Agribusiness for Africa’s Prosperity. Country Case Studies
Cameroon’s main trade policy instrument is the tariff. With the momentum gained by trade liberalization in the mid-1990s, Cameroon’s current trade policies and practices are largely determined by its participation in the Economic and Monetary Community of Central Africa (CEMAC). To effectively transform free trade into a development opportunity, the Cameroonian Government, through the Growth and Employment Strategy Paper (GESP) 2003, specifically targeted a key challenge for the whole economy, namely increased regional and international trade. However, the achievement of this objective faces considerable constraints that should be adequately addressed, for example: (i) lack of political will among the CEMAC Member States, (ii) poor local production sectors as a means to building a genuine capacity for trade, (iii) non-tariff barriers for intra-regional trade, and (iv) bad governance, etc. To address these constraints, a more active regional integration policy is required. As far as the post-liberalization period is concerned, Table 2.3 shows that export intensity almost trebled in the agro-industrial sector from 8.1 per cent of output in 1993 to 26.5 per cent ten years later, while the share of imports has barely changed at 11.5 per cent in 2003 (and 10.2 per cent in 1993). However, the crude figures mask the dominance of the wood sector as well as the very different performance in the various subsectors. In fact, in more than half of the subsectors – 8 out of 14 – export intensity has declined, and although there were substantial increases in wood, dairy products and processed fruit and vegetables, in all these cases the increases were occurring from a very low base. Therefore, and in terms of outward-orientation, the figures in Table 2.3 indicate difficulties of most agro-industrial subsectors; their participation in global trade is limited, possibly reflecting weak infrastructure, low levels of technology and know-how, the deficient quality and quantity of exports, and an inability to overcome non-tariff barriers to trade, such as sanitary and phyto-sanitary measures. This is consistent with the view of most observers, for example, Chang et al. (2009) who believe that the benefits of trade liberalization depend on the economic and institutional characteristics that enable a country to adjust to the new conditions imposed by international openness. The wood industry dominates agro-industry trade, with exports accounting for over half of total output in 2003, underlining the industry’s exceptionally strong competitiveness position. In contrast, while export intensity in the furniture subsector has increased, the export share of production in 2003 was an infinitesimal 0.3 per cent. In dairy products and processed fruit and vegetables the export intensity has more than doubled to 18 per cent. With the exception of the two subsectors – wood, and dairy, fruit and vegetable processed products – the absolute export figures are only marginal, meaning that reported changes in export intensity are very small. The import share of the agro-industrial production was virtually unchanged over the ten-year period, but the subsectors have experienced divergent trends as there was a decline in imports as a share of output in 10 of the 14 subsectors. In some industries import intensity fell markedly – notably in leather and footwear, grain mill products, and tobacco – but for most of the others, while percentage changes were substantial, in absolute terms the magnitudes were slight. Given the fact that even large percentage changes in export and import intensity are hardly meaningful for interpretation if manufacturing value added is very small, the annual rates of change in addition to changes over the entire period are also reported. We see that export intensity grew in all subsectors except in furniture. Import intensity increased in 7 out of 14 subsectors, with the tobacco industry leading, and it decreased in the remaining subsectors. The largest decline (-12.95 per cent) occurred in wood.
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