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- GDP (PPP):
- $47.3 billion
- 4.1% growth
- 3.0% 5-year compound annual growth
- $2,257 per capita
- Inflation (CPI):
- FDI Inflow:
Cameroon’s economic freedom score is 52.3, making its economy the 133rd freest in the 2013 Index. Its overall score is 0.5 point better than last year, reflecting notable gains in freedom from corruption and labor freedom. Cameroon is ranked 27th out of 46 countries in the Sub-Saharan Africa region, and its overall score is lower than the regional average.
The foundations of economic freedom are neither well established nor strongly protected in Cameroon. The judiciary is vulnerable to political interference and corruption, and the protection of property rights remains weak, undermining prospects for more significant and dynamic long-term economic development.
Economic performance is far below potential. Productive activity has become relatively diversified, with the services sector contributing about half of total domestic production, but the overall economic environment is dominated by the inefficient public sector. The risk of state interference in the private sector remains high in the country’s volatile political environment. Production and export of oil have declined, putting pressure on the government’s fiscal balance.
President Paul Biya has held office since 1982. In 2008, Biya’s supporters in parliament passed constitutional amendments granting the president immunity for acts committed while in office. In October 2011, Biya was re-elected with 78 percent of the vote in an election marred by numerous irregularities. Public frustration with poor governance has threatened to spark political unrest. Although the government claims to maintain strong civil-rights laws, charges of discrimination and abuse of human rights are abundant. In 2012, Cameroon tightened its border security with Nigeria as attacks by Boko Haram terrorists left 15 people dead along the border region. Cameroon’s economy, highly dependent on commodity exports and afflicted by serious mismanagement and an overvalued currency, has been seriously affected by the global economic slowdown.
Protection of property rights is weak due to pervasive corruption and an inefficient judicial system. The court system is vulnerable to political interference and long delays. Trademarks and copyrights are routinely violated, and software piracy is widespread. A former cabinet minister was charged in 2012 with embezzling millions in public funds and faces trial. His is the highest-profile indictment in an anti-corruption campaign launched in 2006.
The top income and corporate tax rates are 38.5 percent (35 percent plus a 10 percent surcharge). Other taxes include a value-added tax (VAT) and an inheritance tax. The overall tax burden equals 10.3 percent of GDP. Government spending is equivalent to 20.7 percent of total domestic output, and a budget deficit of 2.6 percent of GDP has pushed public debt to 12.9 percent of GDP.
The process for establishing a company has become more streamlined, but paid-in minimum capital required to launch a business equals almost twice the level of average annual income. The formal labor market is not fully developed. Inflation has been modest. The prime minister has proposed removing the fuel subsidy that has put the country’s fiscal balance under severe strain.
The trade-weighted average tariff rate is quite high at 15 percent, and non-tariff barriers further increase the cost of trade. The investment regime is constrained by heavy bureaucracy and a lack of transparency. New investments may be subject to government approval. The cost of financing is high, and short-term loans dominate lending. The non-banking financial sector remains small, with modest capitalization of the stock market.