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CAMEROON I.

PROFILE

Location

Official Name Area Population Capital Major cities Language Currency Climate

Main holidays Weekly day off Local time Working hours Principle Growth Sectors

On the Gulf of Guinea and forms part of the West Central African Region. It is bordering on the north by Lake Chad, on the east by Chad and the Central African Republic, on the south by the Congo, Gabon and Equatorial Guinea, and on the west by Atlantic Ocean, and Nigeria. Republic of Cameroon 475,442 sq km 15.46 million inhabitants in 1999 Yaounde Douala, Garoua, Nkongsamba and the port of Limbe French and English are the official languages CFA-Franc. 1$US = 652.95 CFA F Cameroon has a tropical climate, humid in the south but increasingly dry on the north. On the coast the average annual rainfall isabout 4060mm. On the exposed slopes of the Cameroon Mountains in the west, rainfall is almost constant and sometimes reaches 10,160 mm a year. In semiarid northwest annual rainfall averages about 380 mm. A dry season in the north lasts from October to April, the average temperature in the south is 25° C, on the plateau it is 21°C and in the north it is 32°C. January 1st, February 11th, Good Friday*, Easter Monday*, Mai 1st and 20th, Ascension*, December 10th and 25th. Saturday-Sunday

GMT + 1. Administration and Enterprises : From 7 H 30 to 12 H 00 and 14 H 30 to 18 H 00. Banks : From 7 H 30 to 11 H 00 and 14 H 30 to 16 H 30. Agriculture, Textiles and Oil industry

(*) Variable dates

II. ECONOMIC SECTORS II.1 AGRICULTURE Agricultural activities are the main occupation of about 60 percent of the population of Cameroon. The agriculture products are coffee, cocoa, cotton, rubber, bananas, oilseed, grains, root starches; livestock; timber The principal commercial crops in Cameroon are cacao, coffee, tobacco, cotton, and bananas. In the early 1990s yearly production of cacao and coffee, the leading agricultural export commodities, was about 94,000 metric tons for the former and 85,000 tons for the latter. Other commercial products include rubber, palm products, and sugarcane. Subsistence crops include plantains, sweet potatoes, cassava, corn, and millet. Livestock rising is important in the Adamawa Plateau region.

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II.2 FORESTRY AND FISHING Timber is traditionally one of Cameroon's most valuable exports, consisting mainly of mahogany, ebony, and teak. The annual timber cut in the early 1990s amounted to some 14.6 million cu m (515 million cu ft). Fishing is dominated by freshwater subsistence activity. However, deep-sea fishing activity is increasing, especially from the port of Douala. About 78,000 metric tons of fish are caught annually. II.3 MINING AND MANUFACTURING One of the largest single industrial enterprises in Cameroon is the aluminum smelting plant at Edéa, which produces about 92,000 metric tons annually from imported bauxite. The processing of agricultural products, however, dominates industrial activity; other manufactures include textiles, fertilizers, and cement. Offshore petroleum exploitation began in the late 1970s, and an oil refinery has been built on the coast at Limboh Point. Cameroon's output of crude petroleum, mostly for export, reached 61 million barrels a year during the early 1990s. Small amounts of gold and tin concentrates are also produced.

III. INFRASTRUCTURES III.1 ROAD NETWORK Cameroon has approximately 70,050 km (approximately 43,530 mi) of roads; about 11 percent are paved. Cameroon's main industrial and commercial port city, Douala, is linked to major Southern cities by good roads. III.2 RAIL NETWORK The country has 1104 km (about 686 mi) of railroad. Douala is linked to Yaounde, the second major city, by rail transportation. Distribution to northern provinces is mainly by train to Ngaoundere where regional warehouses stock goods for onward road delivery to other northern cities and Chad. The railway line also links Douala to the East province, which serves as a transit point for goods bound for the Central African Republic. III.3 AIR TRANSPORT Cameroon is served by three international airports at Douala, Yaounde and Garoua, which have facilities for airfreight. There are over 50 small airports and airstrips, of which only 9 have permanent surface runways. As a result of the economic crisis, only three of the smaller airports are in service. Cameroon Airlines provides domestic and international service. There are a number of international airlines, which fly to Cameroon. The big international airport is at Douala and there are regular connections to Yaounde. 2

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III.4 MARITIME TRANSPORT The overwhelming majority of port traffic is handled at Douala. Kribi is the country's second port. The port of Garoua on the Benue River in the north is open two to three months a year and handles most of the trade with Nigeria. III.5 TELECOMMUNICATIONS Utility and telephone services are good in the two largest cities, Yaounde and Douala, but are becoming increasingly unreliable because of poor maintenance. The national radio and television broadcasting system has its headquarters at Yaoundé and local radio stations in Douala, Garoua, and Buea.

IV. FOREIGN TRADE REGULATIONS IV.3. THE LEGAL FRAMEWORK OF TRADE RELATIONS: • Cameroon belongs notably to the following organisations : ∗ The World Trade Organisation (W.T.O) ; ∗ The United Nations Organisation (UN) and its other main specialized institutions (World Bank, IMF, etc…) ; ∗ The Organisation of the Islamic Conference (OIC) ; ∗ Central Africa Customs and Economic Union (UDEAC) , ∗ The African Unity Organisation (AUO) ; ∗ The Central Africa rates Banks ; ∗ And Central Africa Development Bank ; • A multitude of economic co-operation agreements and trade conventions were signed between Cameroon and several African, European, Asian and American countries. IV.2. TRADE STRUCTURE: IV.2.1. Main exported products : ∗ Crude petroleum ; ∗ Coffee ; ∗ Timber ; ∗ Bananas ; ∗ Cotton ; ∗ Cocoa ; ∗ and natural rubber. IV.2.2. Main imported products : •

Imports are mainly composed of : 3

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∗ Capital goods ; ∗ Semi-finished products and raw materials secured for the needs of local enterprises ; ∗ And some food products such as rice and flour.

IV.2.3. Trading partners Main customers - Italy - Spain - France - Netherlands -China

Main suppliers - France -Nigeria -United States -Germany -Japan

IV.3. FOREIGN TRADE CONTROL : The implementation instrument of trade exchanges between Cameroon and the rest of the world is "le programme Général des Echanges" (Trade General Programme (decision n° 063/Mindic - CAB). IV.3.1. Imports regulations : At imports levels, Trade General Programme makes a distribution between four products categories : • Products subjected to simplified import declaration procedure ; • Products subjected to the prealable autorisation of the Ministry of Foreign Trade ; • Products subjected to the technical visa of some ministerial departments ; • And prohibited products. The control of imported goods is compulsory before shipment ; this control operation which is both quantitative and qualitative is carried out by "la Société Générale de Surveillance" (General Control Company). IV.3.2. Exports regulations : At export level, the trade General programme makes a distribution between three products categories : • Unrestricted products subjected to a simple customs declaration and possibly to a certificate of origin ; • Products requiring administrative formalities : the export of some products such as cattle, fisheries must be carried out taking into account the regulations provisions of countries of destination. Consequently, concerned exporters must first obtain certificates and attestations demanded by foreign buyers from competent national administrations ; • And finally products prohibited for exports : generally speaking these are products threatening health, security and environment. 4

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IV.3.3. Other formalities and documents : The following operations are exempted from shipping control modalities carried out by the SGS (General Control Company) : • Imports whose FOB value is lower than 2 million CFA Francs ; • Imports undertaken by public administrations on their own account ; • And some specific goods such as precious stones and objets d'art. IV.4. FINANCIAL REGULATIONS OF FOREIGN TRADE OPERATIONS : IV.4.1. Banking system : • Cameroon is member of Central Africa States Bank ; therefore it is not endowed with a Central Bank of its own ; • The banking system of Cameroon is also made up of commercial banks, some of which are rather branches of international banks such as "la Société Commerciale de Banque Crédit Lyonnais" - Cameroon or even "la Société Générale de Banque" in Cameroon. IV.4.2. Exchange system : • Cameroon is member of the Franc zone ;funds transfers between the Member States of this zone are not restricted by they must be carried out by authorized middlemen. • With regard to non-member countries, Cameroon applies the principle of partial convertibility ; in other words, currency convertibility is not restricted for current commercial transactions provided that the provisions of foreign trade regulations are respected by importers. IV.4.3. Methods and means for international settlement : • Cameroon's foreign trade operators resort to most of the settlement means and methods utilised at international level : documentary credit, international Bank transfers, documentary remittance etc… But, the most demanded means of settlement by foreign or cameroonese exporters remain irrevocable or confirmed documentary credit. • Certified cheque or bank cheque as well as backed bills are also utilised in international trade operations. IV.5. CUSTOMS TAXATION : In the area of customs taxation, Cameroon should take into account both its adhesion to the GATT and its participation in the customs and Economic Union of Central Africa. IV.5.1. Applicable duties and taxes : As UDEAC Member, Cameroon applies a commun external tariff provided for by 1/92 UDEAC Act. 5

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This external tariff applied by all Member States includes customs taxation and temporary surtax. At present, applicable customs duties rates are fixed on the basis of goods CIF value as follows : • • • • -

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Staples : 5% ; Raw materials and capital goods : 10% ; Intermediate goods : 20% ; And current consumption goods : 30%.

Temporary surtax was introduced to enable UDEAC Member States to abolish quantitative restrictions starting from 1996. But the rate must not exceed 30% and the maximal and non renewable implementation period of this temporary tax extends over six years. The taxable base is similar to that of customs duties. Cameroon also applies an import duty whose rate ranges between 5 and 90%. Imported goods are also submitted to a turnover tax (TOT) of 10% on the basis of CIF value plus customs duties and import duty amounts. Finally imported goods are subjected to other less important duties and taxes, such as inspection tax or computer tax. IV.5.2. Special provisions :

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UDEAC products covered by a corresponding certificate from a : • A total exemption from customs duties when they are included in the list provided by article 9 of the UDEAC Act n° 7/93 ; • Of a preferential tariff for other products ; this tariff is determined in percentage of the customs duty rate applicable to similar imported products of third countries. The constitute UDEAC Act provides for a progressive reduction of this preferential tariff with a view to reducing it to 0% starting from 1998. The taxable base of this preferential tariff is the price exworks.

V. FOREIGN INVESTMENT V.1 OPENNESS TO FOREIGN INVESTMENT The major law governing investments in Cameroon is the Investment Code, enacted in 1990. The Code seeks to attract mainly Greenfield investments. Under this code, investment incentives are identical for foreign and domestic investors. The Code creates an Investment Code Management Unit (ICMU), a "one- stop-shop" for investment approval and dispute resolution. The Code provides 14 key guarantees to investors, including property ownership, ability to repatriate capital and income, prior compensation in case of expropriation, freedom of movement within Cameroon, free exit for personnel, and protection from non-commercial risk as per the Multilateral Investment Guarantee Agency's Treaty with Cameroon. The Code also provides for dispute resolution. At the time of incorporation or application for investment code benefits, a firm may opt for one of the various procedures to settle future conflicts. General benefits of the Investment Code are available to all new and existing enterprises in Cameroon which process 6

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goods for export or use inputs from the local or regional (UDEAC) market. There are no other eligibility requirements to acquire the general benefits. In addition to these general benefits, firms may qualify for one of five special investment regimes, which offer more advantages. The five are: (1) the Basic Regime; (2) the Small and Medium-Size Enterprise Regime; (3) the Strategic Enterprise Regime; (4) the Reinvestment Regime and (5) the Free Zone Regime. The Code sets out in detail the specific criteria a firm must meet to qualify for the regimes as well as the benefits provided under each. The outstanding feature of the Code is the Industrial Free Zone Regime (IFZ), which it began operation in 1992. To qualify for IFZ status, a firm must produce goods or services that are 80 percent export-bound and which do not have deleterious effects on the environment. These are the only eligibility requirements for the IFZ regime. V.2 INCENTIVES OFFERED TO FOREIGN INVESTORS Qualifying IFZ firms receive a 10-year holiday on taxes and are subject only to a flat tax of 15 percent on corporate profits beginning in the eleventh year. They have a right to tax-free repatriation of all funds earned and invested in Cameroon, and are exempt from foreign exchange regulations. They are exempt also from existing and future customs duties and taxes and from all taxes related to locally purchased inputs to production. Cameroon's 1990 Investment Code establishes requirements for Cameroonian equity ownership for enterprises under the Small and Medium-Size Enterprise (SME) regime. For SME a Cameroonian company must hold companies at least 35 percent of the equity. Even in this case, foreign investors are not required to reduce their shares over time. There is no foreign exchange rationing, no requirement to locate at specific geographical areas, no requirements for technology transfer, and foreign investors may seek local financing for investment purposes. The Investment Code has general employment requirements per amount of invested capital. It also links benefits and incentives to the volume of exported goods and to the use of inputs purchased from the local or UDEAC (Central African Customs Union) markets. Each of the five special regimes of the Code has its own specific eligibility/performance requirements and accompanying benefits. Such benefits vary in duration from three to twelve years depending on the regime, and on whether the investment is classified "start-up" or "operational". Quantitative restrictions on imports and price controls have been abolished for most goods. (NEW) Le Cameroun est un lieu d’investissement attractif qui offre à l’investisseur potentiel les avantages suivants : ¾ Système politique libéral et démocratique ; ¾ Etat biculturel, avec deux langues officielles : le français et l’anglais ; ¾ Code des investissements qui offre d’importants avantages économiques et fiscaux ; ¾ Nombreuses ressources naturelles (pétrole, gaz, bauxite) et ptoduits agricoles divers (cacao, café, coton, banane, hévéa, etc) ; ¾ Régime de zone franche parmi les pls avantageux du monde, offrant aux investisseurs de nombreuses incitations ; ¾ Moyens de communications modernes (transports et télécommunications) ; ¾ Liens de coopération avec plusieurs organismes internationaux qui peuvent financer des projets d’investissements soit directement, soit indirectement par le biais de la Société nationale des investissements ; ¾ Main d’œuvre abondante et bon marché ; ¾ Monnaie dtable garantie par la France dans le cadre de la Zone Franc ; 7

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¾ Accès aux marchés de la Communauté Economique des Etats de l’Afrique Centrale et de la Communauté Economique et Monétaire des Etats de l’Afrique Centrale. 4.3. Investment opportunities (NEW) Des vantages spéciaux sont accordés à toute entreprise qui exerce des activités dans l’un des domaines suivants : ¾ Transformation de matières permeières pour la production de biens ou semi-finis ; ¾ Extraction et transformation de ressources minières ; ¾ Transformation des hydrocarbures ; ¾ Exploitation forestière et transformation du bois ; ¾ Production et transformation agricole et agro-industrie ; ¾ Industrie de la confection ; ¾ Elevage, pêche industrielle et artisanale ; ¾ Conservation des produits alimentaires ; ¾ Fabrication de matériaux de construction, et réalisation de projets de bâtiments et travaux publics ; ¾ Maintenance des équipements industriels axée sur la fabrication des pièces de rechange et les réparations navales ; ¾ Activités de recherche ; ¾ Hôpitaux et laboratoires d’analyse pharmaceutique ainsi que laboratoires d’essai, d’analyse et de contrôle des matières premières et des produits finis ou semi-finis ; ¾ Etablissements àvocation touristique (restauration , loisirs).

VI. CONVERSION AND TRANSFER POLICIES The CFA franc (F CFA), is the currency which Cameroon shares with thirteen other African member states of the franc zone. The Government of France guarantees the foreign exchange value of the F CFA. The French Treasury ensures the exchange of F CFA into French francs at the fixed parity rate. Since devaluation there has been no queuing for foreign exchange in Cameroon. The Bank of France no longer purchases CFA notes abroad. The authorization of the Ministry of Finance is required for foreign exchange business transfers. These authorizations are routinely granted if they are in conformity with the specified incentives of the investment and fiscal codes. Dividends, return of capital, interest and principal on foreign debt, lease payments, royalties and management fees, returns on liquidation etc, can all be remitted abroad.

VII. FINANCIAL AND BANKING SYSTEM Cameroon's banking system is controlled by the "Banque des Etats de l'Afrique Centrale" (BEAC), a common central bank serving five other member countries of the Central African (UDEAC) subregion. BEAC is monitored closely and regulated by the French Treasury. Like all other signatories to a 1948 agreement setting up the franc zone, Cameroon is obliged to hold at least 65 percent of its foreign reserves in an "operational account" (or "compte d'operation") that is supervised and managed in Paris, France, by the French Treasury. This account is the principal means by which France guarantees the exchange of the F CFA into French francs at a fixed exchange rate (1 F F = 100 F CFA). Lending and borrowing base rates are set by the BEAC, and 8

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banking institution are not allowed to lend below the floor rate, except by derogation of Parliament. Despite a system-wide restructuring exercise carried out in 1989- 1992, Cameroon's banking system has liabilities substantially in excess of any realistic valuation of its assets. The International Bank of Africa in Cameroon was liquidated in 1994. After the bankruptcy of its major stockholder, the Meridien BIAO Cameroon Bank was forced to limit deposit withdrawals and reduce operating hours during mid-1995. Nine commercial banks in Cameroon have been merged, liquidated or closed since 1989. In 1993, member states of BEAC created a supervisory authority over all banking and finance institutions in the "Union Douaniere et Economique de l'Afrique Centrale" (UDEAC) subregion and granted it extensive powers to discipline delinquent institutions. The authority, COBAC (Commission Bancaire de l'Afrique Centrale), has already withdrawn the license of Cameroon's only investment bank. Cameroon's banking system is currently made up of seven full- service commercial banks. Previously, these banks were obliged to hold non- interest-bearing government bonds equivalent to 10 percent of their assets. GRC arrears on these bonds have been consolidated at BEAC. Commercial banks are no longer required to purchase new government bonds.

VIII. INVESTMENT AGREEMENTS VIII.1 BILATERAL INVESTMENT AGREEMENTS Cameroon has bilateral investment and/or commercial agreements with the following countries: Austria, Belgium, Canada, China, Denmark, France, Germany, Greece, Italy, Japan, Russia, South Korea, Spain, Switzerland, the United Kingdom, and the United States. Similar bilateral agreements also exist with many other countries in Africa, Asia, Latin America, and Eastern Europe. The bilateral investment agreement between Cameroon and the United States was ratified and entered into force in 1989. VIII.2 MULTILATERAL INVESTMENT AGREEMENTS Cameroon has signed a number of accords with several contries in this field. Cameroon has sought closer ties with other nations, including the United States and Germany, and has signed economic and cultural cooperation agreements with many countries. It belongs to a number of multilateral organizations. The U. S. government signed an investment guarantee agreement with Cameroon in 1967. Overseas Private Investment Corporation has been receptive to American firms seeking war, expropriation and inconvertibility insurance in Cameroon.

IX. USEFUL ADDRESSES Organisations & Public ADDRESS Establishments Centre National du Commerce Immeuble ONCPB Extérieure (CNCE) 2461/7309 Douala Chambre du Commerce, Rue Pasteur B.P. 4011 d'Industrie et des Mines du Douala 9

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PHONE / FAX/TELEX/ E-MAIL B.P. Fax : (237) 226260 Telex : 5585 cnne Tel : (237) 426855/787 Fax:

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Camroun

Office National des Zones BP. 673 Douala Franches Industrielles Ministère du développement Direction du commerce industriel et commercial Yaoundé Syndicat des Commerçants 16, Rue Quilliens - B.P 562 Importateurs-Exportateurs du Douala Cameroun Ministère des Finances B.P. 18 Yaoundé

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(237) 425596 Telex : 5948 dechamdo kn E-mail : [email protected] www.g77tin.org/ccimhp.html Tel : (237) 433345/43 Tel : (237) 220070 Fax : (237) 222704 Telex : 8638 minci Kn E-mail: [email protected] Tel : (237) 426004 Tel : (237) 234000 Telex : 8260