2.2.1 Household living conditions surveys

115. The quantitative or monetary approach to poverty is based on the method of basic food and nonfood needs, identified using data from the two Cameroonian Household Surveys (ECAM I and II) that were conducted nationwide in 1996 and 2001. They provided a clear picture of the status of poverty and living conditions in Cameroonian households.

116. The 1996 household survey (ECAM I), which was the first of a series, was conducted just as Cameroon was emerging from a severe economic crisis that had lasted for nearly a decade. That survey was able to measure the effects of the crisis and of structural adjustment programs on household living standards and conditions. The ECAM II survey, which was undertaken in September 2001, updated the poverty profile and served in preparing benchmark indicators to monitor progress in reducing poverty. It also provided the basis for preparing the complete PRSP.

117. The ECAM II survey covered all 10 provinces of Cameroon, and was conducted in both urban and rural areas using a sample of 12,000 households, of which 10,992 were actually visited. By contrast, for the ECAM I survey the country was divided into six strata (Douala, Yaoundé, other cities, forests, high plateaus, savanna) and the sample size was 1800 households, of which 1731 were actually interviewed.

2.2.2 The standard-of-living indicator and the poverty threshold for 2001

118. The standard of living indicator used for determining the poverty threshold is annual household final consumption. The poverty threshold was thus set at 232,547 CFA francs in 2001, versus 148,000 in 1996. The corresponding incidence of poverty is 40.2 percent for 2001, and 50.5 percent for 1996. For purposes of comparing the poverty situation between 1996 and 2001, a new threshold of 185,490 CFA francs was estimated. The incidence of poverty was then reevaluated at 53.3 percent in 1996; the indicators for 2001 remained unchanged, ECAM II being taken as the benchmark survey, because of the size of its sample. Most of the ECAM survey data used in this paper for analyzing this dimension of poverty were calculated for comparative purposes.

2.2.3 The changing poverty profile in Cameroon

2.2.3.1 Incidence and intensity of poverty

119. On the basis of the two surveys, ECAM I and II, the poverty rate declined by about thirteen percentage points over the five years, from 53.3 percent to 40.2 percent of the population.⁶ During the same period, the gap by which the average income of poor households fell below the poverty line also improved, shrinking from 19.1 percent in 1996 to 14.1 percent in 2001. This indicates that in 1996 it required an average annual supplementary transfer of 35,426 CFA francs to lift an individual out of poverty, compared with 26,154 francs in 2001

Table 1:

Poverty rate trend (%)

Source_: DSCN, ECAM I and II Reports

Table 1:

Poverty rate trend (%)

	1996	2001	Change As%
Incidence (P0)
Rural	59,6	49,9	-9,7
Urban	41,4	22,1	-19, 3
Total	53,3	40,2	-13,1
Depth (P1)
Rural	21,5	18,3	-3,2
Urban	14,7	6,3	-8,2
Total	19,1	14,1	-5,0

Source_: DSCN, ECAM I and II Reports

View Table

Table 1:

Poverty rate trend (%)

	1996	2001	Change As%
Incidence (P0)
Rural	59,6	49,9	-9,7
Urban	41,4	22,1	-19, 3
Total	53,3	40,2	-13,1
Depth (P1)
Rural	21,5	18,3	-3,2
Urban	14,7	6,3	-8,2
Total	19,1	14,1	-5,0

Source_: DSCN, ECAM I and II Reports

Box 2.

Heavy inroads against poverty

The poverty assessment study was conducted on the basis of comparability-adjusted data from ECAM I of 1996 and ECAM II of 2001. The main difficulty was to construct comparable aggregates between the two years, given the differences in the questionnaires, the survey methodologies, and the sampling schemes. After careful examination of these differences, a number of correction factors were considered. With these correction factors, 12 welfare measurement indicators were calculated and the sensitivity of the results was analyzed.

Poverty threshold in	Incidence of poverty		Change
CFAF	1996	2001
151.398	40.2	28.9	−11.3
185.490	53.3	40.2	−13.1
233.456	68.0	53.5	−14.5

View Table

Poverty threshold in	Incidence of poverty		Change
CFAF	1996	2001
151.398	40.2	28.9	−11.3
185.490	53.3	40.2	−13.1
233.456	68.0	53.5	−14.5

A sensitivity analysis of dynamic comparisons (national, urban, rural) and inter-regional comparisons (urban vs. rural) was performed for these 12 indicators. The results show that, regardless of the level of the welfare indicator used, poverty declined between 1996 and 2001.

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In arriving at this conclusion, we conducted a dominance analysis to confirm that poverty had indeed retreated between 1996 and 2001, regardless of the poverty threshold selected. This analysis involved examining the household income distribution functions for 1996 and 2001, plotted on the same graph. For each point on the curves, the abscissa (horizontal or x-axis) represents a certain income level, while the ordinate (vertical or y-axis) represents the proportion of individuals with incomes below that level. By setting the poverty threshold at any point along the x-axis, we can find the poverty incidence (the ordinate) corresponding to that threshold.

The distribution functions show that, with a “reasonable” poverty threshold, the 2001 income distribution dominates that for 1996. In other words, whatever the poverty threshold selected as reasonable, poverty is consistently lower in 2001 than in 1996. The decline in poverty between 1996 and 2001 is therefore a robust result that is not dependent on the poverty threshold selected. The above table makes clear this decline in poverty between the two years, as illustrated by one of the 12 welfare indicators and three different levels for the poverty threshold.

[Graph: x-axis: “Standard-of-living indicator”]Source: MINEPAT/DSCN

2.2.3.2 The regional dimension of poverty

120. The survey results also show that poverty is still more pronounced in rural than in urban areas. In 2001, eight poor people out of ten were living in the countryside, and the incidence of poverty there is more than double the incidence in the cities. An analysis of the depth of poverty shows that it would take an income transfer of some 43,500 CFA francs per year to lift a rural dweller out of poverty, or four times as much as it would take for an urban dweller (10,000 CFA francs). The two largest cities, Douala and Yaoundé, account for 20 percent of the country’s total population, but only 11.8 percent of those classed as poor.

Table 2:

Incidence of poverty by region (%)

Source: DSCN, ECAM I and II Reports

Table 2:

Incidence of poverty by region (%)

Zone	1996	2001	Change
Urban	41.4	22.1	−19.3
Douala	37.3	18.5	−18.8
Yaoundé	49.0	18.3	−30.7
Other cities	36.3	26.2	−10.1
Rural	59.6	49.9	−9.7
Forest	72.5	55.4	−17.1
High Plateaus	62.9	50.7	−12.2
Savanna	44.4	45.7	1.3
Total	53.3	40.2	−13.1

Source: DSCN, ECAM I and II Reports

View Table

Table 2:

Incidence of poverty by region (%)

Zone	1996	2001	Change
Urban	41.4	22.1	−19.3
Douala	37.3	18.5	−18.8
Yaoundé	49.0	18.3	−30.7
Other cities	36.3	26.2	−10.1
Rural	59.6	49.9	−9.7
Forest	72.5	55.4	−17.1
High Plateaus	62.9	50.7	−12.2
Savanna	44.4	45.7	1.3
Total	53.3	40.2	−13.1

Source: DSCN, ECAM I and II Reports

121. The analysis of rural poverty shows that it is distributed according to agro-ecological zones. Incidence is highest in the forest zone and in the high plateaus. In those areas, however, there has been a noticeable decline in poverty: the incidence was 55.4 percent and 50.7 percent, respectively, in 2001, compared to 72.5 percent and 62.9 percent in 1996, representing a decline of 17.1 and 12.2 percentage points respectively. On the contrary, the phenomenon has accentuated in the savanna zone (especially in the North and Extreme-North provinces), where the incidence rose by 1.3 percentage points.

122. The situation described above, which is common to many African countries south of the Sahara, suggests that policies and strategies for reducing poverty should place particular emphasis on the countryside, and on a region-by-region approach.

Box 3.

The decline of poverty: the growth effect and the redistribution effect

A comparative analysis of results from the ECAM I and II surveys suggests that the incidence of monetary poverty declined by about 13.1 percentage points between 1996 and 2001, from 53.3 percent to 40.2 percent. This decline may have resulted from strong growth in average incomes (the “growth” effect), or from an improvement in income distribution (the “distribution” effect).

A breakdown of the poverty trend in Cameroon shows that its decline is due primarily to the effects of economic growth, rather than to redistribution. Of the 13.1 percentage points by which poverty retreated between 1996 and 2001, 11.8 can be attributed to the growth effect, and only 1.8 to the redistribution effect. It is the cities that have shown the sharpest decline. The incidence of urban poverty has retreated by 19.3 percentage points, compared to 9.8 in the countryside. Yet the advantage that cities have over the countryside in this regard is due to a significant shift in income distribution among urban dwellers. In fact, the redistribution effect has pushed down the incidence of urban poverty by 8.4 percentage points. At the same time, it is gratifying to note that economic growth has benefited urban and rural dwellers alike, accounting in both cases for 11.8 percentage points of the total decline.

Table 3:

Breakdown of the trend of poverty indicators between 1996 and 2001 (%)

Source: ECAM I, ECAM II

Table 3:

Breakdown of the trend of poverty indicators between 1996 and 2001 (%)

	Total change		Growth effect		Redistribution effect
	P0	P1	P0	P1	P0	P1
Rural	−9.8	−3.1	−13.3	−6.6	1.7	3.4
Urban	−19.3	−8.3	−9.0	−4.7	−8.4	−4.7
Total	−13.1	−4.9	−11.8	−5.9	−1.8	0.6

Source: ECAM I, ECAM II

View Table

Table 3:

Breakdown of the trend of poverty indicators between 1996 and 2001 (%)

	Total change		Growth effect		Redistribution effect
	P0	P1	P0	P1	P0	P1
Rural	−9.8	−3.1	−13.3	−6.6	1.7	3.4
Urban	−19.3	−8.3	−9.0	−4.7	−8.4	−4.7
Total	−13.1	−4.9	−11.8	−5.9	−1.8	0.6

Source: ECAM I, ECAM II

A similar analysis can be applied to the depth of poverty (P1), which has retreated nationally by 5.9 percentage points, thanks essentially to the growth effect. Again, the cities have shown a sharper decline (8.3 percentage points). This is attributable above all to economic growth and, secondarily, to the reduction in income disparities.

The severity of poverty (P2) has also declined nationally by 2 percentage points. This decline was weak in rural areas, and can be attributed to economic growth, while it was fairly strong in the cities, where it is attributable as much to a reduction in income inequality as it is to growth.

Source: MINEPAT/DSCN

2.2.3.3 “Monetary” inequality in Cameroon

123. An analysis of the poverty incidence trend is not enough, by itself, to appreciate fully the progress that has been made in reducing poverty. It needs to be supplemented by an analysis of the trend in income distribution disparities, in order to have a complete picture of the dynamics of monetary poverty. In fact, it may be that a relatively equitable income distribution, or a high concentration of households around the mean income and the poverty threshold, is what explains the apparent improvement in poverty incidence.

124. An analysis of income distribution in Cameroon using the ECAM II results shows that there are considerable gaps between the poor and the nonpoor, on one hand, and between urban and rural dwellers on the other. It also suggests that there was little narrowing of inequalities between 1996 and 2001. In fact, average annual income, estimated by mean expenditure per adult equivalent, is eight times higher among the nonpoor as among the poor (963,882 CFA francs versus 85,495 CFA francs in 2001), and it is twice as high in the cities as in the countryside (408,115 CFA francs versus 233,734 CFA francs).

125. Yet the gap between the poor and the nonpoor is more pronounced in the cities than in the countryside, indicating that urban income distribution is more highly skewed. Poor rural households devote more than 56 percent of their income to food. Overall, households spend 7.6 percent of their total annual budget on health, and 5.4 percent on education.

Box 4.

Measuring inequality

In the economic literature, it is often recognized that growth can coexist with poverty, if there are no appropriate income distribution policies in place. Such a situation generally translates into a worsening, or at best a stagnation, of income inequalities. Similarly, a more equitable distribution of national income from one year to the next will tend to reduce poverty.

From the results of ECAM I and II, it can be seen that the decline in poverty has not been followed by any narrowing of inequalities. Indicators of inequality, such as the GINI index, log variance and the coefficient of dispersal between the first and last quintiles show that, despite poverty’s retreat, inequalities, far from shrinking, have remained constant and have in some cases increased. For example, in 1996 the richest 20 percent consumed seven times as much as the poorest 20 percent; in 2001, this ratio was eight to one.

These results reinforce the need to accompany growth policies with appropriate policies for distributing the fruits of that growth among all segments of the population. In particular, rural development policies and strategies must recognize these results and seek to correct disparities between cities and countryside.

Table 4:

Income inequalities: GINI index and average expenditure by quintile

Source: DSCN: ECAM I and II Report

Table 4:

Income inequalities: GINI index and average expenditure by quintile

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Gini index	0.449	0.345	0.406	0.406	0.369	0.408
Average expenditure by quintile (CFA francs)
Poor (bottom 20%)	77,824	80,398	79,724	94,166	83,956	85,495
Rich (top 20%)	66,3805	491,856	585,168	758,960	600,618	693,882
Total	322,421	200,805	243,240	408,115	233,734	294,403

Source: DSCN: ECAM I and II Report

View Table

Table 4:

Income inequalities: GINI index and average expenditure by quintile

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Gini index	0.449	0.345	0.406	0.406	0.369	0.408
Average expenditure by quintile (CFA francs)
Poor (bottom 20%)	77,824	80,398	79,724	94,166	83,956	85,495
Rich (top 20%)	66,3805	491,856	585,168	758,960	600,618	693,882
Total	322,421	200,805	243,240	408,115	233,734	294,403

Source: DSCN: ECAM I and II Report

Source: MINEPAT/DSCN

126. A dynamic analysis indicates that, while the incidence of absolute poverty declined over the last five years, this cannot be said of inequalities. In fact, the ratio of the average annual income of the richest 20 percent of households (the top quintile) to that of the poorest 20 percent (bottom quintile) remained high and stable at a factor of about 8, thereby confirming the robustness of income inequalities. The Gini index also remained stable and relatively high during this period (0.406 in 1996 and 0.408 in 2001). This places Cameroon in the upper mid-range of countries in the region in terms of income inequality.

127. The significant progress reflected by the decline in poverty incidence shows clearly that it is sensitive to growth and to welfare policies. Yet the persistence of a high level of inequality also indicates that there is ground to be made up in terms of the impact of policies on poverty. The policies and strategies to be followed in the context of poverty reduction, then, must be designed both to intensify growth, in order to raise average incomes, and to ensure a better distribution of the fruits of growth.

2.2.4 The sociodemographics of poverty

128. Analyzing poverty according to sociodemographic variables allows us to differentiate by sex and age of the household head, as well as by household size. Such an analysis also affords a better understanding of the phenomenon of poverty, and allows for better targeting of policies and actions to reduce this scourge. For example, a policy to promote subsistence crops as a means to food self-sufficiency and income generation could be specifically targeted at women, both as producers and as people who are particularly vulnerable.

2.2.4.1 Poverty and the sex and age of the household head

129. An analysis by sex of the household head yields encouraging information about the gender gap. The incidence of poverty in households headed by women is slightly lower than that of households headed by men (38.7 percent versus 40.6 percent). It is important to note, however, that 3 out of 4 households are headed by men, and that nearly 8 out of 10 poor people live in households headed by men.

Table 5:

Poverty incidence by sex and age of household head (%)

Source: MINEPAT/DSCN: ECAM I and II Reports

Table 5:

Poverty incidence by sex and age of household head (%)

		1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Sex
Male	42.4	60.0	54.2	22.5	49.7	40.6
Female	36.4	55.8	45.8	20.7	50.6	38.7
Total	41.4	59.6	53.3	22.1	49.9	40.2
Age
> 30	32.9	39.6	36.6	15.4	39.9	31.1
years
30 – 39	35.6	48.2	42.3	17.2	45.6	34.4
40 – 49	35.6	56.0	45.7	21.3	48.1	37.7
50 year	46.9	65.6	60.1	26.1	53.7	44.7
+
Total	41.4	59.6	53.3	22.1	49.9	40.2

Source: MINEPAT/DSCN: ECAM I and II Reports

View Table

Table 5:

Poverty incidence by sex and age of household head (%)

		1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Sex
Male	42.4	60.0	54.2	22.5	49.7	40.6
Female	36.4	55.8	45.8	20.7	50.6	38.7
Total	41.4	59.6	53.3	22.1	49.9	40.2
Age
> 30	32.9	39.6	36.6	15.4	39.9	31.1
years
30 – 39	35.6	48.2	42.3	17.2	45.6	34.4
40 – 49	35.6	56.0	45.7	21.3	48.1	37.7
50 year	46.9	65.6	60.1	26.1	53.7	44.7
+
Total	41.4	59.6	53.3	22.1	49.9	40.2

Source: MINEPAT/DSCN: ECAM I and II Reports

130. An analysis by age of the household head shows that the poverty rate rises with the age of the household head, regardless of place of residence. This situation was observable both in 1996 and in 2001. Moreover, the poverty rate rises with household size: poor households have an average of 6.6 members, while the average for nonpoor households is 4.2.

131. The above results show no significant difference in the poverty rate between the sexes. However, poverty reduction strategies should always pay particular attention to women, particularly since analysis using other indicators reveals great discrepancies between the sexes. For example, school enrollment indicators show women at a disadvantage. Specifically, the adult literacy rate is 59.8 percent for women vs. 77 percent for men, the school enrollment rate is 76.2 percent for girls ages 6 to 14 vs. 81.3 percent for boys in the same age bracket, and only 3.5 percent of persons living in a female-headed household have access to formal credit, vs. 5.5 percent for those in male-headed households. These elements affect the relative ability of the sexes to generate incomes over the medium-term.

Table 6:

Literacy of household head and children’s school enrollment (%)

Source: DSCN: ECAM I and II Report

Table 6:

Literacy of household head and children’s school enrollment (%)

		1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Literacy rate
Women	79,2	40,7	52,0	83,1	46,6	59,8
Men	88,3	63,7	72,2	92,4	66,5	77,0
Total	83,9	51,1	61,5	87,8	55,7	67,9
School enrollment rate
Girls	81,8	69,6	73,1	89,9	69,6	76,2
Boys	80,2	79,0	79,3	91,1	77,1	81,3
Total	81,0	74,5	76,3	90,5	73,5	78,8

Source: DSCN: ECAM I and II Report

View Table

Table 6:

Literacy of household head and children’s school enrollment (%)

		1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Literacy rate
Women	79,2	40,7	52,0	83,1	46,6	59,8
Men	88,3	63,7	72,2	92,4	66,5	77,0
Total	83,9	51,1	61,5	87,8	55,7	67,9
School enrollment rate
Girls	81,8	69,6	73,1	89,9	69,6	76,2
Boys	80,2	79,0	79,3	91,1	77,1	81,3
Total	81,0	74,5	76,3	90,5	73,5	78,8

Source: DSCN: ECAM I and II Report

2.2.4.2 Poverty and the household head’s education level and economic activity

132. The survey results also show that socioeconomic variables have a significant effect on the profile of poverty in Cameroon. Those with less education, small farmers, farm laborers, and non-management wage earners in the public sector are particularly affected by monetary poverty. Naturally, all of these variables are correlated with the fundamental factors of education and economic activity.

133. As a reflection of the importance of education among poor households, 40 percent have no schooling (see contribution). Among the total unschooled population, one household in two is poor. This poverty incidence declines as the household head’s level of education rises. It is clear, then, both for 1996 and 2001, that the higher the level of education, the greater the chances to earn income and to escape from poverty.

Table 7:

Poverty incidence by household head’s level of education

Source: MINEPAT/DSCN: Rapports ECAM I et II

Table 7:

Poverty incidence by household head’s level of education

	1996	2001	contribution
No diploma	59.6	50.1	39.5
Primary	60.4	47.8	41.5
Secondary 1c	47.8	31.2	13.4
Secondary 2c	33.9	17.6	4.4
Higher	7.6	7.7	1.2
Total	53.3	40.2	100

Source: MINEPAT/DSCN: Rapports ECAM I et II

View Table

Table 7:

Poverty incidence by household head’s level of education

	1996	2001	contribution
No diploma	59.6	50.1	39.5
Primary	60.4	47.8	41.5
Secondary 1c	47.8	31.2	13.4
Secondary 2c	33.9	17.6	4.4
Higher	7.6	7.7	1.2
Total	53.3	40.2	100

Source: MINEPAT/DSCN: Rapports ECAM I et II

134. The occupation of the household head also appears to be an important factor distinguishing the poor from the nonpoor. Households where the head is a farmer are the category most affected by poverty, with an incidence of 57 percent. These households accounted for nearly 7 poor people out of 10. Next to this group of households comes the group where the head works in the informal agriculture sector, with an incidence of 54 percent. The households best protected against poverty are those where the head is either a manager in the public or private sector, an employee in the formal private sector, or a proprietor in the informal nonfarm sector. The poverty incidence for these households varies between 7 and 22 percent. Yet non-management public sector employees suffer a poverty incidence of 25 percent or one person in four. This result shows the profound inequalities between the senior ranks and other employees in the public sector.

Table 8:

Poverty incidence by household head’s occupational category

Source: MINEPAT/DSCN: ECAM II Reports

Table 8:

Poverty incidence by household head’s occupational category

	Incidence	Contribution
Senior/managerial public sector	6.9	0.9
Other public employees	24.9	3.7
Senior/managerial private sector	11.3	1.6
Other private sector employees	16.8	2.4
Farmers	57.0	66.6
Informal farm workers	54.2	2.0
Informal nonfarm proprietors	22.3	0.6
Nonfarm self-employed	34.4	10.4
Nonfarm employees	27.1	3.3
Unemployed	25.0	2.9
Students	13.5	0.1
Retirees	18.4	1.0
Disabled	50.6	3.2
Others not in workforce	40.9	1.4
Total	40.2	100

Source: MINEPAT/DSCN: ECAM II Reports

View Table

Table 8:

Poverty incidence by household head’s occupational category

	Incidence	Contribution
Senior/managerial public sector	6.9	0.9
Other public employees	24.9	3.7
Senior/managerial private sector	11.3	1.6
Other private sector employees	16.8	2.4
Farmers	57.0	66.6
Informal farm workers	54.2	2.0
Informal nonfarm proprietors	22.3	0.6
Nonfarm self-employed	34.4	10.4
Nonfarm employees	27.1	3.3
Unemployed	25.0	2.9
Students	13.5	0.1
Retirees	18.4	1.0
Disabled	50.6	3.2
Others not in workforce	40.9	1.4
Total	40.2	100

Source: MINEPAT/DSCN: ECAM II Reports

Box 5.

Vulnerability

An objective analysis of vulnerability consists of studying the consequences of an exogenous shock on the household living standard indicator. For example, how much would poverty incidence vary if the monetary poverty threshold were raised or lowered by the five percent?

Such an analysis is useful in studying variability. For example, take two different types of household, one headed by a public sector employee or a formal private sector worker, living below the poverty threshold but with a fairly stable income, and a farmer’s family that is above the threshold but sees sharp fluctuations in its income (because of poor climatic conditions, difficulties in getting the produced a market, etc.). A standard static analysis of poverty would class the first household among the poor and the second among the nonpoor. Yet both are exposed to a certain degree of vulnerability, the first because it cannot attain the poverty threshold and the second because it must survive periods of extremely low income. If the farmer’s family has no access to instruments for smoothing its consumption pattern or raising its income, it may need a safety net of some kind in order not to fall into poverty. On the other hand, the civil servant’s family needs a different type of protection, in the form perhaps of higher wages in the public service.

Testing this hypothesis with ECAM II data shows that the poverty incidence would fall or rise by three percentage points. In fact, if for some reason the general price level were to fall by, say, five percent, some households would see their purchasing power increase. The distribution of this windfall among socioeconomic groups shows that 59,389 people in households headed by a public or formal private sector worker, and 70,287 in households where the head is not working or unemployed, would emerge from poverty, and poverty incidence would decline by 1.7 percent and 4.1 percent respectively. The latter category of households derive their income essentially from the extended family network: indeed, 8 to 10 disabled people are cared for by relatives. Retirees constitute a potentially vulnerable category because of their age. On the other hand, with inflation of five percent, for 266,636 people living in households where the head is a farmworker, the minimal needs satisfaction threshold will now be out of their reach, and they will fall below the poverty threshold, with an increase of 3.6 percent in the incidence of poverty.

Table 9:

Variation in poverty incidence following a 5% change in the poverty threshold

Source: DSCN/ECAM II

Table 9:

Variation in poverty incidence following a 5% change in the poverty threshold

	Reduction of 5%		Increase of 5%
	Number affected	Incidence (%)	Number affected	Incidence (%)
Public/formal private sector workers	59,389	1.7	83,439	2.4
Farmers	262,148	3.5	266,636	3.6
Informal workers	87,007	3.1	88,225	3.1
Not working/unemployed	70,287	4.1	46,190	2.7
Total	478,831	3.1	484,490	3.1

Source: DSCN/ECAM II

View Table

Table 9:

Variation in poverty incidence following a 5% change in the poverty threshold

	Reduction of 5%		Increase of 5%
	Number affected	Incidence (%)	Number affected	Incidence (%)
Public/formal private sector workers	59,389	1.7	83,439	2.4
Farmers	262,148	3.5	266,636	3.6
Informal workers	87,007	3.1	88,225	3.1
Not working/unemployed	70,287	4.1	46,190	2.7
Total	478,831	3.1	484,490	3.1

Source: DSCN/ECAM II

2.2.5 The determinants of poverty

135. Analyses using ECAM II data have identified the principal determinants of poverty, which include education level of the household head, socioeconomic group, and place of residence. Thus, it appears that households where the head has little education are the most vulnerable. The incidence of poverty among households where the head has some higher education is 4.1 percent, compared with 42.5 percent for those where the head has no education.

136. The socioeconomic category of the household head also has a considerable influence on family living standards. Household heads working in the formal private or public sectors have less chance of being poor, to the extent that they enjoy an adequate degree of social protection. Other groups (farmers, informal workers, those not working or unemployed) are more exposed. Farmers run the greatest risk of poverty: they are three times more likely to be poor than are families where the head works in the public or formal private sector.

137. Finally, rural residence seems to be a risk factor. The poorest families live in the countryside. Yet it is important to note that here the environment has some influence on family living standards: apart from geographic conditions, which are assumed to be exogenous, the lack of infrastructure, and in particular the isolation of towns and villages, makes life difficult for the families living in them. The distance to the nearest paved road has in fact been identified as a source of family impoverishment.

2.3.1 The main stages of the participatory process for preparing the PRSP

140. The participatory process for preparing the national poverty reduction strategy⁷ was launched in January 2000 at ECAM, during a seminar-workshop that brought together representatives of public and parapublic administrations, universities, NGOs, religious organizations and donors. This seminar allowed for an initial exchange of views on the determinants of poverty in Cameroon, and on the main components of a strategy for reducing that scourge. At the same time, it sparked deeper thinking about the methodology for organizing participatory consultations at the grassroots level.

141. From March 31 to April 10, 2000, an initial round of participatory consultations took place in all 58 departments of the country, involving 203 target groups representing the various components of civil society, as well as individual activists. In total, nearly 10,000 people, 40 percent of whom were women, expressed their views during these consultations. Discussions were completely open, and were conducted in the presence of observers from the IMF, the World Bank, and the German cooperation agency GTZ. These consultations produced a mass of highly interesting and useful information about the way poverty is viewed at the grassroots level, the way people analyze the causes of poverty, and their proposed solutions for reducing it. The results of this first phase of participatory consultations were presented during a national workshop in May 2000, which brought together representatives of civil society, and in particular those of the groups consulted. This workshop identified the key themes that should be developed in the Interim Poverty Reduction Strategy Paper (I-PRSP). That paper was presented in October 2000 during a seminar that reinforced the contribution of the private sector and civil society to preparing the PRSP, and laid the basis for those key players to participate in subsequent monitoring and evaluation of the strategy during its implementation.

142. In January 2002, the second round of participatory consultations took place in all 58 departments of Cameroon, involving about 6000 individuals from different social categories. Those consultations allowed people, in particular the poor, (i) to supplement, refine and prioritize the major elements of the regional poverty profile as they emerged from the participatory consultations of March and April 2000, (ii) to learn about poverty reduction activities and strategies planned under the HIPC initiative, (iii) to make suggestions for improving the interim PRSP, and to put forward ideas for poverty reduction projects, and (iv) to discuss the initial ideas on the configuration and operation of the National Poverty Reduction Network. In April 2002, the results of the second round of participatory consultations were presented at a national feedback seminar.

143. From June 26 to July 7, 2002, a working retreat was organized at Limbé for drafting the full PRSP. This work was performed by a multidisciplinary team consisting of national experts and advisers from the public administrations concerned, as well as experts from civil society. The elements emerging from that work were compiled by the Technical Monitoring Committee for Economic Programs (CTS) and finalized during a second retreat at Kribi, from November 28 to December 3, 2002. Between December 6 and 10, 2002, the government transmitted the draft PRSP resulting from the Kribi retreat to civil society representatives, private sector economic operators, donors and governments, requesting their observations or suggestions for improving the paper. Responses were numerous, and most of the proposals received were taken into account, in order to improve the document and ensure a high-quality PRSP.

144. From December 16 to 19, 2002, a public workshop was held to formulate input by civil society to the draft PRSP. At that workshop, participants had the opportunity to: (i) understand the process of preparing and implementing the PRSP, (ii) examine the role and place of civil society in implementing the interim PRSP, (iii) determine a strategy for presenting the contributions of that workshop to other members of civil society, to the government and to donors, and (iv) prepare a strategy for involving civil society as a partner in implementing the PRSP. On December 27, 2002, a seminar was held to allow civil society organizations and private sector operators to exchange views. At that seminar, the main players in poverty reduction provided comments on the draft PRSP, with a view to making last-minute improvements to it before its submission to the Executive Boards of the World Bank and the International Monetary Fund. On March 14, 2003, the paper was presented to the donor community.

2.3.2 How people perceive poverty

145. The participatory consultations provided a better appreciation of how people perceive poverty in their daily lives (see annex 2.2). As with the quantitative assessment, income-related elements are seen as the most important characteristics of poverty in Cameroon. As people put it, “being poor means not having the money to satisfy basic needs”, in particular for food, housing, health care and education.

146. Other dimensions of poverty emerging from the quantitative approach (education, health, roads, drinking water etc.) are also clearly perceived by the public, according to the results from the participatory consultations. People recognize that, even with adequate incomes, the lack of essential services can keep them poor: “Poverty means trouble in getting safe drinking water, electricity, staple products, it means lack of roads and means of communication”; “poverty is when schools are far away, and when the schools offer no real teaching”; “a poor person is one who is in bad health and has trouble finding medical care”.

147. Social dysfunctioning is also seen as a characteristic of poverty. This term covers a number of failures, not necessarily related to financial capacity. As people put it, poverty is characterized by the collapse of morals (delinquency, prostitution, etc.), the loss of self-esteem and of social standing. Poverty also means living with insecurity, crime and unsanitary conditions. It means the inability to seek justice, to enforce rights, and to avoid everyday abuses.

2.3.3 How people see the determinants of poverty

148. The participatory consultations helped to identify the “factors” of poverty as seen by poor people themselves. The isolation that some regions suffer through the lack of highways and rural roads was mentioned by the great majority of people consulted as one of the major causes of poverty. This isolation makes it impossible for people in these regions to get their produce to market or to obtain provisions at reasonable cost. More generally, this concern goes hand-in-hand with the problem of access to basic infrastructure.

149. People also complained about the deregulation of many farm products and the lack of adequate policies to support farmers, as further factors for impoverishment. With no support or extension services, farmers have suffered negative fallout from restructuring, in the form of higher prices for inputs and low prices for their produce, in the absence of credit or advances to producers, and great price volatility. People have a feeling that deregulation was not sufficiently thought out, and that it should not imply the total elimination of state support for farmers and rural economy.

150. Bad governance is also cited as a factor for impoverishment. People pointed in particular to corruption, the diversion of public funds, impunity, exorbitant charges for public services, and the failure to decentralize, as factors contributing to the unfair distribution of the fruits of growth and to the persistence of poverty in Cameroon.

151. The fact that some regions of the country are poorly served by communication infrastructure is also seen as a cause of poverty. People there have a feeling that they are cut off from the rest of the country and from the flow of information from the outside world. The inadequacy of social infrastructure and facilities in education and health, and understaffing in those sectors, particularly in rural areas, are seen as a constraint on people’s self-fulfillment.

152. Environmental problems specific to certain regions, such as drought, water problems and migratory birds, were also cited as factors of poverty. As well, problems of land title and access, conflicts between farmers and herders, the lack of administrative and economic support, particularly in the forest, coastal and frontier areas, were also commonly evoked as factors of poverty.

153. Social dysfunctioning, which is seen first of all as a characteristic of poverty, is also cited as a factor of poverty. This term covers a number of failures, not necessarily of a material nature. It involves the collapse of moral traditions, the loss of self-esteem, the decline of family or community solidarity, the lack of public spirit and the resurgence of tribalism and sectarianism, the prevalence of prejudices against social groups with different cultures and ways of life. Insecurity in the face of full-scale banditry and petty crime, HIV/AIDS, early marriage and premature motherhood, and polygamy are also cited as factors contributing to poverty.

2.3.4 How people would tackle poverty

154. People proposed a number of solutions for reducing poverty.⁸ Those solutions rely essentially on strategies for generating incomes and improving living standards. Thus, people want the government to continue providing rural extension services and financing for modernizing techniques in farming, fishing and cottage industries, to promote research into the diversification and processing of farming and livestock products, to create processing and conservation facilities so that farm products can be safely taken to market in the major centers in short, to take all the steps necessary to improve living standards in the countryside and stem the rural exodus. Next, they propose adopting an industrial development strategy for mining and forest resources which will promote the creation of processing units that could become real poles of development and attraction for new businesses in many parts of the country. Finally, the proposed solutions extend to rural water and electrification programs, intensifying electrical grids by building micro-dams, and development of sources of drinking water throughout the country.

155. In the education and health sectors, the principal recommendations deal with the equipment, construction and rehabilitation of school and health facilities. People want to see more and better personnel resources devoted to education and health, the construction of new universities attuned to local realities, the reform of school and university curricula to match them with employment opportunities, stressing civics and moral issues as much as technical aspects. Finally, they are asking for greater national solidarity in combating contagious diseases, better care for HIV/AIDS victims, a stepped-up campaign against HIV/AIDS, malaria, meningitis and viral hepatitis, and supplying health centers with generic drugs that are affordable to all segments of the population.

156. Transportation and communication infrastructure features prominently in people’s demands. They want isolation to be broken down in every region, through the rehabilitation and maintenance of the existing road network, the paving of major national and interprovincial highways, the expansion and upkeep of rural roads so that farmers can get their output to market, nationwide coverage for communication systems, particularly in the frontier area (radio, television, telephone and other means), and the promotion of information and communication technologies (ICTs).

157. Many recommendations dealt with governance. People proposed restoring government authority, proceeding further with decentralization in the management of public affairs, stepping up the campaign against corruption, reinstituting civics education in school curricula, and strengthening the ability of the police forces to combat insecurity and enforce the law for all.

2.3.5 Monitoring and assessment mechanisms favored during the consultations

158. The January 2002 consultations provided the opportunity not only to present people with a list of indicators for monitoring poverty reduction policies and activities, but also to share with them the ideas for instituting a National Poverty Reduction Network for the exchange of information on poverty. People welcomed this initiative.

159. They also proposed that (i) the network should have a pyramidal structure, with the village, commune or city district (arrondissement) at the base, (ii) information should be circulated using existing local transmission methods, reinforced by modern communication techniques, and (iii) awareness, information, education and communication strategies should be targeted at the poor in order to explain to them the rationale for the National Poverty Reduction Network and how it will work.

2.4.1 Education, training and poverty reduction

161. Overall trends portray a mixed picture for the situation and progress of the education sector. There has been a slight improvement, represented by an increase of about 2.5 percentage points in the overall net enrollment rate between 1995/1996 and 2000/2001 (76.3 percent to 78.8 percent). This trend is consistent with that of the literacy rate, which has gained 6.4 percentage points over the same period (61.5 to 67.9 percent). More encouraging is the fact that the enrollment rate for girls has risen faster than that for boys, recording a significant catch-up of 1.1 percentage point and confirming that Cameroon has been successful in reducing gender disparities and offering economic opportunity.

162. The enrollment profile measures the effective coverage of each level of schooling, on the basis of school attendance and the completion rate. In 2001, the rate of access to primary school stood at 95 percent, which is close to the target of 100 percent access to the first year of primary school (SIL/CII), and represents an increase of 5 percentage points over the year 2000. On the other hand, the completion rate for primary school is still low (56 percent), which means that of every 100 new entrants into primary school, only 56 reach CM2 (the sustainable literacy threshold). In fact, the dropout rate in the first two years (SIL and CP) of primary school is very high. There is a sharp decline in the access rate into secondary school: the transition rate from CM2 to grade 6 is about 60 percent, which means, roughly, that only two out of three new entrants into CM2 will go on to the sixth year of general education. The completion rate for the first cycle of secondary school in 2000/2001 was 67 percent.

Table 10:

Key indicators in primary education (%)

Source: MINEDUC⁹

Table 10:

Key indicators in primary education (%)

	2000	2001
Access rate	90	95
Completion rate	43	56
Repetition rate	27	25

Source: MINEDUC⁹

View Table

Table 10:

Key indicators in primary education (%)

	2000	2001
Access rate	90	95
Completion rate	43	56
Repetition rate	27	25

Source: MINEDUC⁹

163. The quality of the education system. Educational quality is measured not only by academic results but also by learning conditions and the student-teacher ratio. The quality indicators show a deterioration in both these areas. The success rate for the CEPE/FLSC, the examination marking the end of primary school, was 72 percent in 2001. The repetition rate remains high 25 percent, 21 percent and 31 percent in primary school, the first cycle of secondary, and the second cycle of secondary, respectively. The ratio of pupils to classrooms is 52, ranging from 38 in the South Province to 74 in the Extreme North.

• Teachers. The student-teacher ratio in primary education was 63 during the school year 2000/2001. It ranged from 37 in the South Province to 77 in the Extreme North. Nearly one-half of the secondary school teaching body is underqualified, because of shortcomings either in initial training or in continuous professional development. Moreover, the education supervision system is weak (lack of training for supervisors, too few supervisors, little mobility for supervisors because of logistic constraints, etc.) and does little to improve the situation. To all this must be added a general lack of morale among teachers, because of discrepancies in their status (some enjoy tenure, while others are on temporary contract and are paid much less) and poor working conditions, particularly in the larger cities (where class sizes sometimes reach 100 pupils).

• Shortages of textbooks and teaching materials. Teachers and students alike suffer from a shortage of essential textbooks: with the exception of French and mathematics (for which seven students out of 10, and five students out of 10, respectively, have the required textbooks), the textbook possession rate for other subjects is only three students in 10. As for the teachers, the shortage of teaching texts is even more glaring: only one teacher in two has a French teaching guide, 3 in 10 have the mathematics guide, and one in 10 has the science guide.

• The lack of basic facilities (drinking water, electricity, toilets) and specialized classrooms in most schools is a further handicap.

• Health conditions are also of concern (there is no effective school health policy: no infirmary, no basic medications, etc.), and are made worse by the HIV/AIDS epidemic in the schools.

164. Poverty and level of education. The foregoing analysis suggests that education conditions for the population as a whole are a cause of concern. Analyses of the poverty profile show that schooling conditions for the poor are even more alarming. These results confirm that there is a significant link between schooling and poverty in Cameroon. In fact, the net enrollment rate is 8.8 percentage points lower for children ages 6 to 14 living in poor families, compared to those in nonpoor families (74.1 percent versus 82.9 percent in 2001). This discrepancy may reflect the fact that poor people do not have sufficient income to cover school expenses, and/or that access is more difficult for poor children than for the nonpoor, or in “regions” that are poor in relation to others. Moreover, education spending is five times higher among nonpoor families than among poor families (68,001 CFA francs versus 15,973 CFA francs, on average, in 2001): it accounts for 4.2 percent of poor family budgets, and 5.6 percent for nonpoor families. The difference in the enrollment rate is thus in large part a reflection of monetary poverty, but it also betrays inter-regional differences in capacities and hence in access.

Table 11:

Net enrollment rate and education expenditure

Source: MINEPAT/DSCN: ECAM I and II Reports

Table 11:

Net enrollment rate and education expenditure

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Net enrollment rate (%)
Poor	74,1	78,1	77,2	82,6	72,3	74,1
Nonpoor	87,0	67,7	74,9	93,2	75,0	82,9
Total	81,0	74,5	76,3	90,5	73,5	78,8
Average education expenditure (CFAF)
Poor	23269	14876	17314	27545	13525	15973
Nonpoor	61650	28110	47655	86614	38513	68001
Total	46787	19069	30692	79780	24810	48046
Share of education spending (%)
Poor	5,8	4,2	4,8	6,6	3,6	4,2
Nonpoor	4,8	2,4	3,9	6,7	3,7	5,6
Total	5,0	3,1	4,1	6,7	3,7	5,4

Source: MINEPAT/DSCN: ECAM I and II Reports

View Table

Table 11:

Net enrollment rate and education expenditure

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Net enrollment rate (%)
Poor	74,1	78,1	77,2	82,6	72,3	74,1
Nonpoor	87,0	67,7	74,9	93,2	75,0	82,9
Total	81,0	74,5	76,3	90,5	73,5	78,8
Average education expenditure (CFAF)
Poor	23269	14876	17314	27545	13525	15973
Nonpoor	61650	28110	47655	86614	38513	68001
Total	46787	19069	30692	79780	24810	48046
Share of education spending (%)
Poor	5,8	4,2	4,8	6,6	3,6	4,2
Nonpoor	4,8	2,4	3,9	6,7	3,7	5,6
Total	5,0	3,1	4,1	6,7	3,7	5,4

Source: MINEPAT/DSCN: ECAM I and II Reports

2.4.2 Health and poverty reduction

165. General conditions. As with education, health is an important element not only for the quality of life but also for the productivity of the country’s human resources. The principal health indicators deteriorated between 1991 and 1990. During that time, the infant mortality rate rose sharply by about 12 points, the chronic malnutrition rate for infants ages 12 to 23 months rose from 23 percent to 29 percent, and the rate of professionally assisted childbirth declined by 5 percentage points. Nevertheless, the vaccination rate (DTP3) improved by nearly 20 percentage points between 2001 and 2002, rising from 43 to 63 percent.

Table 12:

Selected public health indicators

Source: MINEPAT/DSCN; EDS 1991 and 1998; Health Sector Strategy

Table 12:

Selected public health indicators

Health indicators	1991	1998	Change	2001
Infant mortality rate (per 1000)	65	77	−12
Chronic malnutrition rate (%)	23	29	−6
Rate of low birth weight (%)	16	22	−6
Maternal mortality rate (per 100 000 live births)	430	430	0
Assisted childbirth rate (%)	63.8	58.2
Vaccination rate (DTP3 in %)	34	48	+14	43
Utilization rate of public health facilities (%)	30
HIV/AIDS prevalence rate (%)	2	7.2	−5.2	11.8

Source: MINEPAT/DSCN; EDS 1991 and 1998; Health Sector Strategy

View Table

Table 12:

Selected public health indicators

Health indicators	1991	1998	Change	2001
Infant mortality rate (per 1000)	65	77	−12
Chronic malnutrition rate (%)	23	29	−6
Rate of low birth weight (%)	16	22	−6
Maternal mortality rate (per 100 000 live births)	430	430	0
Assisted childbirth rate (%)	63.8	58.2
Vaccination rate (DTP3 in %)	34	48	+14	43
Utilization rate of public health facilities (%)	30
HIV/AIDS prevalence rate (%)	2	7.2	−5.2	11.8

Source: MINEPAT/DSCN; EDS 1991 and 1998; Health Sector Strategy

166. Indicators of the availability of health services show that much remains to be done in terms of training and recruiting medical and paramedical personnel, and in constructing and equipping health centers. For example, the per capita ratios of physicians, nurses, hospital beds, health centers and pharmacies shown in the above table indicate important shortfalls in comparison with WHO recommendations. In 2001, the human resource deficit was estimated at some 9000 persons. Moreover, health personnel are unevenly distributed throughout the country, there is little in the way of human resource planning, and working conditions mean that productivity is low. When it comes to infrastructure and equipment, much of the health system is outdated, facilities are unevenly distributed among the provinces, as well as between urban and rural areas, technical support centers are obsolete, and there is no proper management accounting system for health infrastructure and facilities. Finally, real maintenance expenditure is less than 2.5 percent of what is needed.

Table 13:

Service availability indicators

Source: EDS 1991 and 1992; Health Sector Strategy

Table 13:

Service availability indicators

Doctors/10.000	1
Nurses/3.000	1.3
Beds/1000	1.3
Health Centres/10.000	1.2
Pharmacies/100.000	1.6

Source: EDS 1991 and 1992; Health Sector Strategy

View Table

Table 13:

Service availability indicators

Doctors/10.000	1
Nurses/3.000	1.3
Beds/1000	1.3
Health Centres/10.000	1.2
Pharmacies/100.000	1.6

Source: EDS 1991 and 1992; Health Sector Strategy

167. Public health spending in recent years has fallen far short of needs. For the year 2002, the health sector’s needs were estimated at CFAF 320 billion, or 5 percent of GDP, while the health budget represented only 1.1 percent of GDP. Consequently, households continue to bear most of the burden of health costs: direct payment for services accounts for 76 percent of total financing, compared to 18.5 percent from the government, and 5.5 percent from external financing.

168. The epidemiological profile of Cameroon, like that in most countries of sub-Saharan Africa, is dominated by infectious and parasitic diseases. There is also a rising trend in the prevalence of certain pathologies such as hypertension, diabetes and cancer. Infectious diseases such as AIDS, malaria and tuberculosis account for a particularly high share of general morbidity. Health statistics show that malaria alone is responsible for 40 to 50 percent of medical consultations, 40 percent of deaths among children under five years, and 23 percent of hospitalizations, and it consumes about 40 percent of annual family health budgets. As well, there has been a resurgence of diseases that were once on the verge of disappearance, such as tuberculosis (22,000 new cases on average each year), often found in combination with the rising incidence of HIV/AIDS (30 percent of tuberculosis victims are also seropositive). Finally, the HIV/AIDS prevalence rate has risen alarmingly in Cameroon, from 0.5 percent in 1987 to 2 percent in 1992, and 11.8 percent in 2002, placing Cameroon number 11 among the countries most affected by this pandemic.

169. Health and poverty in Cameroon. Apart from these overall trends, an analysis of the poverty profile shows significant differences between the poor and nonpoor in terms of their state of health and their access to care. Most people still turn to formal health services in case of illness. Among those who declared themselves ill in 2001, 3/4 were able to seek consultation at a formal health center, versus 1/4 in informal facilities. Formal health centers are more frequently visited by the nonpoor, and informal facilities by the poor.¹⁰

Table 14:

Consultation and immunization rates and health expenditures

Source: DSCN: ECAM I and II Reports

Table 14:

Consultation and immunization rates and health expenditures

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Consultation rate in formal facilities (%)
Poor	72.2	65.0	67.8	74.0	69.0	70.0
Nonpoor	87.5	86.2	87.0	83.8	75.3	79.1
Total	82.6	75.6	79.2	81.7	72.2	75.5
Consultation rate in informal facilities (%)
Poor	28.0	35.0	32.2	25.9	31	30.0
Nonpoor	12.5	13.8	13.0	16.2	24.7	20.9
Total	17.4	24.4	20.8	18.3	27.8	24.5
Immunization rate for infants 12 to 23 months (%)
Poor	68.1	66.9	67.2	53.1	46.5	47.1
Nonpoor	89.5	27.2	57.9	70.2	54.5	61.2
Total	80.3	53.4	63.3	67.0	50.3	55.3
Average health expenditure in CFA francs
Poor	7342	5562	6044	8934	6671	6937
Nonpoor	26035	15130	19903	45687	19825	32178
Total	18301	9423	12521	39116	12922	22036
Household budget share of health expenditure (%)
Poor	6.8	7.5	7.3	6.5	8.6	8.5
Nonpoor	6.6	8.2	7.2	6.2	6.7	6.5
Total	6.6	8.0	7.2	6.2	7.9	7.6
Average distance to nearest health center (km)
Poor				1.32	5.74	5.12
Nonpoor				1.10	4.96	3.31
Total				1.13	5.26	3.86

Source: DSCN: ECAM I and II Reports

View Table

Table 14:

Consultation and immunization rates and health expenditures

	1996			2001
	Urban	Rural	Total	Urban	Rural	Total
Consultation rate in formal facilities (%)
Poor	72.2	65.0	67.8	74.0	69.0	70.0
Nonpoor	87.5	86.2	87.0	83.8	75.3	79.1
Total	82.6	75.6	79.2	81.7	72.2	75.5
Consultation rate in informal facilities (%)
Poor	28.0	35.0	32.2	25.9	31	30.0
Nonpoor	12.5	13.8	13.0	16.2	24.7	20.9
Total	17.4	24.4	20.8	18.3	27.8	24.5
Immunization rate for infants 12 to 23 months (%)
Poor	68.1	66.9	67.2	53.1	46.5	47.1
Nonpoor	89.5	27.2	57.9	70.2	54.5	61.2
Total	80.3	53.4	63.3	67.0	50.3	55.3
Average health expenditure in CFA francs
Poor	7342	5562	6044	8934	6671	6937
Nonpoor	26035	15130	19903	45687	19825	32178
Total	18301	9423	12521	39116	12922	22036
Household budget share of health expenditure (%)
Poor	6.8	7.5	7.3	6.5	8.6	8.5
Nonpoor	6.6	8.2	7.2	6.2	6.7	6.5
Total	6.6	8.0	7.2	6.2	7.9	7.6
Average distance to nearest health center (km)
Poor				1.32	5.74	5.12
Nonpoor				1.10	4.96	3.31
Total				1.13	5.26	3.86

Source: DSCN: ECAM I and II Reports

170. The vaccination rate for nonpoor children is better than that for poor children, and children are better protected in the cities than in the countryside. In 2001, slightly more than half (55.3 percent) of infants between 12 and 23 months received the complete EPI vaccination dose (source: ECAM). According to the Ministry of Health, that rate is 43 percent.

171. The cost of health services rose nearly three times as fast as the average inflation rate over the last five years, by some 70 percent (from 13,000 CFA francs to 22,000 CFA francs), and it is apparent that financial capacity has a considerable impact on the demand for health services. Annual average health spending per capita is three times higher in urban than in rural areas (39,000 CFA francs vs. 13,000 CFA francs), and four times as high among the nonpoor as among the poor (32,000 CFA francs vs. 6,900 CFA francs).

172. According to regional health map data, 54 percent of people live less than five kilometers from an integrated health center. This average figure, however, conceals wide regional disparities, ranging from 43 percent in the province of Adamaoua to 78 percent in the province of Littoral. Moreover, the ECAM II report notes that rural people must travel five times as far as urban dwellers to reach the nearest health facility. Even more strikingly, 98.9 percent of people who must travel more than six kilometers to a health facility live in the countryside, indicating the serious problem of rural health care access.

2.4.3 Basic infrastructure services

173. As with health and education, safe drinking water and transportation and energy services, etc., are among the amenities of life. Infrastructure services also affect households’ capacity to reach markets and to participate in economic activity.

Table 15:

Access to drinking water, electricity and other basic infrastructure

Source: MINEPAT/DSCN: ECAM I and II Reports

Table 15:

Access to drinking water, electricity and other basic infrastructure

	1996		2001
	Urban.	Rural.	Urban.	Rural.
Drinking water (%)
Poor	56.6	22.4	71.5	28.2
Nonpoor	81.0	28.4	88.3	33.4
Total	73.6	25.5	86.2	31.3
Electricity (%)
Poor	61.4	9.6	68.2	14.9
Nonpoor	82.9	13.6	91.0	29.0
Total	76.3	11.7	88.2	23.4
Time to nearest paved road (minutes)
Poor			8.4	75.1
Nonpoor			6.0	62.0
Total			6.3	67.1
Fixed telephone (%)
Poor			6.2	0.4
Nonpoor			51.6	2.5
Total			46	1.6

Source: MINEPAT/DSCN: ECAM I and II Reports

View Table

Table 15:

Access to drinking water, electricity and other basic infrastructure

	1996		2001
	Urban.	Rural.	Urban.	Rural.
Drinking water (%)
Poor	56.6	22.4	71.5	28.2
Nonpoor	81.0	28.4	88.3	33.4
Total	73.6	25.5	86.2	31.3
Electricity (%)
Poor	61.4	9.6	68.2	14.9
Nonpoor	82.9	13.6	91.0	29.0
Total	76.3	11.7	88.2	23.4
Time to nearest paved road (minutes)
Poor			8.4	75.1
Nonpoor			6.0	62.0
Total			6.3	67.1
Fixed telephone (%)
Poor			6.2	0.4
Nonpoor			51.6	2.5
Total			46	1.6

Source: MINEPAT/DSCN: ECAM I and II Reports

174. Access to safe drinking water and energy. For the population as a whole, potable water consumption rose substantially over the period. One household in two had access to safe drinking water in 2001, compared to only one in five in 1996. Similarly, nearly half of Cameroonian households (46 percent) make use of electric lighting.

175. Yet there are considerable discrepancies, both between urban and rural areas, and between poor and nonpoor households. For example, urban accessibility rates are three times as high as rural rates, both for water and for electricity. On the other hand, these gaps are insignificant as between poor people and the nonpoor, reflecting the “public” nature of these services: when they are available at all in a region or locality, they are accessible to the poor as well as to the nonpoor, consistent with the government’s “social” approach to policy in these sectors.¹¹

176. Road access. An essential element of the quality of life, and of people’s ability to insert themselves in the economy, is the availability of properly maintained roads for transporting persons and goods. Isolation raises transaction costs and is a factor for poverty. Cameroon has a relatively dense network of interurban roads spanning some 50,000 kilometers, 53 percent of which are classed as the primary or trunk network. Of this network, 16 percent is paved, nearly 40 percent consists of dirt roads, and 45 percent is non-engineered rural tracks. Traffic counts for the year 2001 show that paved roads and dirt roads together carried about 90 percent of traffic (62 percent and 27 percent). Data also show that nearly 80 percent of paved roads, 73 percent of dirt roads, and 70 percent of rural tracks are in the bad or mediocre condition.

Table 16:

Traffic volumes and status of the road network in Cameroon

Source: CP/DR, Oct. 2002 and Jan. 2003¹².

Table 16:

Traffic volumes and status of the road network in Cameroon

Characteristics		2000				2001
		Paved	Dirt	Rural	Total	Paved	Dirt	Rural	Total
	in km	3 993	9 892	12 110	25 972	4 090	9 929	12 110	26 129
Length	as% of network	15	38	47	100	16	38	46	100
	Standard	44	17	24	/	21	27	29	/
Condition	Mediocre	36	68	0	/	37	70	6	/
	Bad	20	15	76	/	42	3	65	/
Volume of traffic	in Veh.km	3 878 120	1 273 694	520 730	5 672 544	4 029 428	1 726 157	702 308	6 457 965
	As%	68	22	10	100	62	27	11	100

Source: CP/DR, Oct. 2002 and Jan. 2003¹².

View Table

Table 16:

Traffic volumes and status of the road network in Cameroon

Characteristics		2000				2001
		Paved	Dirt	Rural	Total	Paved	Dirt	Rural	Total
	in km	3 993	9 892	12 110	25 972	4 090	9 929	12 110	26 129
Length	as% of network	15	38	47	100	16	38	46	100
	Standard	44	17	24	/	21	27	29	/
Condition	Mediocre	36	68	0	/	37	70	6	/
	Bad	20	15	76	/	42	3	65	/
Volume of traffic	in Veh.km	3 878 120	1 273 694	520 730	5 672 544	4 029 428	1 726 157	702 308	6 457 965
	As%	68	22	10	100	62	27	11	100

Source: CP/DR, Oct. 2002 and Jan. 2003¹².

177. The limited extent of the paved network, and the poor state of the road system as a whole, pose a major obstacle for people in general, and for the poor in particular, in gaining access to basic services. The results of the ECAM show, in fact, that for people living in the countryside it takes on average an hour to reach a paved road, and that for the poor it takes longer than for the nonpoor.

178. An important lesson for formulating the strategy can be drawn from this analysis. Access to infrastructure services in Cameroon is much less satisfactory for rural than for urban dwellers. This factor may well be widening the economic gap between the cities and the countryside, which is home to half the country’s total population, and more than two-thirds of its poor. The situation is explained in part by the fact that it is costly to provide infrastructure services to sparsely settled areas. It also reflects the relative weakness of rural people’s influence on the budgetary process and of their ability to attract public spending on their behalf. Particular attention must therefore be paid to this situation when it comes to decentralizing public services, to ensure that some zones are not overlooked in favor of others, which would have the effect of fragmenting both the economy and society, and would constitute a major stumbling block to any effort to reduce poverty and inequality.

3.3.1 Rural sector: a key sector for economic growth

193. Cameroon’s economy continues to be dominated by the rural sector through its contribution to growth as well as its large poverty reduction potential. According to projections, about half of the country’s population lives in rural areas and is employed in agricultural, pastoral, or forestry activities. The poverty profile shows that Cameroon’s poverty is primarily rural.

194. During the 1970s and 1980s, rural sector performance was very weak given the vast potential of the sector. Hence, Cameroon has continued to import cereals to meet the needs of its population. Between 1971 and 1998, imports increased by a factor of 10 from 32,100 metric tons to 348,148 metric tons. Imports per capita increased from 7.2 kg to 24 kg during the same period, while cereal production per capita declined from 157 kg to 85 kg. The deterioration of the productive environment (changes in ecosystems, declining soil fertility, etc.) has threatened the relevance of the current production system. Similarly, the sector is facing cross-sector constraints, particularly a lack of rural infrastructure, inadequate dissemination of economic information, as well as reduced productive capacity. During the last decade, the supply response in agriculture has generally been unable to respond to market signals or meet the needs of rural households.

195. The government’s integrated rural development strategy will be implemented through several programs highlighting five priority areas: (i) local development; (ii) production development; (iii) institutional support; (iv) sustainable management of natural resources; and (v) financing mechanisms available to the rural sector. The government will also integrate into its rural development strategy cross-sector policies and actions related to land management reform and capacity building.

196. The strategy with regard to the local development priority will endeavor to: (i) strengthen community and commune ability to address local development issues; (ii) support infrastructure construction and the removal of specific constraints at the local level; (iii) develop income-generating activities; and (iv) ensure the active participation of local stakeholders in developing their communities through progressive decentralization. The National Participatory Development Program (PNDP), the Community Development Support Program (PADC), and the RUMPI project constitute the prime operational frameworks.

197. The production development component will focus on: (i) supporting farming development and a better integration of production activities (crop, livestock, and agroforestry production); (ii) developing high-potential subsectors; (iii) promoting the emergence and development of professional and interprofessional organizations; (iv) supporting applied research and demand-driven extension services so as to alleviate priority production and farming constraints; and (v) agricultural product processing.

198. Institutional support and renovation of vocational and professional training will help those in the rural sector flourish in their new environment. Key measures will involve building capacity, allowing: (i) administration to focus on key public functions and provide essential services (training, information, statistics, etc.); (ii) economic operators to improve their competitiveness; and (iii) professional organizations to improve their negotiation capacity and to become valid decision-makers in designing and implementing the strategy.

199. Sustainable natural resource management will be achieved through the forestry/environment sector program, which is the key operational framework (see paragraph 3.3.1.3).

200. Rural sector financing includes two subcomponents. The first (the National Microfinance Program) aims at improving the rural population’s access to microfinance institutions and at strengthening the capacity of these institutions. The second plans to implement mechanisms relating to medium and long-term financing for farmers and agriculture-based business investments.

3.3.1.1 Agriculture

201. Following the construction of major roads to the Eastern and Southern provinces, marketing prospects for starch crops, cereals, fruits, and vegetables appear good in the short and medium term, particularly for plantain, potatoes, onions, and cassava. The support of household farming will be provided by the development of agricultural activities in urban areas. The goal is to foster the emergence of intensive, land-saving, and highly efficient production systems, to provide adequate supplies of local products to urban areas, particularly in fruits and vegetables. Such intensive production systems would offer employment opportunities to a large number of people, currently underutilized, and would therefore increase production.

202. Starch crops. The government’s policy is to increase the consumption of fresh and processed food in order to reduce food imports and improve national food security. The main strategic objectives are to: (i) improve farm productivity (enhancing the use of quality seeds and technology through extension services); (ii) market starch crops (stabilize urban supply and pricing); and (iii) promote export- or processing-oriented SMEs/SMIs. A special cassava program will be established because of the product’s social and economic importance (a third of cassava production is processed). In addition to meeting the requirements for fresh and processed products, the program will take into account subregional demands and national industry requirements for animal food, as well as starch production (see Annex 3.1 for more details on the cassava subsector).

203. Cereals. The national cereal policy aims, among other things, to: (i) consolidate cereal production in current production systems so as to increase food security and raise farmers’ incomes; and (ii) promote production, particularly in areas where competitiveness in domestic and subregional markets is good (see Annex 3.1 for more details on corn, millet, and sorghum production).

Box 11.

The Marketing Cost of Agricultural Products: Food Crops

• Issues

The marketing of food crops incurs many costs (transportation, handling, warehousing, losses). Beyond a certain level, a cost increase would reduce availability and hurt the crop’s competitiveness, even if it enjoys a comparative advantage. Therefore, controlling cost is imperative to improving the consumers’ as well as the producers’ welfare.

• Methodology

The cost of marketing food crops can be analyzed in terms of its percentage relationship to the total production cost and in terms of the gap between producer prices and retail prices. The gap illustrates the relative share of intermediaries and their profit margins in the marketing system.

• Results

Intermediaries’ margins constitute the single most important source of cost increase. Transportation is second. For some products, such as potatoes, the intermediaries’ profit margin is more than 100 percent of producer prices. Transport cost depends on the distance and the season (rainy or dry season). In theory, the cost per kilometer ranges between CFAF 202 on average for a small truck and CFAF 239 on average for a large truck. Estimates in the table below are based on dry season costs, except for potatoes. The destination market is Douala for plantain and Yaoundé for corn and potatoes.

The table above indicates that intermediaries (wholesalers, merchants, retailers, carriers) are the primary beneficiaries of food crop marketing. Better-organized producers could decrease the number of intermediaries, thereby increasing their incomes. Maintaining feeder roads is also another important factor.

Marketing cost for selected food crops
	Plantain	Corn	Potatoes
Marketing cost as % of total cost	31	44	43
Of which transport cost	10.2	10.1	19.5
(Sales price – producer price): producer price (in %)	140	104	200
Intermediaries’ margin in % of producer price	96	26	126

View Table

Marketing cost for selected food crops
	Plantain	Corn	Potatoes
Marketing cost as % of total cost	31	44	43
Of which transport cost	10.2	10.1	19.5
(Sales price – producer price): producer price (in %)	140	104	200
Intermediaries’ margin in % of producer price	96	26	126

Source: Study on improving the marketing and competitiveness of Cameroon’s agricultural products, Nicolas Gergely, April 2002.

204. The fruit and vegetable subsector holds promise in terms of production and export diversification. Subsector measures include: (i) making better use of domestic and subregional urban markets; and (ii) designing, initiating, and implementing specific development support programs for priority subsectors, such as pineapple, plantain, potatoes, gum Arabic, and onion. Emphasis will be placed on (i) facilitating trade in and exports of fresh products by opening up landlocked production areas; (ii) supporting the organization of wholesale marketing in primary harvesting areas, major trade centers, and border markets; and (iii) improving packaging structures (see Annex 3.1 on potatoes).

Box 12.

Comparative Advantages of Agricultural Subsectors

• Issues

The agricultural sector contributes about 40 percent of GDP, represents 21 percent of total exports, and employs a large share of the population. Agricultural competitiveness and growth potential are central issues in the poverty reduction strategy. Which subsectors with comparative advantages would benefit from the implementation of supporting measures to increase production and achieve sustainable growth?

• Methodology

A microeconomic study on agriculture subsector competitiveness has shed some light on this question. The study focused on Cameroon’s key marketed products, including basic food crops: plantain, cassava, corn, and potatoes, poultry from the animal subsectors, and cocoa and coffee. The study calculated the economic return of the production in each subsector. The economic return is seen as a comparative advantage indicator (the domestic resource cost coefficient or “DRC”). Assuming all national production is either exportable or can replace imports to generate or save foreign exchange, DRC measures the cost of gaining or saving foreign exchange through domestic production. When the cost is less than the international prices, the DRC is less than one and the national economy enjoys a comparative advantage.

• Results

The figures in the following table show encouraging prospects for most of Cameroon’s agricultural subsectors. In general, regarding food crops, activities are economically profitable with the exception of intensive or semi-intensive aviculture with the purchase of provender. Simple arithmetic has been used to estimate the average DRC for each subsector. DRCs have been calculated for two or three geographical areas, but because of a lack of data, it has not been estimated for cassava and potatoes: the Ebolowa area (extensive model), the Southwest (semi-intensive model), and Mbam and Lékié (intensive model). Concerning Arabica coffee, an extensive model whereby coffee is intercropped with food crop cultivation, and a semi-intensive model have been used to evaluate subsector performance. The cultivation model for Robusta is typically semi-intensive. Available data have made it possible to calculate the DRC for each subsector as well as the equilibrium producer price. The results show that, while cocoa/coffee subsector activities are economically profitable given that all the DRCs are less than one, in contrast the financial return shows tremendous variation in international prices.

Note: With respect to aviculture: (1) denotes intensive or semi-intensive aviculture, including the production of provender; (2) denotes intensive or semi-intensive aviculture with purchase of provender; (3) denotes traditional aviculture; (4) denotes improved traditional aviculture; and (5) denotes intensive egg production.

Competitiveness of selected basic food crops
Product	Plantain	Corn			Aviculture
			1	2	3	4	5
DRC	0.58	0.50	0.65	1.1	0.95	0.8	0.70
Marketing cost in % of total cost	39	51	-	-	-	-	-
Competitiveness of selected export crops
Product	Cocoa				Coffee
					Robusta	Arabica
	Ebolowa	Southwest	Mbam-Lékié			1	2
DRC	0.2	0.2	0.2		0.9	0.6	0.4
Producer price at equilibrium/kg	202	227	296		199	423	331

Note: With respect to aviculture: (1) denotes intensive or semi-intensive aviculture, including the production of provender; (2) denotes intensive or semi-intensive aviculture with purchase of provender; (3) denotes traditional aviculture; (4) denotes improved traditional aviculture; and (5) denotes intensive egg production.

View Table

Competitiveness of selected basic food crops
Product	Plantain	Corn			Aviculture
			1	2	3	4	5
DRC	0.58	0.50	0.65	1.1	0.95	0.8	0.70
Marketing cost in % of total cost	39	51	-	-	-	-	-
Competitiveness of selected export crops
Product	Cocoa				Coffee
					Robusta	Arabica
	Ebolowa	Southwest	Mbam-Lékié			1	2
DRC	0.2	0.2	0.2		0.9	0.6	0.4
Producer price at equilibrium/kg	202	227	296		199	423	331

Note: With respect to aviculture: (1) denotes intensive or semi-intensive aviculture, including the production of provender; (2) denotes intensive or semi-intensive aviculture with purchase of provender; (3) denotes traditional aviculture; (4) denotes improved traditional aviculture; and (5) denotes intensive egg production.

• Implications for the rural development strategy

High marketing costs, as mentioned in the preceding box, weigh down highly perishable food crops, resulting in lower producer prices. Improving producer incomes will depend on creating appropriate feeder roads, promoting producer organizations, and improving information. These are the major supports for the sector in the rural strategy and the PRSP.

Source: Study on improving the marketing and competitiveness of Cameroon’s agricultural products, Nicolas Gergely, April 2002.

205. Traditional export crops will still play a major role in the economy of rural areas. For subsectors such as cotton, coffee and cocoa, and palm oil, where family farming plays an important role, key recommendations include:

• Strengthening the capacity of producer organizations to improve production operations, marketing, and bringing products up to market standards;

• Improving subsector economic performance in order to increase producer incomes and improve the ratio of competitiveness/cost for major domestic and external markets (see box);

• Consolidating production systems while maintaining their diversity in order to better manage market-related risks. This includes support for producer initiative, as has been done for palm oil in low altitude forest areas, corn in the cotton producing area and central savanna, and fresh vegetables and tubers in most regions.

206. Other promising subsectors. The preliminary results from the sources of growth study highlighted Cameroon’s natural propensity for the development of new, promising growth subsectors, such as pepper, horticulture, watermelon, and organic farming. Development prospects for such activities exist in forest areas of the Littoral and Southwest provinces, and in the highland area of the West and Northwest provinces. Additionally, these areas are close to Douala, the main entry and exit port of the country, which is an important asset for export opportunities.

3.3.2 Industrialization to enhance and stabilize growth

226. Until the crisis of the mid-1980s, the industrial sector had evolved into an environment protected by tariff and nontariff barriers, resulting in excessive manufacturing costs. The high cost of power, transportation, and telecommunications, the inadequate infrastructure, and the low productivity of human resources have considerably reduced the competitiveness of Cameroon’s industry, despite tariff barriers or quotas, compared to products of its competitors or imported substitutes. The adjustment measures, such as the progressive liberalization of trade and of product as well as input prices have failed to trigger automatic adjustment in the industrial sector. The protectionist measures benefiting these industries in the past have not favored the development of a globally competitive industrial and technological base.

227. The government gives top priority to the industrial sector, which it regards as the key source of poverty reducing growth in the medium term. The public sector has the ambition of minimum annual growth of 6 to 7 percent, possibly reducing poverty by 50 percent by 2015. This objective can be achieved only with an increased contribution to the national product from industry and services. Furthermore, industrial development will have important spillover effects on agriculture and services, investment and high value-added exports. Moreover, it would offer outsourcing opportunities to the SME/SMI sectors, favoring the development of interindustry links as well as greater integration of the industrial network. Beyond the direct effect of creating jobs and generating revenues, spillover effects on agriculture and services would also contribute to improving the incomes of the poor.

228. Cameroon has some competitive advantages in the manufacturing industry: (i) the privileged geographical position of the country in the Gulf of Guinea, given a potential market of 200 million consumers in Central Africa, including Nigeria; (ii) the availability of a wide range of raw materials and skilled manpower; and (iii) the potential for developing core physical infrastructures (hydropower potential, road network, telecommunications, urban development), as well as financial, human, and institutional resources and making them available to manufacturing industry.

229. Yet the industrial sector’s performance remains well below its potential, as it is, like the other productive sectors, constrained by the lack of an appropriate transportation, power, and telecommunications infrastructure, etc. These constraints are analyzed in detail in the private sector section. More specifically, structural weaknesses also restrain the development of Cameroon’s industry and reduce its role in the economy. These weaknesses include: (i) the lack of a selective support policy globally promoting the manufacturing capacities of high potential subsectors in areas such as product design and development, the development of appropriate skills, technological expertise, export promotion, outsourcing to SMEs, access to financing, etc.; and (ii) weak vertical integration, with most inputs for the industrial sector, such as raw materials, intermediate products, and professional services (maintenance, advisory services, etc.) being imported.

230. The government is aware of these weaknesses and of the industrial potential of the sector. In the short term, it plans to engage in support activities, supplementing the private sector in order to improve the rate of investment in the industrial sector and strengthen the growth and competitiveness of manufacturing industry in order to: (i) diversify industrial production; (ii) increase manufacturing value-added; and (iii) increase the share of manufacturing exports, including nontraditional exports, in the total.

231. These actions include physical infrastructure development, institution building, and the implementation of policies supporting industry. First, the focus will be on providing selective direct support to competitive subsectors with high growth potential, taking into account opportunities in the national, regional, and global markets. Preliminary findings in early studies on the industrial subsector indicate that Cameroon could have a comparative advantage in agroindustry, textiles, and wood processing (see box below and Annex 3.3). Other activities include the strengthening of cross-sector services essential to industrial development, or sectors that could have a stimulus effect on industry. These sectors involve the production of key inputs for industrial subsectors or sectors that have a positive impact on the demand for industrial products. These are primarily sectors such as power (electricity and petroleum), transportation, financial intermediation, information and communications technologies, tourism, education, vocational and professional training, housing, and construction and public works.

232. The government is particularly committed to investing in the large-scale infrastructure needed for industrial development, including: (i) rehabilitation of the Wouri bridge, rehabilitation of the Douala and Yaoundé urban infrastructure, and construction of a bridge on the Mayo-Tsanaga; (ii) building infrastructure links between Cameroon, Gabon, Equatorial Guinea, the Central African Republic, Chad, and Nigeria; (iii) building a second bridge over the Wouri; and (iv) constructing a beltway highway around Douala with a connecting link to Limbe, where the harbor is expected to be developed as part of the ongoing redeployment of Cameroon’s industrial shipyard.

233. Cameroon’s industrial competitiveness depends upon a physical infrastructure and an institutional framework that should provide specialized services in the areas of standardization and quality control, promote exports and investment, create linkages between research institutions, training institutions and productive enterprises, and foster information dissemination and cross-industry relations. Experience in East and South East Asian countries has stressed the importance of combining physical and institutional infrastructures to strengthen industrial capacities. The government can also be an important driving force when working with private support organizations to foster development. The overall objective is to create an enabling environment for direct foreign and domestic investment. A well-functioning infrastructure will help reduce transaction costs while having a positive impact on the competitiveness of industrial enterprises and private investments in Cameroon’s manufacturing sector.

234. The government plans to develop an industrial redeployment strategy and will take the following actions:

• Carry out an in-depth diagnostic study of the industrial sector: analyze opportunities, strengths, and weaknesses in order to identify and select competitive, high-growth sectors or subsectors, such as agrobusinesses, wood, aviculture, etc., or sectors with strongly positive externalities, such as construction and public works, energy, tourism, information and communications technologies (ICT), etc. The selection criteria will include export potential, the capacity to add value in manufacturing, technological expertise, the availability of critical factors, etc.;

• Prepare selective strategies to strengthen the competitiveness of the subsectors chosen, including specific incentive measures;

• Analyze export promotion activities for subsectors catering to international markets, modernize export-oriented business in these subsectors, develop partnerships through professional meetings and investment forums, and finally, promote trade;

• Formulate a strategy to strengthen infrastructures that support industry (power, transportation, ICT, etc.), including the preparation and implementation of a powerful master plan, monitor the implementation of the transport sector master plan, prepare and implement an ICT master plan, and introduce the New Information and Communication Technologies Agency (ANTIC);

• Draft policy measures to promote local industrial outsourcing, including such activities as the creation of an outsourcing exchange, the development of industrial partnership arrangements through company visits, sector-focused professional meetings, bilateral partnerships, and the dissemination of information on business opportunities and public procurement;

• Conduct a diagnostic study of the industrial sector, support intermediary organizations, and devise specific strategies to develop their capacity;

• Study the creation of business clusters, consortiums, or networks to improve access to markets, input factors (raw materials, intermediate inputs, technology, etc.), and support services (training, marketing, technology, business opportunities, etc.);

• Evaluate the impact of privatization on the industrial sector by promoting and developing cross-industry relationships, outsourcing to local SMEs/SMIs, etc.;

• Improve research and development activities by creating a consultation framework for research institutes (such as IRAD and CIRAD), universities and other higher-education professional institutions, and businesses;

• Conduct out a human resource development study for the industrial sector.

235. The preliminary conclusions of the industrial subsector study conducted as part of the sources of growth study stress the importance of cluster development in the textile/garment industry, aviculture industries, tertiary wood processing sector, and tropical fruit processing sector. Annex 3.3 contains an analysis of these subsectors.

Box 15.

The Comparative Advantage of Industrial Subsectors

• Issues

Because of the decline of the oil sector, growth recovery and poverty reduction will require the redeployment of the non-oil industry and high value-added services. Much as in the case of agriculture, the main issue is to identify subsectors with growth potential and in which Cameroon has a comparative advantage. This relates to the broader question of the competitiveness of Cameroon’s economy and each of its sectors.

• Methodology

As for the agricultural subsectors, the competitiveness of these industrial subsectors is determined by the Domestic Resource Cost coefficient (DRC). Subsector competitiveness has been rated according to their DRC. The DRC measures, in terms of real resources, the opportunity cost of producing or saving foreign exchange. It is calculated by dividing the economic value of domestic resource inputs by the international economic value-added. (i) Values of DRC below 1 indicate an efficient use of resources. At this level, the cost of the foreign exchange earned or saved through domestic production is less than the international cost. (ii) Keeping in mind the effect of dynamic links and the fact that some subsectors that are noncompetitive in the short term could become competitive in the medium term with appropriate cross-sector policies, a second group of potentially competitive subsectors has been identified. These subsectors have DRC values ranging from 1 to 1.5. (iii) Subsectors with a DRC value of over 1.5 are considered noncompetitive. Negative DRCs indicate a very inefficient use of resources, corresponding to situations where free trade value-added is negative.

• Outcome and lessons for a strategy

The identification of competitive manufacturing subsectors in Cameroon is based on a sample of 44 companies, contributing about 85 percent of the non-oil industrial value-added. (i) Using the above classification, the most promising growth sector (group 1) includes the wood, wood processing, and beverage industries. The wood and wood processing industries merit the authorities’ attention in the context of an industrial policy. (ii) Improving the competitiveness of agribusiness, chemical industries, and the rubber, textile, and steel industries should help boost industrial exports. These are potentially competitive subsectors in the medium term. Combined, groups 1 and 2 contribute about three-quarters of the value-added (76 percent) and account for over half of all manufacturing employment (58 percent). (iii) Finally, the cigarette and other manufacturing industries appear very costly and without a promising future. These results give selected and well-targeted support for an industrial redeployment strategy.

Cameroon – Competitiveness of Industrial Subsectors, 1997–2000

^*= Negative free trade value-added.

Source: Study on subsector competitiveness, Arsène Nkama, 2000.

Sectors	Average DRC 1997-2000	% industrial value-added, 1994-2000	% industrial employment in 2000	Net exports (in millions of CFA francs in 2000
1. Competitive subsectors Wood Beverages	0.97 0.88	11.66 16.49		60,117 -42,251
2. Marginally competitive subsectors Textiles Food products Rubber Chemicals Building materials Steel industry	1.30 1.45 1.28 1.47 1.41 1.16	10.13 2.94 12.05 4.42 6.06 12.73	5.25 0.66 35.89 1.78 0.82 1.75	53,396 4,283 49,171 -12,635 -10,469 68,680
3. Costly subsectors Cigarette manufacturing Other manufacturing industries	2.8 1.56	2.33 1.45	0.73 0.52	1,072 1,723
4. Very costly subsectors Mechanical appliances	*	1.37	0.55	-3,581

^*= Negative free trade value-added.

Source: Study on subsector competitiveness, Arsène Nkama, 2000.

View Table

Sectors	Average DRC 1997-2000	% industrial value-added, 1994-2000	% industrial employment in 2000	Net exports (in millions of CFA francs in 2000
1. Competitive subsectors Wood Beverages	0.97 0.88	11.66 16.49		60,117 -42,251
2. Marginally competitive subsectors Textiles Food products Rubber Chemicals Building materials Steel industry	1.30 1.45 1.28 1.47 1.41 1.16	10.13 2.94 12.05 4.42 6.06 12.73	5.25 0.66 35.89 1.78 0.82 1.75	53,396 4,283 49,171 -12,635 -10,469 68,680
3. Costly subsectors Cigarette manufacturing Other manufacturing industries	2.8 1.56	2.33 1.45	0.73 0.52	1,072 1,723
4. Very costly subsectors Mechanical appliances	*	1.37	0.55	-3,581

^*= Negative free trade value-added.

Source: Study on subsector competitiveness, Arsène Nkama, 2000.