IV. Public Enterprise Reform in Cameroon70
Author: International Monetary Fund
Publication Date:
03 Dec 1996
eISBN:
9781451807998
Language:
English
Keywords:
ISCR; CR; enterprise; export; GDP ratio; export commodity; Cameroonian authorities; commodity export; CFA franc; Public enterprises; Agricultural commodities; Exports; Private investment; Sub-Saharan Africa; Southeast Asia; enterprise performance; government policy; government portfolio; public enterprise reform program; core enterprise; Privatization; Public sector; Government subsidies
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This paper provides an overview of the public enterprise sector in Cameroon and the results of the parastatal reform efforts so far. The reform effort, which started in 1986, has frequently experienced delays brought on by an inadequate legal and institutional framework, and by a lack of consensus on the scope and desirability of the withdrawal by the government from involvement in the major sectors of the economy. As a result, limited progress has been made in the liquidation and privatization of parastatals. The paper is divided into four sections. Section A provides an overview of the evolution of the public enterprises sector and of its financial performance. Section B describes the government’s public enterprise reform program and discusses in detail the specific measures that have been undertaken, while Section 3 summarizes the main results of the reform and highlights the public enterprises’ present financial situation. Section D provides some concluding remarks.

Abstract

This paper provides an overview of the public enterprise sector in Cameroon and the results of the parastatal reform efforts so far. The reform effort, which started in 1986, has frequently experienced delays brought on by an inadequate legal and institutional framework, and by a lack of consensus on the scope and desirability of the withdrawal by the government from involvement in the major sectors of the economy. As a result, limited progress has been made in the liquidation and privatization of parastatals. The paper is divided into four sections. Section A provides an overview of the evolution of the public enterprises sector and of its financial performance. Section B describes the government’s public enterprise reform program and discusses in detail the specific measures that have been undertaken, while Section 3 summarizes the main results of the reform and highlights the public enterprises’ present financial situation. Section D provides some concluding remarks.

This paper provides an overview of the public enterprise sector in Cameroon and the results of the parastatal reform efforts so far. The reform effort, which started in 1986, has frequently experienced delays brought on by an inadequate legal and institutional framework, and by a lack of consensus on the scope and desirability of the withdrawal by the government from involvement in the major sectors of the economy. As a result, limited progress has been made in the liquidation and privatization of parastatals. The paper is divided into four sections. Section A provides an overview of the evolution of the public enterprises sector and of its financial performance. Section B describes the government’s public enterprise reform program and discusses in detail the specific measures that have been undertaken, while Section 3 summarizes the main results of the reform and highlights the public enterprises’ present financial situation. Section D provides some concluding remarks.

A. Background

During the postindependence period, Cameroon pursued a policy of state-directed economic development. This was based on the authorities’ concern that the nascent private sector could not assume a leading role in economic development and that foreign companies might pursue their own investment and development strategies without regard to national priorities. The policy also evolved from the authorities’ desire to secure peace and to distribute wealth “equitably” among the different regions, as well as among its political constituency. Hence, the state assumed the leading role as the “engine of economic growth and development” and the number of public enterprises grew dramatically throughout the 1960s and 1970s. In 1963, the government created the state-owned investment company Société Nationale d’Investissement (SNI) with the aim of channeling public resources into the productive sectors of the economy.71 The authorities also purchased shares in existing foreign companies, both directly and through the SNI.72 The pace of expansion of public enterprises picked up during the “oil boom” and “cocoa and coffee boom” of the 1970s.73 With the increase in export revenues, key public entities such as the petroleum parastatal Société Nationale de Hydrocarbures (SNH) and the cocoa and coffee marketing board Organisation Nationale de Commercialisation des Produits Bruts (ONCPB) built up large cash reserves.

These funds, along with those of the central government and the SNI, were used to finance the expansion of the public enterprise sector. By the mid-1980s, there were approximately 219 public enterprises, of which 103 were in the services sector, 68 were in the manufacturing sector, and 48 were in the agricultural sector. Together, these enterprises employed an estimated 72,010 workers (equivalent to 10.4 percent of the formal sector work force) and accounted for roughly 18 percent of GDP.

It is important to define precisely what is meant by a “public enterprise” within the Cameroonian context. Although there is no specific legal definition of a public enterprise, the government considers an enterprise to be “public” if the state holds 25 percent or more of its share capital.74 There are four legal forms of public enterprises: limited-liability companies (LLC), state enterprises (SE), development corporations (DC), and public establishments (PE). LLCs are incorporated companies that are regulated by the country’s commercial law. In cases where the state or another public enterprise retains 25 percent or more of an LLC’s shares, the company is considered to be a public enterprise. A SE is an LLC in which the capital is held entirely by the state, as is the case only for the SNI and the national telecommunications company (INTELCAM). A DC is an LLC that is created and regulated by decree,75 and where the state is not the sole shareholder. Twelve DCs have been created, all in the agriculture/agro-industrial sector.76 A PE is a public entity that does not have equity capital and whose operations are supported through direct government subsidies and/or through the sale of goods and services. There are two subcategories of PEs, administrative public establishments (APE) and industrial and commercial public establishments (ICPE). APEs are enterprises that serve a purely social or administrative role and rely upon government subsidies, while ICPEs are entities that engage in the production and sale of goods and services while also pursuing social and administrative objectives, which qualifies them to receive government subsidies. Table 1 provides a breakdown of the public enterprise portfolio by legal classification as of March 1996, including those in the process of being restructured, privatized, and liquidated.

Table 1.

Cameroon: Public Enterprises by Legal Classification, 1996

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Source: Cameroonian authorities.

The efficiency and profitability of the public enterprise sector compares unfavorably with that of private enterprises. In a recent study,77 comparisons were made between public and private enterprises78 regarding investment efficiency, productivity, profitability, and financial leverage (Table 2). In each of these cases, enterprises in which the state held a majority share performed consistently below those in which the state held a minority share. The main findings were that relative to their private counterparts, public enterprises were undercapitalized, had lower profitability or were loss-making, and had lower levels of investment efficiency and productivity.

Table 2.

Cameroon: Comparison of Key Financial Indicators 1

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Source: Company reports.

Average of data reported for 1990 and 1993.

Asset turnover is the ratio of sales to investment.

The financial position of public enterprises deteriorated throughout the mid-1980s, as reflected by their increased reliance on direct budgetary subsidies from the central government (Table 3). While public enterprises earned profits of CFAF 13 billion in 1984/85, they in fact generated losses of CFAF 56 billion (1.5 percent of GDP) if the CFAF 69 billion of government subsidies (equivalent to 9 percent of total government revenues) is taken into account.79 The following year, these enterprises generated cumulative losses of CFAF 121 billion (3 percent of GDP) net of the CFAF 68 billion of government subsidies (equivalent to 8 percent of government revenues). The degree of government subsidization was even greater when “hidden subsidies” incurred in the form of unpaid taxes, unpaid social security contributions, and unpaid bank loans are taken into consideration.80

Table 3.

Cameroon: Direct Government Subsidies to Public Enterprises

(In millions of CFA francs)

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Source: Cameroonian authorities.

In 1986, Cameroon entered into a prolonged economic crisis, which had a major impact on government revenue and severely restricted the government’s ability to support the public enterprise sector. The crisis underscored the importance of parastatal reform, which effectively started in that year.

B. The Reform Effort

The reform of the public enterprise sector began in June 1986 with the establishment of an interministerial committee81 as the prime decision-making body, and a secretariat82 charged with implementing the committee’s decisions.83 Financial sector public enterprises were subsequently withdrawn from the control of the secretariat in December 1992 and were placed under the authority of a banking sector unit within the Ministry of Finance.

Government policy regarding the reform of public enterprises was articulated initially in a 1988 Government Directive84 and was further elaborated in the Government’s Declaration of Strategy and Economic Recovery of May 1989.85 The program was supported by a World Bank Structural Adjustment Loan (SAL), which became effective on November 28, 1989. The aim of the reform effort was fourfold:

  • to reduce the burden of public enterprises on public finances and on the rest of the economy through the elimination of subsidies and the liquidation and privatization of certain enterprises;

  • to improve the performance of public enterprises remaining in the state portfolio through performance contracts;

  • to rationalize the government’s policy of direct participation in the production of goods and services; and

  • to rationalize the institutional environment within which public enterprises operated.

The government subsequently defined a general framework regarding privatization in 1990,86 defined new rules for state intervention in the economy87, and issued a General Statute on Public Enterprise Reform in 1995.88 Together, these documents constitute the legal and institutional framework for parastatal reform. For analytical purposes, the reform effort can be divided into two distinct phases. The first phase (1988/89 to 1993/94) focused primarily on the “rehabilitation” and “restructuring” of those public enterprises that were to be maintained within the government portfolio, while the second phase (1994/95 to the present) focused on the “disengagement of the state” through privatization and liquidation of nonviable public enterprises.

Rehabilitation of public enterprises, 1988 to 1994

In October 1987, the Technical Commission initiated a census of public enterprises with the aim of classifying them into one of three categories. Enterprises that were considered to be strategic or that provided public services were to remain in the government’s portfolio and be “rehabilitated.” Of the remaining enterprises, those that were believed to be financially viable were to be “privatized” while those that were considered to be nonviable were to be “liquidated.” The Technical Commission classified an initial group of 75 priority enterprises along these lines in August 1990 (Table 4). This list was subsequently expanded to include all 219 enterprises in existence at that time.

Table 4.

Cameroon: Classification of Public Enterprises, 1990–94

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Source: Cameroonian authorities.

Including the enterprises in the SNI portfolio that are not classified elsewhere.

Rehabilitation

Twenty-six of the nonfinancial public enterprises to be maintained in the public portfolio were to be “rehabilitated” over a period of three years (1989 to 1992) on the basis of performance contracts. These contracts between the government and the enterprises specified the objectives of the rehabilitation, the obligations being undertaken by both the state and the enterprise, and the modalities for monitoring contract implementation. However, these performance contracts and the monitoring process were fraught with problems. While the government’s public enterprise secretariat was responsible for overseeing the rehabilitation process, it was not a party to the performance contract and did not have adequate resources for monitoring. As regards the performance contracts, these documents were modeled upon the same generic format and were not adapted to the specific circumstances of a particular enterprise. While broad objectives were often defined in the contracts, the specific actions required to attain them were not. The lack of viable financial accounting and information systems further inhibited knowledge and understanding of the true situation and problems facing the enterprises. In addition, the costs to the government and the enterprise were often not explicitly stated in the contract, nor was it clear what the enterprise “should” do versus what it “could” do. Probably most important, management and personnel problems plaguing certain public enterprises were not addressed since the same management teams were maintained and staffing was not reinforced.

Thus, despite performance contracts, the financial operations of the public enterprises did not improve significantly. Pre-subsidy operating losses were only marginally reduced, from CFAF 68 billion (1989) to CFAF 52 billion (1992).89 As indicated in Table 5, the direct financial costs to the government in carrying out the performance contracts were an estimated CFAF 460 billion over the three-year period 1989–92 in the form of capital increases, debt assumption, subsidies, and dropped claims. According to the government’s national debt management agency,90 public enterprise debt obligations assumed by the government over the period 1988/89–1995/96 alone were some CFAF 352 billion (Table 6). As regards the 95 public enterprises in the government portfolio that were not subject to performance contracts, very little was done to supervise their operations and financial performance. Although an information system was established in 1993 to monitor public enterprise financial performance, it was limited to only the 17 largest public enterprises.91

Table 5.

Cameroon: Cost of Public Enterprises Performance Contracts, 1989/90–1991/92

(In millions of CFA francs)

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Source: Cameroonian authorities.
Table 6.

Cameroon: Cost to Government of Public Enterprises Performance Contracts, 1988/89–1995/96

(In billions of CFA francs)

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Source: Caisse Autonome d’Amortissement du Cameroun.

Privatization

Since the government’s (and donors’) focus was primarily on rehabilitation and restructuring, very little was done in the area of privatization during the initial stage of the reform. Fifteen enterprises were identified for privatization under a government decree in 1990.92 Over the four-year period 1990–94, however, only 5 of these 15 enterprises were sold. Of the remaining 10 enterprises, 2 were withdrawn from the privatization list, 3 were subsequently liquidated, and 5 were pending further action. The reasons for this poor performance were manyfold. In general, the government did not have an explicit strategy for privatization, nor did it put in place the necessary legal and institutional framework to support the privatization process.93 Added to this was a heavy bureaucratic process, which required numerous authorizations, often requiring the approval of the Head of State himself. Moreover, many of the companies selected for privatization had poor prospects for growth and profitability.94 At the same time, the government often overestimated the value of these enterprises and was reluctant to sell below their reservation price.95 The negotiation process itself was poorly managed and time was often wasted on unqualified parties, owing to the absence of even minimal due diligence on potential buyers. Finally, there was no fixed calendar and little sense of urgency regarding the privatization process. At present, 8 of the original 15 enterprises have been sold, 4 have been liquidated, and 3 are pending further action.

Liquidation

Although liquidation was the simplest process to initiate, it proved to be the most problematic to implement. There are four ways in which an enterprise can be liquidated. Amiable liquidation occurs in the case of a limited liability company when the shareholders decide to bring an end to the company’s activities during a General Assembly. In cases where an LLC’s assets do not cover liabilities, judicial liquidation can be invoked either by the shareholders or the creditors, thereby forcing the company to be dissolved or its assets sold. With regard to development corporations and public establishments (which are created through a decree), dissolution occurs when the state issues a decree to that effect. A final form of liquidation involves fusion-absorption or the merging of one enterprise into another. This can occur for an LLC, as well as for PEs.96 Of the 59 enterprises to be liquidated, 33 were companies held within the SNI portfolio and 26 were owned directly by the government. By the end of 1994, only 4 of the 59 liquidations had been completed, with the liquidation of the remaining 55 enterprises still being in process. The main reasons for the poor performance in this area was the lack of a streamlined legal and institutional framework for liquidation.97 Each of the forms of liquidation had its own set of procedures and none set fixed timetables for the completion of the liquidation process. The liquidation procedures themselves were often carried out by civil servants under the direction of the Ministry in charge of the enterprise, which limited the liquidator’s freedom to operate. In addition, public announcements of the liquidation were rarely made, which retarded the process of identifying creditors and outstanding obligations of the enterprise. Moreover, the government was reluctant to bring individual liquidation proceedings to closure because such actions would “formalize” the loss of past wages to employees, which could have important political drawbacks.

Recent developments, 1994–96

In the 1994 declaration of general policy on public enterprise reform, the government revised its approach by shifting its focus to privatization instead of rehabilitation. It defined new rules for intervention in the economy that implied a disengagement of the state from the productive and commercial sectors and a reorientation toward basic needs. As a first step, on July 14, 1994 the government issued a list of 15 additional public enterprises to be privatized.98 On June 1, 1995, the authorities decided to associate the private sector in the management of the water (SNEC), electricity (SONEL) and telecommunications (INTELCAM) public utilities. To strengthen the institutions charged with public enterprise reform, in January 1996, the Technical Commission was divided into two distinct units for privatization and rehabilitation, thereby reducing possible conflicts between the tasks of portfolio management and privatization.

As regards monitoring and control over the public enterprises maintained in the state portfolio, the government promulgated an ordinance in August 1995 that defined the General Statute of Public Enterprises.99 The statute sets the legal and institutional framework governing the conduct and control of public enterprises. The legislation explicitly brought all public enterprises into conformity with common business law.100 It established an improved system of accountability regarding the management of public enterprises,101 financial controls,102 and fraud.103 The government is also reinforcing its Public Enterprise Information System (SISEP) for the current 17 core enterprises being monitored. Under a technical assistance project supported by the World Bank, private accounting firms are carrying out financial audits of these enterprises with the aim of providing comprehensive accounting of their financial performance from 1992/93 to the present. These data will replace the current data being used to monitor enterprise performance, which, as noted earlier, suffer from inaccuracies and inconsistencies. In addition, the government intends to expand the SISEP over the medium term to include all of the major enterprises that are to remain in the state portfolio.

With regard to liquidation, the 1995 Statute on Public Enterprises also established new rules and regulations to ensure transparency, fairness, and efficiency of the dissolution and liquidation process. Dissolutions are legally required to be announced within eight days of the decision taken by the public or mixed company’s general assembly. Upon commencement of the liquidation process, managers are legally required to step down and contracts and legal actions are suspended. Liquidation procedures are explicitly defined and follow the laws and customs commonly employed throughout the world.104

C. Results of the Reform Effort

Since the start of the reform effort, the public sector portfolio has comprised a total of 225 enterprises. As of March 1996, 40 public enterprises were earmarked for privatization (Table 7). Of these, 12 have already been privatized, 18 are in the process of being privatized, and 10 are subject to ongoing diagnostic studies. A total of 89 public enterprises have been earmarked for liquidation, of which 12 are financial institutions. Of the 89 enterprises to be liquidated, only 4 have completed the process. The remaining 96 enterprises will be retained as public enterprises.

Table 7.

Cameroon: Status of Public Enterprise Reform Effort as of March 1996

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Source: Cameroonian authorities.

Of which 8 enterprises have been privatized.

Of which 2 enterprises have been privatized.

Of which 2 enterprises have been privatized.

The most recent data on the 15 largest public enterprises show a continuing deterioration in their financial performance. The deficit in their cumulative overall balance (including transfers) increased from CFAF 2.5 billion in 1994/95 to CFAF 5 billion in 1995/96 (Table 8). According to their accounts, these public enterprises still receive some CFAF 296 million in direct government subsidies. Total net transfers to the government increased from CFAF 26 billion to CFAF 34 billion, consisting of some CFAF 30 billion in direct taxes, CFAF 5 billion in indirect taxes, and CFAF 4 billion in dividends. The total stock of public enterprise debt stood at an estimated CFAF 752 billion, of which CFAF 234 billion was external debt guaranteed by the central government and CFAF 518 billion was domestic debt (Table 9). Of the total domestic debt, 45 percent (CFAF 232 billion) was to the government, 37 percent (CFAF 192 billion) was to other public sector entities, and 18 percent (CFAF 93 billion) was to the private sector. Although the public enterprises collectively had CFAF 234 billion in debt to the central government, the government had outstanding obligations to these enterprises of some CFAF 459 billion, thereby making it a net debtor of CFAF 227 billion. Details on public enterprise net domestic debt to the government, along with the breakdown by key enterprises, can be found in Table 10.

Table 8.

Cameroon: The 16 Largest Public Enterprises—Selected Financial Indicators 1/

(In millions of CFA francs)

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Source: Cameroonian authorities.

Excluding SHN.

Table 9.

Cameroon: Public Enterprise External and Domestic Debt, 1994

(In billions of CFA francs)

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Source: World Bank.

Guaranteed by the central government.

Table 10.

Cameroon: Public Enterprise Net Domestic Debt to Government, 1994

(In billions of CFA francs)

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Source: World Bank.

D. Concluding Remarks

The results of the public enterprise reform effort to date are mixed. The initial phase of the reform focused primarily on the rehabilitation of those enterprises that were to be maintained in the government’s portfolio. While performance contracts were negotiated with many of these enterprises, there was little improvement in their operation and management in recent years. Other public enterprises continue to operate without performance contracts and direct oversight. The government’s ongoing efforts to improve the coverage and scope of its information monitoring system represent important steps aimed in part at addressing this situation. Whether the authorities are able to effectively use this information in overseeing these enterprises’ operations, and whether these enterprises in turn are able to operate efficiently, remains to be seen. As regards divestiture, recent legislation appears to have addressed many of the problems previously caused by the lack of an adequate legal and institutional framework. Hence, although the pace of public sector divestiture to date has been slow and fraught with delays, a firmer foundation has been set that can lead to an acceleration in both the privatization and liquidation processes over the ensuing years.

Table 11.

Cameroon: Public Enterprises-Selected Financial Indicators, 1994

(In billions of CFA francs)

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Source: World Bank.
70

Prepared by Brian Ames.

71

Over the twenty-year period 1965–85, the SNI invested some CFAF 67 billion in equity participation in about 80 companies.

72

Key examples include Brasseries du Cameroun (brewery), SIC-CACAOS (cocoa processing), ALUCAM (aluminum), ALUBASA (aluminum), SOCATRAL (aluminum), SAFACAM (agriculture), and CIMENCAM (cement).

73

The export of crude oil from Cameroon commenced in 1977/78.

74

See Government of Cameroon Decree 86/656, (6/3/86).

75

SDs are regulated by the Law of 11 June 1968 and the modalities of state control are defined in Decree 68/DF/275 (7/15/68).

76

SDs were created to play a primarily development role in a specific region of the country and often based on the production of a specific commodity in which the region had a natural advantage. Examples include SODECOTON in the north (cotton) and SODECAO in the center-south (cocoa).

77

“The Cameroon Privatization Program: Issues and Prospects,” Public Policy Papers, Continental Consulting Partners, (5/94, pp. 14–15).

78

The study classified enterprises into two categories, public and private. In certain cases, enterprises where the state held equity in excess of 25 percent were still considered to be “private” because the private sector was the majority shareholder and controlled the enterprises’ Board of Directors and senior management.

79

“Bilan des Operations de Rehabilitation, Privatisation, et Liquidation des Entreprises du Secteur Public et Parapublic: 1986–1993”, Commission Technique, Mission de Rehabilitation des Entreprises du Secteur Public et Parapublic, République du Cameroun, (5/94, p.6).

80

The World Bank estimated that hidden subsidies amounted to some CFAF 400 billion in 1991, representing roughly 12 percent of GDP. See “Cameroon Public Enterprise Reform Program: Overview and Proposed Action Plan”, op. cit.

81

The composition of the Interministerial Committee was modified by Decree 90/428 of (2/27/90) and presently consists of the Director General of the SNI, the National Director of the BEAC and five cabinet ministers: Economy and Finance; Industry and Commerce; Civil Service and Administrative Reform; Agriculture; and Labor.

82

Republic of Cameroon, Decree 86/656 of (6/3/86).

83

However, the secretariat was not staffed until June 1987 and did not become operational until September of that year.

84

Republic of Cameroon, Instruction No. 007 (11/4/88).

85

Republic of Cameroon, “Declaration of Strategy and Economic Recovery,” (5/89).

86

Republic of Cameroon, Ordonnance No. 90/004, of 6/22/90 (which defines the general framework of the privatization operation) and Decree No. 90/1257, of 8/30/90 (which established the practical modalities regarding privatization).

87

République du Cameroun, La Déclaration de Politique Générale Relative aux Entreprises du Secteur Public et Para-Public, (5/94).

88

See Republic of Cameroon, Ordinance No. 95/003 (8/17/95).

89

World Bank, “Privatization and Private Sector Technical Assistance Project,” Technical Annex, Report No. P-6928-CM (5/22/96, p.4).

90

Caisse Autonome d’Amortissement du Cameroun (3/6/96).

91

Even this reporting system suffered from severe limitations regarding the comprehensiveness, accuracy, and comparability of data between enterprises.

92

Decree 90/1423 (10/3/90).

93

There were several different laws and regulations regarding the privatization process.

94

With the exception of OCB (bananas), SOCAMAC (port handling and transit monopoly), SEPBC (Timber handing and transit monopoly) and CHOCOCAM (chocolate), the remaining companies earmarked for privatization were not sound. SEAC (equipment) and CREVCAM (shrimp) were already bankrupt, SODERIM (rice) was not viable, IMPRIMERIE NATIONALE (printing) faced stiff competition and was plagued with antiquated equipment, and GETRAM and SCDM (steel products) were not able to survive in open competition.

95

The evaluation process was based primarily on asset valuation.

96

Nine public enterprises fell into this category.

97

As noted above, there are a variety of liquidation modalities. In the case of judicial liquidations, the existing legislation (the Law of 4 March 1889) is outdated and is subject to multiple interpretations.

98

Under Presidential Decree No. 94/125 (7/14/94), the following public enterprises were added to the privatization list: CAMAIR (airline), CDC (tea, palm oil, rubber, bananas), C AMSHIP (shipping line), C AMTAINER (cargo containers), SOTUC (public transportation) HEVECAM (rubber), REGIFERCAM (railroad), SCT (tobacco), SOCAPALM (palm), SODECOTON (cotton), SPFS (palm oil), SRL (palm oil refinery), ONAPHARM (pharmaceuticals), SOCATOUR (travel agency), and SEAC (equipment).

99

Republic of Cameroon, Ordinance No. 95/003 (8/17/95).

100

The Minister of Finance solely exercises the state’s shareholder rights. In addition, public enterprises are required to publish an annual balance sheet in the official gazette, as well as in the national press. Accounts are to be audited and certified by official auditors and special independent audits can be mandated.

101

For example, a person cannot be a Director or Chairman in more than three public companies; a Director cannot serve more than three consecutive terms on the same Board; no one can occupy the position of Chairman as well as General Manager; Directors’ direct or indirect personal interest in their companies must be declared; and no civil servant, politician or parliamentarian may serve in any management function.

102

Public companies are to be run according to the rules of private companies, with strict accountability to their shareholders.

103

Managers of public enterprises are now punishable for fraud, concealment, falsification, and the like, and, in the case of bankruptcies, can be pursued in the courts. Liquidators and auditors are also to be held liable for their actions.

104

Liquidators are to be professionals who will now work under the control of the Minister in charge of Finance. Liquidators’ mandates will be limited in time (one year, renewable) and all creditors (including the state) are to be treated equally. The sole exception is with regard to employees’ compensation (i.e., back salaries, severance pay, and the like), which has absolute priority over all other claims. Public tenders are to be used, strict accounting procedures are to be followed, and payments are to be made in order of chronological seniority.

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Cover IMF Staff Country Reports
Cameroon: Selected Issues and Statistical Appendix
Author: International Monetary Fund
Volume/Issue:
Volume 1996: Issue 125
Publisher:
International Monetary Fund
ISBN:
9781451807998
ISSN:
1934-7685
Pages:
131
DOI:
https://doi.org/10.5089/9781451807998.002