Cameroon’s Economic Update: Harnessing Forests and Natural Wealth for Sustainable Growth

The 2025 Cameroon Economic Update, titled "Cameroon’s Green Gold: Unlocking the Value of Forests and Natural Capital’’ provides a comprehensive analysis of the nation’s recent economic developments, medium-term outlook, and the critical role of wealth accounting in assessing the country’s economic performance. The report places a special emphasis on the importance of sustainable forests and natural resources management as drivers of inclusive and resilient development.

Key findings

The first part of the report analyzes recent economic developments and presents the country's medium-term outlook. Global economic growth stabilized in 2024, supported by easing inflationary pressures and the initial phases of monetary policy loosening across both advanced economies and emerging market and developing economies. Cameroon’s real GDP grew by 3.5% in 2024, up from 3.2% in 2023, driven by higher cocoa prices and cotton yields, as well as an improved power supply.

Average inflation decreased from 7.4% to 4.5% between 2023 and 2024, reflecting the impact of sustained monetary policy tightening, price controls, and a reduction in imported inflation. The current account deficit declined from 4.1 in 2023 to 3.4% of GDP% in 2024, due to cyclical factors especially soaring cocoa bean prices. The overall fiscal deficit widened to 1.5% of GDP in 2024, up from 0.7% of GDP one year ago, due to slippage in current expenditures and weaker than expected revenue performance. The overall level of public debt increased in 2024 to finance a higher primary deficit.

Looking ahead, the medium-term outlook is moderately positive, though surrounded by major uncertainties due to ongoing major shifts in trade and fiscal policies by advanced economies and increased geopolitical tensions and conflict, which is likely to result in more difficult market access, higher interest rates, and increased volatility in the commodity markets.

Average real GDP growth is projected to moderately increase to 3.9% over 2025 to 2028, supported by improved power supply for industrial companies and increased public investment, with positive effects on the construction sector.

Average inflation is expected to continue declining, reaching the 3% CEMAC convergence criterion by 2027. The current account deficit is expected to stabilize around 4.0% of GDP over the medium term, accounting for the decline in oil production and prices, the mixed outcomes from government industrial policies, and higher imports required for increased public and private investment.

The fiscal deficit is projected to increase moderately to 2.0% of GDP due to declining oil revenue. While Cameroon’s external and overall public debt are expected to remain sustainable, the country faces a high risk of debt distress due to liquidity issues.

The second part of the report underscores the importance of wealth accounting for sustainable forestry management. By assessing the evolution of the level and composition of national wealth, policymakers can better understand the capacity of an economy to generate future income and sustain development.

Despite overall growth in total wealth which reached $553 billion in 2020, up from $311 billion (real chained 2019 $) in 1995, national wealth per capita declined by 11% between 1995 and 2020. Adjusted net savings (ANS) adjust national saving for changes in a country’s wealth, providing a broader picture of a nation’s economic sustainability and ability to invest in its future.

Cameron's ANS was moderately negative between 2010 and 2020, indicating that the country is depleting its wealth slightly faster than it is accumulating new assets. Cameroon’s forest depletion accelerated dramatically after 2010, with significant conversion of lowland forests to forest-farm mosaics between 2010 and 2020 exceeding five times the rate observed in the previous decade. Beyond the reduction in forest extent, the ecological condition of Cameroon’s forests has deteriorated significantly, as evidenced by satellite-derived metrics such as tree height, canopy cover, forest connectivity, and landscape naturalness.

Key recommendations

To minimize the environmental impact of growth and preserve natural wealth, Cameroon must prioritize its high-value, vulnerable ecosystems and transition to a forest-based service economy, leveraging ecotourism, medicinal services with its unique flora, and forest-based knowledge. The report advocates for climate finance models that recognize forests as repositories of planetary option values, beyond results-based payments for avoided emissions.

Specific recommendations include:

1. Integrating forest condition metrics into national land-use classification systems and informing fiscal transfer formulas where possible,
2. Invest in regular natural capital accounting and valuation of forest services.