General overview
Cameroon is a country of the Gulf of Guinea on the west coast of Africa. Cameroon has an area of 475,442 km² . The country lies between the meridian edge of the Sahara and the northern edge of the rain forest in the Congo Basin of the south. The west of the country is dominated by the Highlands and includes the tallest mountain of entire West Africa: Mount Cameroon which rises at 4,100m and is the ninth highest peak in Africa. The East of the country is covered in the vast majority of well-preserved rain forest. It has 590 km of jagged coastline along the Atlantic Ocean. Cameroon has a very high extension on latitude 1,200 km from North to South and is schematically shaped as a triangle with its base along the second degree of the north latitude while the north border with Lake Chad reaches the 13th parallel.
The country is surrounded by the following countries and extensive water bodies:
- Nigeria and Atlantic ocean on the west side;
- Equatorial Guinea, Gabon and Democratic Republic of Congo on the south;
- Central African Republic and Chad on the east;
- Lake Chad on the North.
The 2018 population of Cameroom is estimated at 24.68 million. This makes Cameroon the 54th most populous country in the world. The urbanization rate is currently 3.3%; 58% of the country is urbanized and that percentage continues to grow annually.The proportion of children below the age of 15 is 42.39%, while 3.2% was 65 years or older.
Cameroon is Africa’s throbbing heart, a crazed, sultry mosaic of active volcanoes, white-sand beaches, thick rainforest and magnificent parched landscapes broken up by the bizarre rock formations of the Sahel. With both Francophone and Anglophone regions, not to mention some 250 local languages, the country is a vast ethnic and linguistic jigsaw, yet one that, in contrast to so many of its neighbours, enjoys a great deal of stability.
Economic Overview
Cameroon’s economic freedom score is 51.9, making its economy the 149th freest in the 2018 Index. Its overall score has increased by 0.1 point, with improvements in scores for fiscal health and government integrity offsetting declines in investment freedom and labor freedom. Cameroon is ranked 32nd among 47 countries in the Sub-Saharan Africa region, and its overall score is below the regional and world averages.
Economic performance and outlook
The outlook beyond remains positive, with growth projected at 4.1% in 2018 and 4.8% in 2019, spurred by higher exports to the European Union following an Economic Partnership Agreement (EPA) and increased energy supply due to new hydroelectric dams. Other tailwinds affecting growth include the development of forestry and agro-industrial value chains, as well as a reduction in imports in favor of local products.
Macroeconomic evolution
Cameroon has signed an economic and financial partnership agreement (the Extended Credit Facility) with the International Monetary Fund (IMF) that will stabilize the macroeconomic framework in the medium term by requiring a restrictive fiscal policy for 2017–19. Public investment is expected to drop from roughly 8% of GDP in 2016 to 6.7% in 2017 and 6.6% in 2019. Government revenues are projected to rise from 16.1% of GDP in 2016 to 17.7% in 2017 and 18.16% in 2019. The budget deficit dropped from 6.1% in 2016 to an estimated 3.6% in 2017 and is projected to remain below 3% in 2018–19. The debt ratio is below the CEMAC ceiling of 70% of GDP.
Tailwinds
The fiscal consolidation under the Extended Credit Facility with the IMF and the structural reform agreements with financial and technical partners, including the World Bank, will allow authorities to increase the effectiveness and efficiency of public investment through a better project maturity framework. Efforts will focus on collecting higher fiscal revenues to offset the decline in oil revenues and customs duties brought about by the EPA. By refining incentives policies and improving the business climate, the government seeks to diversify the economy and spur inclusive and job-generating growth. Membership in a monetary union helps Cameroon maintain low inflation rates. Cameroon is one of the most resilient economies in Africa. It is strategically located and blessed with excellent human capital and enormous natural resources.
Key sectors in Cameroon
Cameroon is primarily an agro-based economy. Almost 70% of the population is engaged in agriculture and allied activities.
- Mining: Cameroon has rich deposits of Bauxite; it however, lacks the essential infrastructure to leverage on this mineral reserve. The country also has limited reserves of gold and diamond. It produces 12,000 ct of diamonds and 20,000 oz of gold annually.
- Oil: As per 2008 figures, Cameroon produces approximately 82 thousand barrels per day, which is 0.1% of the world’s total production. The country has oil reserves of 400 million barrels along the Niger delta basin. As per UN figures, 30% of the total oil production get smuggled through Nigeria.
- Chemical: Pharmaceutical and chemical process industries are gradually emerging in the country. This sector has also attracted a major share of foreign investment.
Cameroon economy is fueled by other industry sectors as well, such as automotive, construction, food processing, engineering and real estate. However, these sectors have small contribution to the national GDP. To sustain long-term growth, Cameroon has to focus on strengthening non-mineral sectors.
Tourism in Cameroon
“All of Africa in a single Country”. This is a slogan of inspiration for all those who visit Cameroon and especially for expserts in Cameroon’s Ministry of Tourism.
This country offers all major characteristics that can be found in other countries in Africa: a highly diverse cultural background found in more than 200 ethnic groups, an exceptional geological, ecological and botanic potential, wildlife in its natural form and varied climatic conditions. This is the main reason why tourism is ranked 10th top priority of the President and his collaborators.
The objective is to make Cameroon a leading tourist destination. Mountaineering and tourism on mountains can also be practiced on the mountain ranges that are found allover the country. Safari can also be practiced by visiting the multitude of National parks which contain a diversity of mammals, birds and other beasts.
Henceforth a safari could be a visit to Waza to watch animals, then back to the Northern parks like that of Bouba Ndjidah, or Korup in the south and the Dja national patrimony to admire the riches of nature.
Cameroon has a good site for sea and beach loving visitors, with about 400 km of the Atlantic coast stretching along part of the country. Kribi and Limbe towns are the highest points of attraction for tourism on the coast. From these coasts, tourists can also carry out inland tourism to other destinations. In Kribi, there is an excellent beach of white sand extending over a large area with coconut trees from time to time appearing on the scenery. The contact between the Ocean and the sea is also an extraordinary site to see. Another wonder of Kribi is found in the south where a number of cascades of about 30 m high have given rise to waterfalls, the most spectacular being the Lobe fall which issues out directly into the Atlantic Ocean. A little bit above this area are fishing villages; Ebounja and Ebodje in which the activity is believed to be carried out miraculously. From Lobe, further visits on boats and canoes will take you to the discovery of the Pygmies of the equatorial Forest.
Also thanks to the geographic situation Cameroon, there is a high diversity of most fauna and flora species found in Africa, with some that can only be found in Cameroon. There are presently nine national parks serving as a safe haven for wildlife in its natural state. This are areas of safari in which visitors can observe, take photos and feel the presence of animals in nature. The Waza National Park is the most popular in Cameroon and one of the most spectacular in francophone black Africa. It is located in the Far North Province and is a paradise for lions and numerous mammals like giraffes, elephants, cheetahs, leopards etc as well as a great colony of diverse bird species.
Handicrafts and arts are made through out the country but the West and Northern parts of the country are leaders in the sector. Bafoussam, Foumban and Bamenda are towns that are noted for their masks, decorated costumes, chairs created in the form of thrones, pipes, sculptures and statues. In Maroua, there is an attractive multicolored market of decorated table cloths, locally tanned leather sleepers, bags and wallets of crocodile, snake or iguana skins, bracelets, hand-made carpets and decorative objects in general. There is also a rich historical patrimony in this region marked by monuments and antiquities as well as very ancient traditional palaces.
Cameroon today has about 20 protected areas in the form of national parks, game reserves and sanctuaries; being indisputable potentials for tourism and ecotourism.
The first national park in Cameroon dates over 30 decades and today she has double the total number of National Parks compared to a prominent tourist destination like Kanya.
The integration of environmental concerns into tourism development projects has led to the classification and protection of certain natural sites for scientific, ecological and tourist purposes. These include:
- Korup National Park, which harbours plant species which date back thousands of years;
- The Dja Reserve, classified as a World Heritage Site by UNESCO;
- Mount Cameroon with a summit at 4070 m
- Mayo Rey sites with fossilized dinosaur footprints;
- The botanical garden of Limbe.
Cameroon is known throughout the world for its prowess in football Other sports related to tourism are also developing like:
- Offshore big-game fishing
- The annual ascent of Mount Cameroon;
- Golf in Yaoundé and Tiko;
- Equestrian clubs in Yaoundé, Douala and Garoua.
Taxes in Cameroon
Cameroon’s tax system includes different types of taxes.
Direct taxes:
- Corporate tax
- Personal income tax
- Permits
- Licenses
- Property tax
Indirect taxes:
- VAT
- Registration fees and stamp duties
- Special tax on petroleum products
- Special income tax
Para-fiscal charges:
- Audiovisual fees
- Contribution to the SCF
- Contribution to the National Employment Fund
- Municipal taxes
- Social contributions.
Personal income tax
Personal income tax applies to all residents in Cameroon, including expatriates who are earning from Cameroonian sources of income. These include employees, pensioners, traders, farmers, artisans, landlords and other professionals.
Taxable income sources are the following:
- wages, pensions and annuities
- profits received by traders, artisans, farmers and liberal professionals
- property income, movable capital (whether assimilated or distributed by a corporation to people who are not known to tax authorities).
Tax rates range as follows:
- 10% – CFA 0 to CFA 2,000,000
- 15% – CFA 2,000,001 to CFA 3,000,000
- 25% – CFA 3,000,001 to CFA 5,000,000
- 35% – More than CFA 5 million
Note that an additional 10% municipal tax applies to the calculated tax amount.
Corporate tax
Corporate tax directly applies to all corporate profits over a 12 months period corresponding to the fiscal year. However, if a company has come into operation only six months before the end of the fiscal year, it is allowed to submit its first report 18 months later.
Corporate tax payers are legal persons from:
- corporations, even when it comes to sole traders
- partnerships, syndicates and civil societies which have opted for corporate tax
- public institutions, regional and local authorities and public and legal persons who are engaged in gainful activities.
Taxable income is then constituted by operations revenue (regardless of its nature) performed by the company during the fiscal year and after deduction of related expenses.
Furthermore, corporate tax only applies to companies’ whose revenue is generated in Cameroon. The business has to be conducted within an institutional framework or through a representative whose professional profile is indistinguishable from that of the company.
Corporate tax is levied at a rate of 35% plus a 10% municipal tax rate.
The tax return must be submitted to tax authorities at the latest on the 15th of March of each fiscal year
Whatever the case, except the cases of workers and natural persons subject to the discharging system, the minimum tax is 2.2% or 5.5% of turnover, depending on the tax regime applicable to the taxpayer.
Investing in Cameroon
This year, Cameroon will continue the elaboration of an integrated customs duty and tax system. This was revealed during the last meeting held between officials of the ministry of finance in February at Yaoundé.
This project, whose goals have not been disclosed yet, is supported by GIZ, the German agency for international cooperation.
According to tax authorities, this reform will contribute to the optimization and safeguarding of revenues collection during these times of economic depression spurred by the fall in oil revenues, which used to represents up to 25% of public revenues.
Cameroon’s economy potential to has the become one of the most prosperous and best placed to receive foreign direct investment in Africa.
Cameroon needs to attract foreign investors in order to finance its future projects of developing infrastructure and notably, the exploitation of gas.
Large French companies are well-placed in these developing sectors.
Why You Should Choose to Invest in Cameroon
The country’s strong points are:
– A cheap workforce; and
– Abundant natural resources;
The 2010-2011 economic plan contains measures likely to attract direct foreign investments, particularly in high capital areas (mining, food industry, energy and construction). In particular, the Cameroonian government is working on the establishment of a one-stop shop for the creation of companies.
Government Measures to Motivate or Restrict FDI
The Cameroonian government has targeted certain sectors as priority sectors for investment: transport, food industry, tourism and rural development. In order to attract more investors, significant programs are being implemented by the public authorities, with the support of financial backers, in order to improve judicial decisions, increase energy supplies, reinforce economic information, simplify procedures, support companies, and ensure the protection of the economic area against illegal threats. Cameroon also has free trade zones in which all export companies can set themselves up, that is to say, companies that produce goods and provide services meant exclusively for export. There are a many advantages for companies: exemption from all licenses, authorization or quota limitation for both export and import, possibility of being able to open a foreign currency account, no restrictions on sales operations, purchase of foreign currency, right to transfer profits abroad (however 25% has to be re-invested in Cameroon), tax and duty exemption for a period of 10 years from the beginning of operations and taxation at a general rate of 15% on profits from the 11th year.
Cameroon is the largest economy in the Central African Economic and Monetary Community (CEMAC) owing to its demography (a little over 20 million inhabitants), a surface area of 475 442 KM² and its geographical situation. As a result, Cameroon serves as a commercial hub to the CEMAC region; perhaps a reason why the spending power of Cameroonians has grown significantly during the past few years while also creating infinite opportunity for fast consumer goods. Local economists generally speak of a “puissance collective”, referring to a spending power estimated to be approaching $1.2 trillion. About 37 million persons inhabit the six member states (Congo Brazzaville, Chad, Central African Republic, Equatorial Guinea, Gabon, and Cameroon). Given that many of the CEMAC countries are inland based, Cameroon’s seaports serve as ports of entry for imports to these countries.
Cameroon is a member of the Multilateral Investment Guarantee Agency for the promotion of the flow of private foreign direct investment to developing countries. This agency provides political risk insurance coverage against the major non-commercial risks of war and civil upheavals, currency transfer and expropriation. It also provides technical assistance to member countries to enable them attract foreign investment. Also adding Cameroon’s suitability for investment are bilateral investment and/or commercial agreements with several countries including Austria, Belgium, Canada, China, Denmark, France, Germany, Greece, Italy, Japan, Russia, South Korea, Spain, Switzerland, the United Kingdom, and the United States. Similar agreements also exist with other countries in Africa, Asia, Latin America, and Eastern Europe.
Our members in Cameroon
Ashunchong and Partners Law firm is one of the reputable law firms in Cameroon, an affiliate to INCE & CO LPP in London, WRIGHT & CO in Freetown Sierra Leone and that focuses on rendering quality services to worldwide clients.
This firm came into existence ten years ago when a group of lawyers with the same vision and objectives in legal issues came together under the direction of the principal partner Barrister Ashunchong Paul Tanyi Ako.
It comprises of top quality lawyers whose experience and mastery of legal issues has given the firm the place it occupies today in Cameroon. They seek to render tailored services with the ultimate goal of clients’ satisfaction. Ashunchong and Partners Law firm is a full service law firm, equipped with trained legal professionals who understands the clients perspective to provide time bound legal services.
They address issues of corporate and commercial law, maritime and shipping, oil and gas, business law, commercial litigation, telecom law, investment law, intellectual property, debt recovery, immigration law, etc. We are a team of professionals who are closely related to issues and challenges faced by the Industry and provides practical solutions in terms of latest changes in law.
Their vision:
- Offer high level cost effective services to clients.
- To give client a brick and mortal home in a virtual world
- To accompany and support client in all legal issues.