RESTRICTEDWORLD  TRADE
ORGANIZATIONWT/TPR/S/87
20 June 2001
(01-2949)
Trade Policy Review Body
TRADE POLICY REVIEW
CAMEROON
Report by the Secretariat
This report, prepared for the  Trade Policy Review of Cameroon, has been drawn
up by the WTO Secretariat on its own responsibility.  The Secretariat has, as
required by the Agreement establishing the Trade Policy Review Mechanism
(Annex 3 of the Marrakesh Agreement Establishing the World Trade
Organization), sought clarification fr om the Government of Cameroon on its
trade policies and practices.  Any technical questions arising from this report
may be addressed to Ms. E. Lizano (tel. 739 5529) or Mr. W. Alfaro
(Tel. 739 5372).
Document WT/TPR/G/87 contains the policy statement submitted by the
Government of Cameroon.
Note: This report is subject to restricted circulation and press embargo until the end of the meeting
of the Trade Policy Review Body on Cameroon.Cameroon WT/TPR/S/87
Page iii
CONTENTS
Page
SUMMARY OBSERVATIONS vii
(1) E CONOMIC ENVIRONMENT vii
(2) T RADE AND INVESTMENT POLICY FRAMEWORK vii
(3) T RADE  AND TRADE -RELATED POLICIES AND MEASURES viii
(4) S ECTORAL ISSUES ix
(5) O UTLOOK x
I. ECONOMIC ENVIRONMENT 1
(1) I NTRODUCTION 1
(2) R ECENT ECONOMIC DEVELOPMENTS 1
(3) T RADE AND FOREIGN INVESTMENT PERFORMANCE 7
(i) Trade patterns 7(ii) Investment performance 9
(4) S
TRUCTURAL REFORMS – PAST AND FUTURE 10
(5) O UTLOOK 11
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 12
(1) G ENERAL LEGAL AND INSTITUTIONAL FRAMEWORK 12
(i) Executive and legislative branches of Government 12(ii) Advisory and consultative bodies 13
(iii) Main trade laws and regulations 14
(iv) Transparency and governance 15
(2) T
RADE POLICY OBJECTIVES 16
(i) General trade policy objectives 16(ii) Sectoral trade policy objectives 17
(3) T
RADE AGREEMENTS AND ARRANGEMENTS 17
(i) World Trade Organization 17
(ii) Regional agreements 19(iii) Other trade agreements or arrangements 21
(4) F
OREIGN INVESTMENT REGIME 22
(i) Regulatory framework 22(ii) International investment agreements 24
III. TRADE POLICIES AND PRACTICES BY MEASURE 25
(1) O
VERVIEW 25
(2) M EASURES DIRECTLY AFFECTING IMPORTS 25
(i) Procedures 25(ii) Customs valuation and rules of origin 27(iii) Tariffs 28
(iv) Other charges affecting imports 31
(v) Import licensing, prohibitions, and other restrictions 32(vi) Contingency measures 32(vii) Standards and technical requirements 34WT/TPR/S/87 Trade Policy Review
Page iv
Page
(viii) Government procurement 37
(ix) State-owned enterprises 38
(3) M EASURES DIRECTLY AFFECTING EXPORTS 40
(i) Registration and documentation 40(ii) Export taxes, charges and levies 41
(iii) Minimum export prices 41
(iv) Export prohibitions, restrictions, and licensing 41(v) Voluntary restraints 42(vi) Export assistance 42(vii) Export finance, insurance, and guarantees 43
(viii) Export promotion and marketing assistance 44
(4) M
EASURES AFFECTING PRODUCTION AND TRADE 44
(i) Incentives 44(ii) Protection of intellectual property rights 44(iii) Competition policy and regulatory issues 47(iv) Pricing and marketing arrangements 48
IV. TRADE POLICIES BY SECTOR 49
(1) I
NTRODUCTION 49
(2) A GRICULTURE AND FORESTRY 50
(i) Agriculture 50(ii) Forestry 53
(3) M
INING AND OIL 56
(4) M ANUFACTURING 58
(5) S ERVICES 59
(i) Overview 59(ii) Financial services 60(iii) Telecommunications 63
(iv) Transport 64
(v) Tourism 66
REFERENCES 67
APPENDIX TABLES 71Cameroon WT/TPR/S/87
Page v
CHARTS
Page
I. ECONOMIC ENVIRONMENT
I.1 Fiscal adjustment, 1993/94 – 1999/2000 5
III. TRADE POLICIES AND PRACTICES BY MEASUREIII.1 MFN frequency distribution, 2000 28
III.2 Tariff escalation, 2000 30
IV. TRADE POLICIES BY SECTORIV.1 GDP by sector 1993/94 – 1998/99 49
IV.2 Tariff averages for the manufacturing sector, by ISIC (Rev.2) 59
TABLES
I. ECONOMIC ENVIRONMENT
I.1 Cameroon at a glance, 1991-2000 2
I.2 Selected economic indicators, 1993-2000 3I.3 Exports by destination, 1994-2000 7
I.4 Imports by origin, 1994-2000 8
I.5 Principal exports by group of products, 1993-2000 8I.6 Imports by group of products, 1993-2000 9I.7 Foreign investment, 1994-2000 10
III. TRADE POLICIES AND PRATICES BY MEASURE
III.1 Applied MFN tariffs, 2000 29
III.2 Products subject to stamp and labelling requirements 35III.3 Privatization process 39III.4 Benefits provided under the Industrial Free Zone Regime 43III.5 Intellectual property protection periods under the Bangui Agreement (1977) and
Revised Bangui Agreement (1999) 45
IV. TRADE POLICIES BY SECTOR
IV.1 Production of main agricultural products, 1993-2000 51
IV.2 Forestry sector indicators, 1994-99 54
IV.3 Forestry licensing 55
IV.4 Summary of Cameroon's specific commitments in services 60WT/TPR/S/87 Trade Policy Review
Page vi
APPENDIX TABLES
Page
I. ECONOMIC ENVIRONMENTAI.1 Balance of payments, 1993-2000 73
AI.2 Imports by product, 1980-96 74
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVESAII.1 Selected trade-related legislation 75
AII.2 Investment incentives in Cameroon 76
III. TRADE POLICIES AND PRACTICES BY MEASUREAIII.1 Tariff average by HS chapter, 2000 77
AIII.2 Basic necessities exempted from value-added tax 80
AIII.3 Products subject to excise duties, 2000 81
AIII.4 Veterinary health inspection tax 82AIII.5 Products subject to technical endorsement prior to importation 83AIII.6 Prohibited imports 84
IV. TRADE POLICIES BY SECTOR
AIV.1 Applied MFN tariff averages, by ISIC (Rev.2), 2000 85Cameroon WT/TPR/S/87
Page vii
SUMMARY OBSERVATIONS
(1) ECONOMIC ENVIRONMENT
1. Since 1995, the Cameroonian
economy has started to recover slowly but
steadily from its earlier prolonged depression.
Growth has averaged 4.7% a year over thelast five fiscal years (1995/96-1999/00).  Over
the same period, inflation and the fiscal deficit
have been low.  The improved performance is
due mainly to the implementation of structural
reforms (economic liberalization andprivatization) as well as favourable external
events. Structural reforms have focused on the
privatization of state monopolies and price
liberalization to allow market forces to
allocate resources.  In this context, theGovernment sees trade liberalization as
integral to its efforts in modernizing the
economy. Trade policy objectives continue to
be oriented towards a more open trade
regime, and increasing market access for
Cameroon's exports.
2. Despite its recent improved growth,
Cameroon still suffers from widespread
poverty, deterioration in the education and
health systems, and weaknesses in
governance;  in 1999/00, GDP per capita had
not yet reached its pre-depression level.  Theauthorities seem committed to continuing the
reform process, including improvements in the
transparency of the legal system, particularly
to reduce poverty.  In concert  with the
continued reform effort, the IMF and theWorld Bank agreed at end-2000 to support a
comprehensive debt-reduction programme for
Cameroon under the HIPC initiative.
3. Agriculture and forestry are the main
contributors to GDP, with the petroleumsector also of considerable importance to the
economy.  Cameroon's exports are dominated
by petroleum and petroleum products.  Other
important export items include cocoa (notably
beans), coffee, aluminium, and lumber.
Manufactured products dominate imports.
The geographic pattern of Cameroon's tradehas remained more or less the same since
Cameroon's previous Review, in February1995: the European Union (EU) continues to
be the dominant market for exports
(accounting for around 66% of merchandise
exports in 1999/00) as well as the main source
of imports (50%);  France is the single largest
source of imports, accounting for about aquarter of total merchandise imports.  As
regards exports, Italy has overtaken France as
the main destination market.  Outside the EU,
Chad and the United States are important
export markets, and Nigeria, Japan, and theUnited States are important import sources.
(2) T
RADE AND INVESTMENT POLICY
FRAMEWORK
4. Cameroon's general trade policy
orientation and objectives have not changedsignificantly since its last Review. The
Government has continued to undertake
measures aimed at liberalizing its trade policy
regime, fostering the private sector's
involvement in the economy, improving
competitiveness, and promoting investment.
These objectives have been pursued mainlythrough a process of a revived regional
integration effort under the CEMAC
(Communauté économique et monetaire de
l'Afrique centrale), which also includes the
Central African Republic, Chad, EquatorialGuinea, Gabon and the Republic of Congo.
5. Responsibility for trade policy
formulation and implementation has remained
broadly unchanged during the review period.
Trade policy formulation is under theresponsibility of the Ministry of Industrial and
Commercial Development and the Ministry of
Economy and Finance.  Cameroon does not
have an independent statutory body to review,
or advise the Government on, economic andtrade policies.  Consultations with the private
sector take place on an ad hoc basis.
6. The authorities, aware of the
importance of a clearer legal framework to
support economic reform, are making efforts
to improve the transparency and enforcement
of current legislation; this should enhance thesystem's predictability and increase investor
confidence.WT/TPR/S/87 Trade Policy Review
Page viii
7. Cameroon is a founding Member of
the WTO and grants at least MFN treatment to
all its trading partners.  Its tariff binding
commitments cover around 15% of its total
tariff lines.  Cameroon holds observer status
in the Agreement on Trade in Civil Aircraft; inmid-2001, Cameroon will become an observer
to the Agreement on Government
Procurement.  As a developing country,
Cameroon used transition periods to
implement a number of  commitments under
various WTO Agreements.  The authorities
have expressed concerns about Cameroon's
implementation of the Agreements owing to a
lack of information and training.  Most of
Cameroon's annual notification requirementsunder the WTO Agreements are yet to be
fulfilled.  Enhanced technical assistance
efforts by WTO Members and the Secretariat
could greatly facilitate Cameroon's further
integration in the multilateral trading system.
8. Cameroon's trade policies and
practices are, to a large extent, determinedregionally under CEMAC.  Certain areas,
such as trade in services, are regulated by
both supra national, and national regulation
covering issues not subject to common
regional rules.
9. The CEMAC is based on an economic
and monetary union.  One of the objectives of
the Community is to establish a unified market
allowing for open trade and capital flows
between its Member States.  A CommonExternal Tariff (CET) is in place for trade with
third countries, while trade inside the
Community has been  duty free since 1998.
The CET has four rates:  5% (for essential
goods);  10% (for raw materials and capitalgoods);  20% (for intermediate goods);  and
30% (for consumer goods). A common
regional central bank (BEAC) establishes and
administers monetary policy for CEMAC
members.  Recent developments show that
progress has been achieved in the Community
towards economic union;  efforts are alsounder way for the harmonization of internal
taxation, facilitation of the movement of
persons and capital (a regional Investment
Charter was adopted in 1999), and the freecirculation of services.  However, trade
between Cameroon and its CEMAC partners
is low compared with the trade flows between
Cameroon and its main trading partners in
Europe.
10. Foreign investment is considered by
the Government as a key factor in Cameroon's
economic development.  Various initiatives
have been undertaken to attract foreign
investors, including the simplification of
administrative procedures, the provision ofspecific incentives, implementation of
competition legislation, judicial reform,
privatization, and a National Governance
Programme to fight corruption.  Cameroon's
investment legislation contains all the basicelements to provide an open liberal investment
climate.  However, it appears that the
implementation of these initiatives has been
slow.
(3) T
RADE  AND TRADE -RELATED
POLICIES AND MEASURES
11. Cameroon's main trade policy
instrument is the tariff. All applied tariffs are
ad valorem, and there are no seasonal or
variable rates, adding to the transparency of
the regime.  The simple average applied MFN
tariff was 18.3% in 2000, slightly lower thanthe prevailing average at the time of the last
Review.  As a result of the Uruguay Round
negotiations, Cameroon bound all its
agricultural (WTO definition) tariff lines at a
ceiling rate of 80%, while only three tariffrates levied on non-agricultural products were
bound.  The bound tariff rates are
substantially higher than the applied rates;
closing this gap would further improve
predictability of the tariff regime.
12. Imports, as well as domestically
produced goods, are subject to a value-added
tax (18.7%), and some products to a 25%
excise tax (alcoholic beverages, cigarettes,
cosmetics, and jewellery).  A temporary import
surcharge of up to 30% was levied on a few
products until June 2000. The relatively fewimport restrictions currently in place are
aimed at ensuring security, and protectingCameroon WT/TPR/S/87
Page ix
public health and the environment.  Customs
procedures have been streamlined through the
opening of a single-window facility.  For
customs valuation, Cameroon continues to use
the Brussels Definition of Value, but as of July
2001 it is expected to apply the WTO CustomsValuation Agreement.  Cameroon has
legislation regulating contingency trade
measures (anti-dumping, countervailing and
safeguards) but has not  applied such
measures to date.  Standardization is at anearly stage in Cameroon.
13. The Cameroon export regime has been
further liberalized during the review period.
At present, export licences apply only to
"sensitive" goods (e.g. gold and diamonds)while coffee and cocoa require an export
certificate to ensure quality.  Remaining
export prohibitions, such as on hazardous
products, are in place for health and
environmental reasons.  All export taxes,
except those levied on logs, have been
removed.  Exports of logs are also subject toquotas.  Cameroon does not grant any specific
assistance to exporters other than tax
incentives.  Tax incentives are also provided to
promote industrial development, encourage
exports, raise value added, and createemployment.  These incentives are contingent
upon export performance and, in certain
instances, on the use of domestic inputs.
14. Cameroon has introduced new
legislation on government procurement,particularly to enhance the transparency of
the regime.  In principle, local companies
receive a 20% price-preference margin on all
government procurement.  The Government
has undertaken efforts to fight corruption andincrease transparency;  it has established
requirements for wider tender announcements,
independent monitors for large contract
awards, and has instituted more regular audits
of tender awards.
15. Intellectual property legislation has
been revised at the regional level (under theAfrican Intellectual Property Organization,
OAPI), to seek compliance with the TRIPS
Agreement; implementation of the revisedlegislation still awaits ratification by five of
OAPI's 15 members.
16. The process of privatization in
Cameroon, which started in 1990, has
continued;  however, state monopolies remain
in some utilities (water and electricity).  In1997, a new law to regulate competition policy
was adopted and applies both to private and
public enterprises.  Services provided by state
monopolies, as well as some basic goods, are
subject to price controls.
(4) S
ECTORAL ISSUES
17. Agriculture and forestry remain
Cameroon's leading economic activities,
accounting for more than 40% of GDP and
providing employment for about 60% of thepopulation. The agriculture sector has
undergone thorough reform since 1994:
quantitative restrictions on imports and
exports have been removed, and most
parastatals have been privatized.  There have
also been some reforms in forestry; however,
export restrictions and taxes still apply tosome forestry products.  Export taxes on other
agricultural products, including cocoa, coffee,
cotton, sugar, and palm oil, were removed
recently.
18. The Government sees the development
of the agriculture sector as the best means for
reducing poverty in Cameroon and stimulating
economic growth.  It is determined to further
liberalize the sector, including through
privatization.  Its strategy is to improve thesector's competitiveness and enhance factor
productivity, with a view to strengthening
growth and increasing farmers' income.  The
Government's efforts are also aimed at
diversifying domestic production andpromoting export diversification.  The average
MFN tariff levied on agriculture (WTO
definition) is 22.5%.
19. Oil-related activities account for
around 5.5% of GDP and 45% of exports;
other mineral deposits in Cameroon remain
largely unexploited. The Government's policyobjectives are to develop the oil and mineralsWT/TPR/S/87 Trade Policy Review
Page x
sectors' potential through further
liberalization and provision of incentives, as
well as to increase efficiency and transparency
in the management of the oil sector. The
Government is to develop a legislative and
regulatory framework for mining, natural gas,and petroleum activities that will allow for the
development of offshore reserves, promote and
develop hydroelectric potential, and promote
the distribution of petroleum products.
20. Manufacturing in Cameroon remains
relatively underdeveloped and accounts for
around 14% of GDP.  Cameroon does not
provide industry-specific incentives.  The
Government's overall policy objective for the
sector is to support private-sector activity.  Astrategy to promote the development of
manufacturing is to be adopted by mid-2001;
efforts are aimed at promoting investment and
exports (to the regional market), and
improving professional and technical training.
21. The services sector contributes some
40% of GDP. Cameroon has eliminated mostof its previous restrictions on trade in services.
Remaining restrictions are limited to the so-
called strategic services, such as water
distribution, electricity, public transportation,
and telecommunications.  The performance ofthe services sector has been poor, and lack of
efficiency has impeded the development of
other sectors.  Some services have been
restructured, including through privatization
and the adoption of a new regulatoryframework aimed at attracting additional
operators so as to improve the quality and
provision of services.  This regime is not,
however, bound under the GATS.  Cameroon's
commitments under GATS cover only somesubsectors of business services, and tourism
and travel-related services.  Exemptions to
MFN treatment are maintained on maritime
transport.  Cameroon did not participate in
the WTO negotiations on basic
telecommunications, nor on financial services.
22. Cameroon's banking sector has
undergone a thorough reform.  Since the late
1980s, the authorities have implemented a
programme of privatization, liquidation, and
recapitalization of banks, and have reinforcedthe regulatory and supervisory capacity.  The
Government sold its last state-owned bank in
January 2000.  The Central African States
Bank (BEAC) regulates the sector through its
regional banking co mmission (COBAC),
which shares responsibility with the nationalministries of finance for licensing new banks.
Cameroon is one of the 14 African countries
that ratified the Treaty of the Inter-African
Conference on Insurance Markets (CIMA),
and adopted a common code with respect tothe insurance sector.
23. Important efforts have been made to
reform Cameroon's telecommunications
sector. The sector is now regulated by the
1998 Telecommunications Law, which callsfor the privatization of the sector and
established a regulatory body to ensure the
proper functioning of the industry and
competition among individual operators.
(5) O
UTLOOK
24. The Cameroonian authorities are
committed to continuing structural reform,with a view to stimulating private investment,
enhancing competition and efficiency, and
lowering costs, thus facilitating the efficient
allocation of resources, reflecting Cameroon's
comparative advantages, and improvingeconomic growth.  In order to attain
sustainable poverty reduction, Cameroon
needs to register high economic growth rates,
significantly improve efficiency in public
expenditure, and strengthen governance.Further efforts are needed to continue the
development of the physical and services
infrastructure of the economy, as well as to
improve the human capital base, to overcome
the constraints that weaknesses in these areasimpose on development effo rts.  By improving
the level of its multilateral commitments,
Cameroon could create confidence in the
irreversibility of its reforms and render them
more credible, thus improving its ability to
attract the needed foreign investment.
Cameroon's trading partners can assist itsreform efforts by ensuring stable, increased
access to their markets, in particular for
products of export interest to Cameroon.