Investors now find Cameroon as ‘the best risk’ to do business thanks to existing legal and administrative instruments.
Available information indicates that Cameroon’s economy is faring fairly well in its drive to attaining a middle-income economy status by 2035. According to documentation on the country’s economic performance from the Ministry of the Economy, Planning and Regional Development (MINEPAT), the skies are increasingly becoming brighter for Cameroon judging from her economic growth in the past five years.
In a document titled, “Focus on Cameroon’s Economy,” MINEPAT notes that, “National economy has increased at an average of 4.7 per cent during the last five years (2010-2014.)” But the growth falls below the projections of the long-term development plan contained in the Growth and Employment Strategy Paper whose target was to attain a 5.5 per cent average annual economic growth rate between 2010-2020.
“The government expects the upholding of the economic growth in 2015 with a rate of about 6 per cent and control inflation below 3 per cent despite the inflationist pressure strengthened by the revaluation of fuel prices in July 2014 and the increase of some food stuffs,” the document holds. However, analysts posit that for an economy to attain an emergent status, it must have sustained a double-digit growth rate for decades, every other thing being equal.
Cleansing The Business Climate
MINEPAT observes that much is being done to cleanse the hitherto unfriendly business climate so as to attract substantial and sustainable investors, especially direct foreign investments. The moves include among others the April 18, 2013 law on private investment incentives in Cameroon, the 2013 law governing economic zones in the country and the regular holding of the Cameroon Business Forum, a platform for public/private concertation on improving the business climate. The creation and rendering operational of the bank for small and medium-size enterprises and the launching in 2013 of Leasing, a mechanism to equip enterprises, are said to be good steps in the right direction.
The April 18, 2013 law on private investment incentives has been yielding palpable fruits already. Since the enactment of Law No. 2013/004 of 18 April 2013 that provides incentives for private investments, about 44 companies have already signed licenses with government, some of which have started production. These companies are pumping or will inject about FCFA 698 billion into the national economy to generate over 23,228 jobs.
The companies are offered diverse advantages during the installation and production phases (15 years) so as to get back their investments before government’s full fiscal policies are applied on them. For instance, during the installation phase, the businesses are exempted from registration duties in cases of creation or increase in capital; exemption from registration duties on leases of buildings for purely professional use and exemption from transfer taxes on the acquisition of buildings and land considered essential for the realisation of the investment programme.
Meanwhile, during the operational phase, investors have exemptions from or reductions on payments on some taxes, exemption from registration duties relating to credit facilities, loans, bonds, increments, reduction, reimbursement and liquidation of share capital, or any transfer of activities, among others. These and more rekindle hope that the economy could be better tomorrow than it was yesterday and today.