Overview

Country Overview
Cameroon is a lower middle income country with a population of 21.7 million people. Situated in Central Africa, it shares a border with Nigeria, Chad, Central African Republic, Equatorial Guinea, and Gabon. Two regions are Anglophone (the northwest and southwest regions that border Nigeria) while the rest of the country is Francophone. It is endowed with significant natural resources, including oil and gas, high value timber species, minerals, and agricultural products such as coffee, cotton, cocoa, maize, cassava.

Political Context
Since independence in 1960, Cameroon has enjoyed a high level of political stability, in spite of its highly diverse population and conflicts along its borders with neighboring countries. Cameroon’s Senate was inaugurated in May 2013 and it held legislative and local elections in September 2013. Out of the 180 members of parliament, 56 are women.

Social Context
After a significant decrease in poverty rates in the 1990s, the poverty rate in Cameroon has stagnated at a national average of around 40% (40.2% in 2001 and 39.9% in 2007). Chronic poverty stands at about 26%. These averages are high compared to other countries in the region with similar economic characteristics.

There are wide regional disparities in poverty and depths of poverty in Cameroon. The poor—in terms of numbers and level of poverty—are concentrated in the four northernmost provinces: the far north, north, Adamawa, and the east. Access and quality of services are also lagging significantly behind the other provinces. Cameroon is off track to meet most of the MDGs by 2015, despite improvements in universal education and access to water.

Economic Overview
After years of weak economic growth, growth continues to strengthen but is still too low to address poverty and development needs. Preliminary estimates indicate that growth reached 4.8% in 2013 - compared to 4.6% in 2012 – with the tertiary sector (telecommunications and transport in particular) being the main driver of growth. In 2013, prices rose moderately and the inflation rate ended the year well below the regional convergence criterion of 3%. The overall price level increased by 1.6% in 2013 (year-on-year), compared to 2.5% over the same period the year before.

Cameroon is a member of the Central African Economic and Monetary Community (CEMAC by its French abbreviation). The country’s medium-term fiscal policy seeks to limit the budget deficit during periods of high oil revenue by using this revenue to fund growth-oriented investment, thus ensuring that future generations will not be burdened with unsustainable levels of debt. The introduction of the budget program, starting in 2013, also paves the way for more efficient public spending.

Development Challenges
Cameroon suffers from weak governance, which affects the country’s development and ability to attract investments. Cameroon ranks 144th out of 177 countries in the 2013 Transparency International corruption perceptions index (144th place is shared with Central African Republic, Iran, Nigeria, Papua New Guinea, Ukraine, and Cameroon).  Cameroon ranks 168th out of 189 economies in the 2014 Doing Business report, down from 162th place in 2013.

Last Updated: Apr 21, 2015

World Bank Group Engagement in Cameroon

Cameroon’s main challenge over the next several years will be to significantly increase economic growth and investments, as well as implement policies that will ensure inclusive growth. This will require improvements in the investment and business climate, important investments in infrastructure, better governance, efficient public spending, and spending policies that target the needs of the population. It will also require a focus on sectors with high growth potential such as energy, agriculture, telecommunications, mining, and transport.

The Bank’s Country Assistance Strategy for Cameroon covers the 2010-2014 period and is aligned with the 2010-2013 Growth and Employment Strategy (Document de Stratégie pour la Croissance et l’Emploi, or DSCE using the French acronym) as well as the country’s stated vision and priorities for development. The strategy has two pillars of engagement: enhancing competitiveness and enhancing service delivery, with a cross-cutting governance lens. A new strategy will be prepared in 2015.

In an effort to enhance Cameroon’s competitiveness, the World Bank’s is supporting the country in three main areas: increasing infrastructure investment in the energy, transport, and telecommunications sectors; conducting activities aimed at ensuring the transparent, equitable and sustainable use of natural resources; and developing high-potential-value chains and improving the business climate. Promoting regional integration will also be key to improving competitiveness.

The World Bank is also helping Cameroon improve service delivery in three main areas: human development, establishment of a social safety net system, and local development with a focus on increasing access to basic services through infrastructure upgrades and capacity building.

The World Bank portfolio in Cameroon currently stands at $1.36 billion in commitments and consists of 23 projects, including 14 national projects, six regional projects and three trust fund-administered projects. 

Last Updated: Apr 21, 2015

Developing Rural Areas and Improving Social Services
The multi-donor, International Development Association (IDA) funded Community Development Program Support Project is an important instrument used in the implementation of the government’s rural development strategy. The project assists the government of Cameroon in setting up and implementing a decentralized financing mechanism to ensure participatory community development in rural areas and improve access to basic social services.

The first phase of the program, approved in 2004, covered six out of the country’s ten regions. A second phase, approved in June 2009 for $40 million (World Bank financing), expands program activities to all regions and small towns and consolidates the achievements of the first phase. Overall, the program has generated strong local support from the towns and communities involved.

The project has accomplished the following: helped to improve school infrastructure around the country, provided 270,000 people with access to potable water, and improved the access of 20,000 households to roads and basic social services.

Improving Agricultural Competitiveness
Current World Bank engagement in the agricultural sector consists of two IDA-financed lending operations: (i) The Agricultural Competitiveness Project ($60 million) to increase the competitiveness of beneficiary producer organizations working on target value chains, and (ii) the Agriculture Investment and Market Development Project ($100 million in IDA funds and $25 million in IFC funds) to help transform low-productivity, subsistence-oriented cassava, maize, and sorghum subsectors into commercially-oriented and competitive value chains in four agro-ecological zones. An additional joint World Bank - IFC operation, the Livestock Development Project ($100 million in IDA funds to be delivered in 2017), will help improve productivity, market access, and livelihoods of small livestock farmers in targeted agro-ecological zones.

Enhancing Regional Trade and Integration
World Bank support to the Cameroon transport sector consists primarily of the CEMAC - Transport and Transit Facilitation Project (CEMAC-TTFP), the Cameroon Multimodal Transport Project (CMTP) and the Africa Road Safety Corridor Initiative (ARSCI).

The CEMAC Transport and Transit Facilitation Project is a regional IDA project totaling $680 million, out of which $409 million (62%) is designated to Cameroon. The project also assists Chad and the Central African Republic. The project’s objective is to facilitate regional trade among the CEMAC member states and improve Cameroon's, Chad's, and the Central African Republic’s access to world markets.  The project is supported by the European Commission (EC), the African Development Fund (ADF), France, and Japan.

The Cameroon Multimodal Transport Project (CMTP) was approved in May 2014 to finance the complete restoration of a 61 km stretch of the Maroua-Mora road through a traditional bill of quantities approach. These works complement ongoing rehabilitation works under the parent CEMAC-TTF project between Mora and Kousseri, which is co-financed by the Government of Cameroon. It includes a five-year pilot performance-based contract for routine maintenance of a 270 km section of the road from Maroua to Kousseri (fully financed by the government of Cameroon through the Road Maintenance Funds), limited rail upgrading works (signaling), and technical assistance. It is a national IDA project of $91 million, out of which $71 million are IDA funds.

The road safety activities envisaged under the Africa Road Safety Corridor Initiative (ARSCI), a regional trust fund, will provide a critical interface between public sector interventions and work on improving commercial freight. It supplements the more global approach of road safety undertaken as part of the CEMAC-TTFP. The project is based on a partnership model that creates a synergy amongst the various ongoing road safety activities in the public, private, and humanitarian sectors within the framework of the Central Africa Corridor. It documents the corridor’s road safety activities and their results in a way that maximizes learning and sharing among stakeholders.

Boosting Cameroon’s Electricity Production
Cameroon is seeking to increase investments in the energy sector to boost the country’s development and strengthen economic growth. To help Cameroon achieve this goal, the World Bank’s energy team is preparing a new IBRD financed operation, the Electricity Transmission and Reform Project. The main objectives of the project will be to improve the capacity, efficiency and stability of Cameroon’s national electricity transmission network, and strengthen the government’s capacity to develop cost-efficient hydropower projects.

The Kribi Gas Power Project, a joint World Bank-IFC project was approved in November 2011, with committed IDA financing of $82 million. The Kribi Gas Power Project will provide up to 216 MW of capacity that will feed into Cameroon’s southern integrated grid through a 100 km transmission line. The project triggered the first commercial development of Cameroon’s substantial gas reserves which have the potential to complement Cameroon’s growth from oil. It will benefit 163,000 households, including households located in rural areas, and make 50 MW available to Aluminium du Cameroun (Alucam) through a power purchase agreement with AES SONEL at cost-reflective prices with positive benefits for the economy.

Last Updated: Apr 21, 2015

Cameroon is one of the least aid-dependent countries in Sub-Saharan Africa. International partners such as the World Bank, the African Development Bank (AfDB), the European Union (EU), the Agence Française de Développement (AFD), the European Investment Bank (EIB), the Central African Economic and Monetary Community (CEMAC), the Banque de Développement des États de l’Afrique Centrale (BDEAC), the International Monetary Fund, the United Nations, and Germany have strengthened their coordination mechanisms in order to further the Paris Declaration and Busan agenda.

The 2010 - 2013 Growth and Employment Strategy (Document de Stratégie pour la Croissance et l’Emploi, or DSCE using the French acronym) envisions a strengthened partnership with nontraditional donors, including the BRIC countries (Brazil, Russia, India and China), Korea and the Islamic world.

 

Last Updated: Apr 21, 2015


LENDING

Cameroon: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments