 'spopulation; manufacturing isresponsible
foralarge share oftotalformal employment. Manufacturing ismostly based ontheprocessing of
indigenous agricultural products, although processing ofimported materials alsotakes place. Among
thelargest manufacturing industry groups arefoodandbeverage products, textiles, andaluminium.
Theinformal sector issizable andgrowing.
Cameroon 'slargest trading partner istheEuropean Union (EU), which accounts forsome 75
to80percentoftrade ineachdirection. About 30percentofCameroon 'sexports aretoFrance;
MOREPRESS/TPRB/2
Page5
Italy, theNetherlands, Spain and,toalesser extent, Germany were Cameroon 'sother main export
markets. Outside theEU,theUnited States isthelargest market forCameroon 'sexports butits
importance hasfallen markedly since theearly 1980s. Theshare ofAfrica inCameroon 'sexports
isestimated atbetween 5and10percent, thelargest markets apparently being theCentral Africa
Republic, Congo, Gabon, Morocco andNigeria. Byfartheleading supplier toCameroon isFrance,
withashare ofabout 45percent; other major European suppliers include Belgium, Germany, Italy,
theNetherlands andSpain. Cameroon 'slargest non-European suppliers aretheUnited States andJapan;
although notwelldocumented, imports from Nigeria andCameroon 'sother neighbours alsoappear
important.
Crude petroleum accounts forabout halfofCameroon 'stotalexports, down fromtwo-thirds
in1985. Non-petroleum exports arespread overarelatively broad range ofagricultural products,
themost important being bananas, cocoa, coffee, cotton, natural rubber andwood logs. Themajor
processed export product isaluminium. Cameroon 'simports aredominated bymanufactured goods,
which account forsome three-fourths ofallimports. Themain imported products arechemicals
(including medicines), alumina andautomotive products, butabroad assortment ofother products is
alsoimported. Food imports account forslightly under 20percentoftotalimports, mainly frozen
fish,flour andrice. Crude petroleum imports forthelocalrefinery arealsosignificant.
Trade Policy Framework
Cameroon isabilingual, unitary state. ThePresident isHead ofState withexecutive
responsibility fortheconduct oftheRepublic 'saffairs andthenegotiation andratification oftreaties.
ThePresident appoints thePrime Minister andtheministers andsecretaries ofstateandpresides the
Council ofMinisters. Ministries involved intheformulation andadministration oftradeortrade-related
policiesincludethoseofIndustrialandCommercialDevelopment,Finance,ForeignAffairs,Agriculture,
andTown Planning andHousing. Cameroon 'slegislature, theNational Assembly, isaunicameral
body of180elected members serving five-year terms.
Cameroon doesnothaveaforeign trade law. International treaties andlawsaresubject to
approval bytheNational Assembly. International accords ratified byCameroon, including GATT,
areineffect fromthetimetheyareratified, withnoimplementing textsrequired, andtakeprecedence
overinternal lawsexcept theConstitution. Responsibility fornegotiating, concluding andsigning trade-
related treaties andagreements isvested intheMinistry ofIndustrial andCommercial Development
andtheMinistry ofForeign Affairs.
Cameroon isamember oftheCentral Africa Customs andEconomic Union (CACEU), whose
othermembersaretheCentralAfricanRepublic,Chad,Congo,Gabonand,non-GATTparty,Equatorial
Guinea. TheCACEU Treaty provides foracommon external tariff asthemaininstrument forextra-
regional tradepolicy andforapreferential dutytopromote intra-regional trade. Exchange ratestability
andtheharmonization ofmonetary policies between CACEU members isensured through their
participation intheBankofCentral African States (BEAC). TheConvention ofMonetary Cooperation
between BEAC-member countries andFrance provided forafixed exchange ratebetween theCFA
franc andtheFrench franc.
GATT rulesandobligations canbeinvoked inrelevant matters before Cameroon 'scourts and
GATT obligations aretaken fullyintoaccount intheelaboration oftrade-related domestic legislation.
After independence in1960, Cameroon applied theGATT defactountilitbecame acontracting party
on3May1963, withrights andobligations applying retroactively to1January 1960. Cameroon has
observer status intheTokyo Round Agreements onGovernment Procurement, Customs Valuation and
Civil Aircraft, buthasnotacceded toanyoftheTokyo Round Agreements andArrangements.
MOREPRESS/TPRB/2
Page6
Cameroon 'smain objectives during theUruguay Round were toimprove market access for
itsexports andtoenhance thesecurity ofthataccess. Cameroon participated throughout theUruguay
Round, taking acoordinated approach withitsfellow members oftheCACEU inseveral areas, including
agricultural andnatural resource-based products, tariffescalation inimporting countries andimproved
market access opportunities. Theauthorities weresatisfied thatCameroon 'sobjectives fortheRound
hadbeenattained, although concerns linger inrelation tosubsidized agricultural exports andtheerosion
ofthepreference margins enjoyed byCameroon under theLomé Convention.
Theauthorities believe thatnomajor regulatory changes arerequired toimplement theRound 's
results, particularly given Cameroon 'srecent liberalization ofitstrade régime. Asof20December
1994, theNational Assembly hadbegun, butnotyetcompleted, itsapproval ofCameroon 'sratification
oftheWorld Trade Organization.
Cameroon isgranted tradepreferences inaccordance withexisting GSPschemes bydeveloped
countries andenjoys preferential access totheEuropean Union 'smarket under theLomé Convention.
Cameroon isacontracting party totheGlobal System ofTrade Preferences (GSTP) among developing
countries andwithin thissystem ithasanagreement withRomania. Tariffs areapplied onanm.f.n.
basis, theonlysignificant exception being trade withother members oftheCACEU. Cameroon is
party toseveral commodity agreements established within theUnited Nations Conference forTrade
andDevelopment, including thecocoa, coffee, natural rubber andtropical timber agreements.
Trade Policy Features andTrends
Recent evolution
Before 1994, Cameroon 'stariff yielded relatively lowrevenue because ofthewidespread use
ofexemptions, made necessary tooffset, inpart,thestrong anti-export biasinherent intherealeffective
appreciation oftheCFA franc after1985. Theendresult wasanextremely complex import régime
which tended toprovide industries with"tailor-made" protection, tothedetriment oftheefficient use
ofresources andatahighcosttotaxpayers. Italsolentitself tofraud andabuse. Toaddress these
problems, Cameroon embarked onatrade liberalization programme in1990, including acoordinated
planwiththeother CACEU members toreform theircommon external tariffwhich ledtotheadoption
ofnewtariff andfiscal régimes inJanuary 1994.
AnewGeneral Trade Schedule wasintroduced inJune1994, laying down Cameroon 'strade
policy aftertherevamping ofthetariff andfiscal régimes andtheCFA franc devaluation. Thenew
Schedule seeks toconsolidate Cameroon 'simport liberalization measures andprovide alegalframework
tofightillicit tradepractices andunfair competition, andtocontinue theprocess ofstreamlining export
procedures andreducing export duties totakeadvantage oftheCFA franc devaluation andstructural
reforms torelaunch economic activity byrecapturing export markets anddiversifying exports.
Type andincidence oftrade policy instruments
ThenewCACEU 'stariff has5,531 linesatthe8digitHSlevel, applied atratesofeither 5,
10,20or30percent. Cameroon accords atleastm.f.n. treatment toimports from allcountries.
Tariff escalation issubstantial inareas suchastextiles andapparel andbasic metal products; incertain
sectors, thepattern ofescalation isunusual inthattheaverage rateonsemi-manufactured goods is
significantly lower thanonrawmaterials.
Outside theframework oftheCACEU tariff, Cameroon levies acustoms dutyof15percent
onimports ofpetrol (super) anddiesel. Other special customs andfiscal régimes, notably thoseaccorded
MOREPRESS/TPRB/2
Page7
topublic andpara-public enterprises, havebeeneliminated orshould bephased outinthenearfuture.
Tariff exemptions havebeendramatically reduced andnoquantitative restrictions areinforce; most
imports arenowsubject onlytoadeclaration forstatistical purposes withonlycertain products subject
totechnicalendorsements.Cameroonmaintainsanimportpre-shipmentverificationprogramme;exports
fromsome 90countries aresubject tosuchprogramme, including allthose from Cameroon 'smajor
trading partners.
Exports arelargely uncontrolled. Export authorizations havebeenremoved withonlyselected
products subject toquality andhealth controls. There arenosubsidies to,orquotas onexports although
palmoilexports havebeenrecently banned andCameroon 'sparticipation ininternational commodity
agreements doescarrycertain restrictions. Cameroon alsoimposes potentially distorting export charges
onitsmainagricultural export products: a(tax-deductible) charge of15percentonexports ofcocoa,
coffee, banana, cotton andmedicinal plants andanexitdutyof25percentonwood logs. Moreover,
asageneral rule,onlyupto30percentoflogsmaybeexported without prior localtransformation;
from1999, exports oflogsaretobeprohibited. Freezonelegislation hasbeenintroduced topromote
export-oriented investment.
Thepreviously extensive system ofprice controls andguaranteed producer prices havebeen
largely dismantled. Thehighlevelofstateinvolvement intheeconomy hasbeenprogressively reduced,
although statemonopolies stillinclude public services, petroleum, telecommunications andinternational
shipping. Progress continues towards establishing acomprehensive legal framework intheareaof
standards andothertechnical requirements, which currently havethepotential tobeusedasprotectionist
tools. Under current government procurement legislation, there isadegree ofpreference forlocal
materials; nopreferential treatment isgiven tobidders onthebasis ofcountry oforigin, although
credit availability appears tolimitbidstocertain regions. Newgovernment procurement legislation
isscheduled tobeintroduced in1994.
Temporary measures
Cameroon hasnoanti-dumping orcountervailing procedures along GATT lines, although
referencestodumpingpracticesaremadeinlegislationconcerninganti-competitivecommercialpractices.
Cameroon hasnodomestic procedures forsafeguard action norhavethere beenrequests forimport
relief under suchprocedures. Complaints bydomestic producers forrelief against offending imports
appear tobehandled informally andthrough indirect measures. Forexample, Cameroon 'sfinallist
ofm.f.n. exemptions intheUruguay Round services agreement indicates thatmeasures concerning
sharing agreements onshipping routes would bestrengthened iftrading partners continued topractice
dumping. Theauthorities areoftheviewthatCameroon 'srecent trade andprice liberalization have
made itnecessary toconsider newmeasures tofightanti-competitive practices, including dumping,
toprotect consumers. Asaresult, measures havebeenintroduced orarebeing studied affecting,
interalia,advertising, accounting practices, quality control andafter-sales service.
Sectoral policy patterns
Prior to1985, Cameroon sawimport-substitution asanimportant element ofthedevelopment
process. Following thestartofoilproduction in1977, growing revenue frompetroleum exports helped
finance bothagricultural support programmes andambitious industrialization plans inanattempt to
achieve self-sufficiency inbothfoodandarange ofbasic manufactures. Domestic production was
largely insulated from foreign competition byhightariffs andvarious restrictive barriers totrade.
Industries werefostered whose survival depended oncontinuous government assistance andprotection.
Publicandparastatalenterprisescametodominateabroadrangeofprimaryandmanufacturingindustries.
MOREPRESS/TPRB/2
Page8
Since 1986, lower export revenue andgovernment income haveprompted aseries ofsectoral
reforms. Inthepetroleum industry, arange ofamendments tothehydrocarbons codewereintroduced
in1990toencourage exploration andtheindustry islikely tocontinue playing akeyrôleinCameroon 's
economy foryears tocome. Intheagricultural sector, drastic changes affecting producer prices,
marketing systems andadministrative bodies produced ashock fromwhich thesector isyettorecover
fully. Nevertheless, thereorientation ofagriculture toward themarket andthepotentially
competitiveness-boosting effects oftheCFAfranc devaluation should haveplaced Cameroon inagood
positiontoexploittheopportunitiesthatmayresultfromtheUruguayRound.Cameroon'smanufacturing
sector remains thelargest andmost diverse intheregion, withparticular strengths indownstream,
agro-based industries. However, thesector wasseverely affected bythecontraction ofthedomestic
economyandthelossofcompetitivenessinforeignmarkets.Theresultingprocessofde-industrialization
hasnotbeenhalted bylimited programmes ofprivatisation, rehabilitation orliquidation ofpublic and
para-public enterprises.
Cameroon 'snewindustrial policies havethepotential toleadagain toadistorted production
structure. Thisisparticularly trueofthecurrent thrust toincrease value added onanindustry byindustry
basis andofthesector specific investment régimes nowemerging. These strategies maysucceed in
boosting thetargeted activities, butattheexpense oflower value added inother industries. More
importantly, thepiecemeal pursuit ofinvestment andofhigher value added risks creating ventures
withuncertain long-term prospects while preventing theeconomy fromattaining, given itswealth of
natural resources, itshighrealincome potential.
Trade Policies andTrading Partners
Cameroon 'scomprehensive macroeconomic andstructural reform programme havegone a
longwaytowards reversing thecountry 'sprevious inward-looking, anti-export policies. Thisreform
programme, although coordinated withtheother CACEU members, wasundertaken autonomously.
Nonetheless, measures byother countries inthemultilateral context oftheUruguay Round should be
astrong complement tothese reforms. AsCameroon 'sreforms takeroot,exporting firms should find
import barriers falling andexport opportunities expanding. However, attracting substantial new
investment, particularly foreign, isaprecondition toexploiting fullythose newopportunities.
MOREPRESS/TPRB/2
Page9
TRADE POLICY REVIEW BODY
CAMEROON
Report bytheGovernment -Summary Observations
After 1960, thedateofindependence, Cameroon regularly enjoyed sustained economic growth,
reaching arecord levelof6.5percentin1986 duetothegood performance oftheprices ofprimary
commodities ontheworld market, asagriculture accounts foralargeproportion ofitseconomic activity.
Thecollapse ofworld prices in1987together withthefalloftheAmerican dollar greatly affected
theeconomies ofdeveloping countries generally, andofCameroon inparticular, andledtomounting
budget deficits.
Thechronicbudgetdeficitsandliquidityproblemsgaverisetotheestablishmentofastabilization
planforpublic finances andthenegotiation withtheBretton Woods Institution ofafirstStructural
Adjustment Programme (SAP) in1988.
Implementation ofTrade Policy
Anordinanceof5January1995imposedalevy(Royalties)onexportsofcocoa,coffee,bananas,
cotton, sugar, palm oil,rubber andmedicinal plants.
Theratesapplied tothese products areasfollows: 15percentofthef.o.b. value forcocoa,
cotton, sugar, rubber andmedicinal plants; 25percentofthef.o.b. value forcoffee; 30percentof
thef.o.b. value forpalm oiland6,500 CFAF pertonne forbananas.
Inparallel, aninspection andcontrol taxonexports ofprimary commodities wasestablished.
Itisapplied tococoa, coffee, medicinal plants, timber, palm oilandbananas.The rateofthistaxis
0.95percentofthef.o.b. value ofexported products.
These measures stemfromtheGovernment 'sconcern tostabilize theeconomy byguaranteeing
supplies ofrawmaterials tolocalfactories. However, astheyarenotsubsidized, exports ofsemi-finished
andfinished products arenotsubject toanycustoms dutyorcharge. Inorder topermit thedevelopment
oftrade flows within theCentral African sub-region, aprogramme ofcreating frontier markets has
beenlaunched withaview tothecreation offivefrontier markets. Only one,onthefrontier with
theGabon Republic, issofarinoperation. Onthefinancing side,ithasjustbeendecided thatthecost
ofborrowing andaccess tocredit willbesignificantly eased.
Imports
Thegeneral trade programme represents theculmination oftheliberalization process which
hasbeenunderway since1989. Itskeyobjective istorestore competitiveness, anditcontains significant
import liberalization measures, mainly thetotalelimination ofquantitative restrictions andtheabolition
ofimport licences. Meanwhile, particular emphasis hasbeenplaced onmeeting quality standards both
forlocalandimported products. Unfortunately, standardization inCameroon isstillembryonic and
unregulated sothattheapplication ofstandards andthecertification ofproducts present practical
difficulties. Intheabsence ofanappropriate body responsible forcertifying thatproducts conform
tonational standards andforgranting therighttousethenational emblem, certification isalmost non-
existent.
MOREPRESS/TPRB/2
Page10
Nevertheless, measures havebeentaken tointroduce suchasystem. Inthemeanwhile, no
reference ismade tostandards except incases where aproduct issuspected ofbeing orisdeclared
dangerous. Then theauthorities concerned takethenecessary measures tocontrol itsimport andsale
within thecountry. Cameroon doesnotusestandards asaprotectionist measure forimported products,
since itchose toliberalize itseconomy tomake itmore competitive andincrease itsexports. Itshould
besaidthatthere isnointernal procedure concerning safeguards, given thatthere hasnotbeenany
request forprotection against imports under these procedures.
TheGovernment hasnever taken selective measures targeting aproduct from anycountry.
Likewise, there havebeennorequests bytheCameroon Government forprotection against imports
intheframework ofabilateral orregional agreement.
Investment policies
Byencouraging export-oriented industrial enterprises inparticular, thesepolicies areundeniably
afactor intrade promotion. With theintroduction ofthefiscal andcustoms reform intheCACEU,
customs concessions which hadpreviously beengranted toenterprises enjoying privileges under the
Investment Code, except those intheIndustrial-Free Zone, wereabolished. Nevertheless, industrial
plant andrawmaterials aresubject toareduced customs dutyoftenpercent. Equipment isexempt
from turnover tax,while there aredeductions forrawmaterials.
Concessions related totheinstallation phase include exemption from: registration duties; capital
transfer duties; taxonallocation ofcredits; theminium flat-rate tax;thespecial companies tax;the
special registration taxandareduction of50percentofthecompanies taxfrom thefirstyearwhen
itispayable.
Concessions related totheproduction phase include exemption from theminimum flat-rate
taxandthespecial companies tax,50percentofcompanies tax,50percentoftheproportional tax
onincome frominvestments andthecarrying forward ofthelossresulting fromdepreciation charges
normally written offduring thefirstthreeaccounting periods forthefollowing fiveaccounting periods.
Inaddition totheabove-mentioned concessions, theinvestment codecontains other incentives:
- National treatment forforeigners, subject tocompliance withlegal andregulatory
provisions, aswellaswithtreaties andagreements concluded byCameroon withthe
States ofwhich theyarenationals;
- therighttotransfer revenue ofanykindarising fromcapital invested and,oncessation
ofactivities, theproceedings ofliquidation ortransfer oftheinvestment, subject to
theenterprise having settled itsliabilities withthetaxauthorities;
- freedom tohireanddismiss staffincompliance withcurrent social andemployment
legislation;
- forpartners ofenterprises regularly established inCameroon freedom ofmovement
oftheirstaffholding adulycertified contract ofemployment, andtheirlegalfamilies.
Asingle window system isinoperation, toprovide investors withalltheservices which
theyrequire from theAdministration.
MOREPRESS/TPRB/2
Page11
Industrial-free zoneregime
Thisisreserved foressentially export-oriented enterprises which areexempt from alldirect
andindirect taxes, except fortaxonindustrial andtrading profits towhich theyareliable from the
eleventh yearofoperation atareduced rateof15percent.
A"single window" hasbeenopened forthiscategory ofenterprises toprovide them withall
theservices theyrequire from theadministration.
Customs measures
Forcustoms matters, Cameroon applies theCACEU tariff which isbased onthefiscal and
customs reform adopted bytheCACEU. There arethusfourcategories ofimport products. The
following tableliststhecustoms duties applicable tothese various categories:
Category Description Common trade tariff
after devaluation
I Products ofbasic necessity 5%
II Rawmaterials andcapital goods 10%
III Intermediary goods andmiscellaneous 20%
IV Ordinary consumer goods 30%
Apart from thecommon trade tariff, other internal taxes areapplied toimports:
Generalized preferential tariff 0%;
turnover tax 5.5% and16.5%;
excise duty 25%.
Ageneralized preferential tariff isapplied tointer-regional trade (CACEU).
International macro-economic situation affecting theexternal sector
Devaluation oftheCFA franc
Themonetary adjustment decided on12January 1994 gaveriseto:
- Anincrease inthepriceoflocally manufactured products, because ofthelargecontent
ofimported inputs whose costrosedespite afallinvolume;
- stagnation ofagricultural exports owing totheshiftoflabour toother sectors asaresult
ofthefallinworld prices, thesubsequent fallinproduction andthelowpriceelasticity
inrelation todemand;
- anevenlower leveloffoodexports, despite improvements inproduction: substitution
ofimports duetoimported inflation ledtoafurther reduction oftheproportion destined
forexport.
Although thedevaluation oftheCFAfranc hadadverse effects intheveryshortterm(inflation,
fallinincomes, hardship) itspositive impact onthenational economy willbemeasured inthemedium
MOREPRESS/TPRB/2
Page12
term byimproved competitiveness andtherevival ofexports, andinthelongterm byindustrial
expansion.
Problems faced ontheexternal market
There arethreetypes ofproblems relating tothelackofcompetitiveness ofourexport products
ontheexternal market: thefirstispoorpackaging, highproduction costs andirregularity ofsupply.
Thesecond concerns thesudden opening upofthemarket, alogical consequence ofmembership
ofregional orsub-regional groups, theentry intoforce oftheWTO andtheliberalization measures
prescribed inthecontext ofstructural adjustment programmes, including tariffandnon-tariff barriers,
notably those related torules oforigin andstandards forpackaging, quality andsizes.
Thethirdrelates tothemuch more demanding rules introduced bytheEuropean Union, our
primary partner. Therulescould haveamore negative impact thancustoms duties andother non-tariff
measures onCameroon exports. TheCameroon Government intends tointroduce asamatter ofpriority
astandardization bodyresponsible fordeveloping andimplementing apolicy which complies withthe
relevant international rules.
END