Business

22, January 2023

Manyu: Oil and gas show up in Mamfe ⁰

It has been going on as rumor, but as the government has been reluctant to conduct any prospection in Manyu Division, oil and gas have begun showing up in parts of Mamfe and Besongabang.

Baku, a small river in Banya quarters of Mamfe town, has begun delivering the secrets which have been hiding for centuries in Manyu’s sub-soil.

All over the town, rivers are bearing oily films and the smell of gas is all over the town of Mamfe. Samples of the oil have already been sent to SONARA for testing and if confirmed, then Manyu Division is sitting on one of Africa’s largest oil reserves.

The same signs of a massive oil deposit in Manyu have also shown up in Ossing where the BADI river is mimicking what has just been happening in Baku in Mamfe town. It is suspected that Kembong, the division’s second largest town, might be holding massive oil and gas reserves.

The populations of Banya, Besongabang Ntenako, Nchang and Ossing might have to be displaced for the oil to be drilled and if this were to happen, then the government will end up with a massive job on its hands.

The government of Cameroon has never been transparent with the management of the country’s resources and, Indian Division which accounts for most of the country’s oil deposit, is one of the most underdeveloped areas of the country, with many of the Division’s children not even going to school.

The oil deposits in Manyu Division will have to be managed differently as the fighting in the two English-speaking regions of the country is also based on the government’s poor management of natural resources in the two regions.

Manyu’s sub-soil might just be one of those blessings which might end up as a curse. The fighting that has left the government with a bloodshot eye might intensify in the days ahead if government does not come up with a clear plan on how to engage the Anglophone Diaspora and the Ambazonian fighters who are not in any mood to abandon their objective of obtaining total independence for Southern Cameroons.

The international community has already been informed about the oil deposits in Mamfe and venture capitalists are already packing their bags to find out if the oil and gas are in commercial quantities.

Manyu’s economic and financial destiny is bound to change with the discovery of these oil and gas deposits. Manyu has many oil and gas experts, and their services will be solicited to ensure the people of this region benefit from their blessing.

By Soter Tarh Agbaw-Ebai with correspondent reports

20, January 2023

Factors that will continue to shape the Cameroonian remittance market in 2023 ⁰

In the last decade, the cross-border remittance market has undergone tremendous changes evolving from traditional offerings to much faster, easier and safer payment methods, thanks to digital disruptors.

With the rise of globalization and migration, followed by the demand for cross-border payments solutions, fintech organizations’ have changed the landscape by developing digitally enabled solutions for their consumers.

The shift is positively impacting the financial industry and improving the lives of millions of people in Sub-Saharan Africa. In the first-half 2022, remittance inflows in Cameroon, via WorldRemit, totaled £75 million GBP, boosted by the rapid need for digital remittances worldwide following the COVID-19 pandemic.

In 2023, it is projected the remittance industry will continue to evolve with innovation in the fintech sector at a quick pace. This will take place amidst an increasingly challenging economic environment with a continued increase in the cost of living and inflation across the globe.

With these factors in mind, remittance expert Imane Charioui, Director of Francophone Africa and Middle East, WorldRemit, shares some insights on what to expect in the Cameroonian remittance market in 2023.

Cashless transactions and mobile money

Mobile technology is a global game changer for remittances because it removes the need for costly brick-and-mortar branches. In Cameroon, digital infrastructure has evolved considerably with mobile acting as a key enabler and the primary channel for connectivity. For instance, the mobile population coverage rate for 2G is 96%, 85% for 3G and 53% for 4G.

In 2020 the Bank of Central African States (BEAC) revealed that Cameroon alone held 64.8% of all active accounts of The Economic and Monetary Community of Central Africa (CEMAC). This accounted for almost three times the number of mobile money accounts held by the Congolese (7.1 million) and almost ten times the number of accounts held by the Gabonese (2.7 million).

Additionally, Cameroon also confirmed its leadership over CEMAC’s electronic payment market by recording the highest number of transactions at 73.13%.

The increased public engagement with technology, and uptake of digital tools, are positive steps for Cameroon’s growing digital economy and the future of its fintech ecosystem in 2023.

Increased use of Money Transfer Operators (MTOs)

As online money transfer tools become more and more a part of people’s lifestyles, online money transfers will continue to grow steadily in 2023. However, the likelihood of further adverse international developments persisting into 2023 is high and the pace of remittance flows to Sub-Saharan Africa may ease to 3.9% from the 16.4% advance of 2021.

This is due to the economic outlook dimming and real wages expected to contract in the United States, and Europe where higher inflation is expected to impact areas that Cameroonian migrants reside. However, food affordability and the deterioration of real incomes across African states still indicate the need for financial support from diaspora.

As such, MTOs such as WorldRemit will continue to provide essential services to many Cameroonian families in need. ”At WorldRemit, 90 percent of money transferred to Cameroon is sent within minutes. This eliminates long wait times and complexities of traditional remittance processes. The recipients secure their money through WorldRemit’s suite of options designed for different services such as via trusted banks, mobile money, and cash pick-up locations,” said Imane.

MTOs will continue to help communities in different countries connect with their loved ones through financial support. Remittances are the backbone of many developing nations’ economies, and MTOs will keep playing their part in increasing the remittance flow.

Distributed by African Media Agency (AMA) for WorldRemit

17, January 2023

Biya regime cuts diamond and gold export duties by 50% to control illegal exits ⁰

The Cameroonian government, in its 2023 Finance Act, announced it is cutting diamond and gold export duties by 50%. The fees will now be 5% of the FOB value of the ore to be shipped, instead of 10%.

“We have noted that since this exit tax was raised to 10%, spontaneous export declarations have virtually disappeared (although these ores continue to be exported from Cameroon, ed). The few revenues that Customs has been able to collect are the result of seizures from traffickers,” says an authorized source in the Customs Department. This means that, instead of providing more customs revenue to the Treasury, the increase in the export tax on diamonds and gold a few years ago has had the opposite effect in Cameroon. Indeed, mining operators and other buyers have developed informal export channels to avoid paying the tax. The new reduction in the exit tax is a way for the government to encourage the return to formal exports.

Gold and diamonds produced in Cameroon are highly prized by traffickers. According to official statistics, despite the creation of a mechanism to promote formal export channels, notably through Capam and more recently Sonamines, only about 10% of national gold production is sold in formal channels. The rest goes through informal channels, sometimes with the complicity of the producing companies.

The same phenomenon is observed in diamond production and marketing. For example, according to the Kimberley Process National Permanent Secretariat, Cameroon exported 654 carats of diamonds in 2019. However, the actual production was way more than that since a significant volume went through informal ways, the organization said.

As evidence, while 654 carats were exported, the Kimberley Process National Permanent Secretariat reveals that it was able to trace, throughout 2019, a little over 1,595 carats of diamond production.

Source: Business in Cameroon

11, January 2023

World Bank: Sharp, Long-lasting Slowdown to Hit Developing Countries Hard ⁰

Global growth is slowing sharply in the face of elevated inflation, higher interest rates, reduced investment, and disruptions caused by Russia’s invasion of Ukraine, according to the World Bank’s latest Global Economic Prospects report.

Given fragile economic conditions, any new adverse development—such as higher-than-expected inflation, abrupt rises in interest rates to contain it, a resurgence of the COVID-19 pandemic, or escalating geopolitical tensions—could push the global economy into recession. This would mark the first time in more than 80 years that two global recessions have occurred within the same decade.

The global economy is projected to grow by 1.7% in 2023 and 2.7% in 2024. The sharp downturn in growth is expected to be widespread, with forecasts in 2023 revised down for 95% of advanced economies and nearly 70% of emerging market and developing economies.

Over the next two years, per-capita income growth in emerging market and developing economies is projected to average 2.8%—a full percentage point lower than the 2010-2019 average. In Sub-Saharan Africa—which accounts for about 60% of the world’s extreme poor—growth in per capita income over 2023-24 is expected to average just 1.2%, a rate that could cause poverty rates to rise, not fall.

“The crisis facing development is intensifying as the global growth outlook deteriorates,” said World Bank Group President David Malpass. “Emerging and developing countries are facing a multi-year period of slow growth driven by heavy debt burdens and weak investment as global capital is absorbed by advanced economies faced with extremely high government debt levels and rising interest rates. Weakness in growth and business investment will compound the already-devastating reversals in education, health, poverty, and infrastructure and the increasing demands from climate change.”

Growth in advanced economies is projected to slow from 2.5% in 2022 to 0.5% in 2023. Over the past two decades, slowdowns of this scale have foreshadowed a global recession. In the United States, growth is forecast to fall to 0.5% in 2023—1.9 percentage points below previous forecasts and the weakest performance outside of official recessions since 1970. In 2023, euro-area growth is expected at zero percent—a downward revision of 1.9 percentage points. In China, growth is projected at 4.3% in 2023—0.9 percentage point below previous forecasts.

Excluding China, growth in emerging market and developing economies is expected to decelerate from 3.8% in 2022 to 2.7% in 2023, reflecting significantly weaker external demand compounded by high inflation, currency depreciation, tighter financing conditions, and other domestic headwinds.

By the end of 2024, GDP levels in emerging and developing economies will be roughly 6% below levels expected before the pandemic. Although global inflation is expected to moderate, it will remain above pre-pandemic levels.

The report offers the first comprehensive assessment of the medium-term outlook for investment growth in emerging market and developing economies. Over the 2022-2024 period, gross investment in these economies is likely to grow by about 3.5% on average—less than half the rate that prevailed in the previous two decades. The report lays out a menu of options for policy makers to accelerate investment growth.

“Subdued investment is a serious concern because it is associated with weak productivity and trade and dampens overall economic prospects. Without strong and sustained investment growth, it is simply impossible to make meaningful progress in achieving broader development and climate-related goals,” said Ayhan Kose, Director of the World Bank’s Prospects Group. “National policies to boost investment growth need to be tailored to country circumstances but they always start with establishing sound fiscal and monetary policy frameworks and undertaking comprehensive reforms in the investment climate.”

The report also sheds light on the dilemma of 37 small states—countries with a population of 1.5 million or less. These states suffered a sharper COVID-19 recession and a much weaker rebound than other economies, partly because of prolonged disruptions to tourism. In 2020, economic output in small states fell by more than 11%— seven times the decline in other emerging and developing economies. The report finds that small states often experience disaster-related losses that average roughly 5% of GDP per year. This creates severe obstacles to economic development.

Policymakers in small states can improve long-term growth prospects by bolstering resilience to climate change, fostering effective economic diversification, and improving government efficiency. The report calls upon the global community to assist small states by maintaining the flow of official assistance to support climate-change adaptation and help restore debt sustainability.

10, January 2023

CDC calls on plantation workers to return to Southern Cameroons ⁰

Cameroon’s second largest employer, the state-run Cameroon Development Corporation (CDC), is calling for thousands of plantation workers who fled the country’s separatist conflict to return to work. About half the company’s 20,000 workers left more than four years ago over unpaid wages and after deadly and brutal attacks. The company last week said it was safe to return, but workers are skeptical and say it should first rebuild homes destroyed or damaged in the conflict.

The CDC said it wants thousands of workers back at banana, palm oil, and rubber plantations in the restive Southwest region. Managers of the state-run giant on Monday visited towns and villages in the region to meet with workers who fled unrest in 2018 and ask them to return.

Cameroon Agricultural and Allied Workers Trade Union President Gabriel Mbene Vefonge, who was part of the delegation, said the corporation has promised to pay back wages to those workers who return.

“Most of them are doing mean (menial) jobs in many areas of this country, so we are calling them to come back,” he said. “Their security is being guaranteed by the state and we have seen in the last six months there is relative calm. For those who had wounds, we think that their wounds are healed, and the CDC management is taking care of them. Our members should come back to work.”

Cameroon’s military says it has chased the rebels from the plantations, which armed groups used for training camps.

In 2018, the rebels ordered workers to leave the plantations and warned that those who refused would be attacked.

Authorities say the armed groups chopped off fingers of scores of workers suspected of collaborating with the government and torched hundreds of homes, schools, and factories.

William Lekunja, a worker at a plantation in Meanja, said he escaped in 2018. He said he will only return if the company improves work and living conditions in villages damaged in the conflict.

“They cannot eat well because what they have is too meager,” he said. “Others who have gone there came back with testimonies. Their hospitals bills are paid by themselves, there is no good housing for them, no good water for them.”

Cameroon’s government says some of the company’s former workers are owed more than two years’ back pay. The company has vowed to pay back wages but says the conflict and exodus of workers led to a massive drop in production and sales.

The government says sales and revenue increased after about 2,000 workers returned in 2021 and 2022.

CDC general manager Franklin Ngoni Njie said if the remaining 8,000 workers return, the company’s sales will return to previous levels.

He said they would then be able to afford paying back salaries and reconstructing destroyed buildings.

“The solution is getting back to work,” he said. “Working and making money, money to help pay wages. To pay those who are working, just salaries alone, costs the corporation about 900 million francs. It is difficult to get that amount of money, but that notwithstanding, we will try to do what must be done to continue to operate.”

Cameroon’s separatist conflict was sparked in 2016 when predominantly English-speaking western regions protested discrimination by the country’s French-speaking majority.

Cameroon’s military responded with a crackdown and rebels took up arms claiming to defend the English-speaking minority.

The U.N. says the conflict has since left 3,500 people dead and 750,000 displaced.

Source: VOA

21, December 2022

Ghana goes ‘bankrupt’ ⁰

The Ghanaian government has announced it can no longer honor its payment of external debts to creditors. Bondholders were shocked when the government announced it can no longer pay about 13 billion Euros in debt to its creditors.

The announcement was made by the country’s Finance ministry on Monday December 19, 2022.

Ghanaian Government says it’s a short term move intended to carry out IMF lead structural reforms but former Ghanaian President disagreed tweeting “Tragic! Ghana officially bankrupt”

Ghana was misled by France to lead an economy embargo against Mali’s military government when they chased the French away. Ghanaian government stopped all trade with Bamako and ended ties. The move prompted Burkina Faso government to recalled its ambassador from Accra further straining Ghana’s fragile economy

Ghanian government also led a West African campaign to oust Russia from the region, dismantling ties with Moscow on the behest of US and France.

Source: Freelancer

17, December 2022

Biya regime explores new avenues of cooperation with UAE investors ⁰

Investors from the United Arab Emirate and Cameroon gathered on Thursday in Dubai to explore ways of strengthening business relations, investment opportunities and discussing prospects on signing mutually-beneficial partnership agreements.

During the ‘Cameroon Investment Week’ Investment Forum, which took place at Jafza 1 Convention Center, Jebel Ali Free Zone, the two countries delve into viable business and investment opportunities.

To foster discussions, the event assembled major high-profile stakeholders including; Technical Advisor for Economic Affairs at the Presidency of the Republic of Cameroon: Jean Claude AYEM MOGER; Abdulla Al Saleh, Under Secretary of the Foreign Trade and Industry at the UAE Ministry of Economy; Iya Tidjan, Ambassador to the Cameroon Embassy in Kingdom of Saudi Arabia; and the General Manager of the Investment Promotion Agency Cameroon Mrs. Marthe Angéline MINJA.

The event was also be attended by several top CEOs, managers of local governmental and private economic entities as well as representatives of the Cameroonian business community.Abdulla Al Saleh said,” The volume of non-oil trade between the UAE and Cameroon reached $406 million in the first nine month of 2020 with a over 5 per cent increase compared to the same period of 2021.”

He added,” This forum is a perfect platform to explore the new avenues of cooperation between the two countries.”

The Investment Forum featured an interesting panel discussion about Cameroon’s Business environment and investment opportunities in strategic sectors like oil, port, aeronautics, electricity & decentralization.

During the event, institutions from the UAE and Cameroon signed a memorandum of understanding (MoU) to create an attractive environment for UAE companies willing to invest in Cameroon, encourage the exchange of trade missions, and facilitate information exchange between the parties. The Mou’s were signed between:

Investment Promotion Agency Cameroon & UAE International Investors Council, Investment Promotion Agency Cameroon & UAE Trade Centre, United Councils & Cities Cameroon & UAE Trade Centre, Miller & Associates and UAE Trade Center and Investment Promotion Agency Cameroon & XFusion.

Mrs. Marthe Angeline MINJA, General Manager of Investment Promotion Agency Cameroon, on this occasion said: “Cameroon, Africa in miniature, is not coming empty-handed to this give-and-take forum. Indeed, it has abundant assets, hence its attractiveness”

Walid Hareb AlFalahi, CEO of Dubai Consultancy & UAE Trade Center, expressed: “Cameroon is an emerging and ambitious economy, and it is evident that there is considerable scope to extend bilateral trade between UAE and Cameroon which would enable investment flows into priority sectors such as renewable energy, technology and logistics. UTC has been playing a key role in driving investment into key sectors in Africa and we are looking forward to play a key role in driving investment into Cameroon and further strengthen the relationship between UAE and Cameroon.”

The focus of this gathering was Foreign Direct Investments (FDI) attraction which are generally characterized by huge investment projects, high rate of job creation, a significant contribution to infrastructural development and transfer of technology, as well as their support to adding value to local resources. Thus, this event became a platform to ensure the attraction of sustainable FDIs in a bid to fast-track the achievement of Cameroon’s development goals.

In its 2022 investment report, the United Nations Conference on Trade and Development (UNCTAD) ranked the UAE as 17th country globally and first Arab country in the world in terms of FDI outflows that totaled $22.5 billion USD in 2021, reflecting a 19% growth compared to their 2020 records which clearly underlines the growing interest among UAE entities in investing in foreign markets and the positive effects that these entities experience from outward FDI. According to a 2021 report and survey commissioned by the Dubai Chamber of Commerce, sectors including fintech, agriculture, health tech and e-commerce display great potential in African markets, provided companies can access the necessary investments to address challenges such as weak digital infrastructure, limited public amenities and unfamiliar regulations. The same survey from Dubai Chamber found that among business leaders in Africa, fintech is expected to see the most growth in 2022 — of up to 89 per cent, followed by agriculture and food processing, by 89 and 87 per cent, respectively. These figures indicate Africa’s position as an attractive investment destination with the potential to generate higher returns on investment in the long term.

The Investment Forum therefore form a part of undertakings to ensure continuity of the UAE-Cameroon business relationship.

Source: Gulf Today

17, December 2022

BEAC puts into circulation new range of banknotes in Central Africa ⁰

In the six countries of the Economic Community of Central Africa (Cameroon, Congo, Gabon, Chad, CAR and Equatorial Guinea), the BEAC (Bank of Central African States) has put into circulation new banknotes from December 15.

On posters and banners announcing these new banknotes, the BEAC emphasizes that these are “more compact, more modern and better secured” banknotes that it has put into circulation.

“For the production of these bills, BEAC has used technology that puts it one step ahead of counterfeiters. These bills have modern security features that are difficult to forge,” Emmanuel Asafor Sho, BEAC’s deputy national director for Cameroon, told the agency on Thursday.

“It is a technology that has significantly improved the quality of cash circulation by gradually replacing the bills of the 2002 range, most often worn, by new bills of the 2020 range,” he added stressing that “to ensure the authenticity of a bill, it is sufficient to apply the method “TRI”, a simple, fast and effective method that combines three gestures: Touch, Look, Tilt.

This new range comes after the 2002 range, 20 years later. According to the Bank of Central African States, these new bills were put into circulation on December 15 in accordance with the decision taken on November 7 in Douala by the Ministerial Committee of the Central African Monetary Union (UMAC).

The BEAC had stressed in a press release last November that despite the introduction of new banknotes of the 2020 range, the 2002 range of banknotes continues to be in force in the Economic Community of Central Africa (Cemac).

Source: Africa News

7, December 2022

Debt-Service Payments Put Biggest Squeeze on Poor Countries Since 2000 ⁰

The poorest countries eligible to borrow from the World Bank’s International Development Association (IDA) now spend over a tenth of their export revenues to service their long-term public and publicly guaranteed external debt—the highest proportion since 2000, shortly after the Heavily Indebted Poor Countries (HIPC) initiative was established, the World Bank’s new International Debt Report shows.

The report highlights rising debt-related risks for all developing economies—low- as well as middle-income economies. At the end of 2021, the external debt of these economies totaled $9 trillion, more than double the amount a decade ago. During the same period, the total external debt of IDA countries, meanwhile, nearly tripled to $1 trillion. Rising interest rates and slowing global growth risk tipping a large number of countries into debt crises. About 60% of the poorest countries are already at high risk of debt distress or already in distress.

At the end of 2021, IDA-eligible countries’ debt-service payments on long-term public and publicly guaranteed external debt totaled $46.2 billion—equivalent to 10.3% of their exports of goods and services and 1.8% of their gross national income (GNI), according to the report. Those percentages were up significantly from 2010, when they stood at 3.2% and 0.7% respectively. In 2022, IDA countries’ debt-service payments on their public and publicly guaranteed debt are projected to rise by 35 percent to more than $62 billion, one of the highest annual increases of the past two decades. China is expected to account for 66% of the debt-service payments to be made by IDA countries on their official bilateral debt.

“The debt crisis facing developing countries has intensified,” said World Bank Group President David Malpass. “A comprehensive approach is needed to reduce debt, increase transparency, and facilitate swifter restructuring—so countries can focus on spending that supports growth and reduces poverty. Without it, many countries and their governments face a fiscal crisis and political instability, with millions of people falling into poverty.”

On the surface, debt indicators seem to have improved in 2021, the report shows. As economic growth resumed following the global recession in 2020, public and publicly guaranteed external debt as a share of GNI returned to pre-pandemic proportions. However, this was not the case for IDA countries, where the debt- to-GNI ratio remained above the pre-pandemic level at 25%. Moreover, the economic outlook has deteriorated considerably.

In 2022, global growth is slowing sharply. Amid one of the most internationally synchronous episodes of monetary and fiscal policy tightening the world has seen in 50 years, the risk of a global recession next year has been rising. Currency depreciations have made matters worse for many developing countries whose debt is denominated in U.S. dollars. The 2021 debt-to-GNI improvement, as a result, is likely temporary.

Over the past decade, the composition of debt owed by IDA countries has changed significantly. The share of external debt owed to private creditors has increased sharply. At the end of 2021, low- and middle-income economies owed 61% of their public and publicly guaranteed debt to private creditors—an increase of 15 percentage points from 2010. IDA-eligible countries owed 21% of their external debt to private creditors by the end of last year, a 16-point increase from 2010. Also, the share of debt owed to government creditors that don’t belong to the Paris Club (such as China, India, Saudi Arabia, United Arab Emirates, and others) has soared. At the end of 2021, China was the largest bilateral lender to IDA countries, accounting for 49% of their bilateral debt stock—up from 18% in 2010. These developments have made it much harder for countries facing debt distress to quickly restructure their debt.

The rising debt vulnerabilities underscore the urgent need to improve debt transparency and provide more complete debt information to strengthen countries’ ability to manage debt risks and use resources efficiently for sustainable development.

“Poor debt transparency is the reason so many countries sleepwalk into a debt crisis,” said Indermit Gill, Senior Vice President and Chief Economist of the World Bank Group. “Complete, transparent debt data improves debt management. It makes debt sustainability analyses more reliable. And it makes debt restructurings easier to implement, so that countries can return quickly to economic stability and growth. It is not in any creditor’s long-term interest to keep public debt hidden from the public.”

The new International Debt Report reflects an advance in debt transparency. It draws from the World Bank’s International Debt Statistics database—the most comprehensive source of comparable cross-country information on the external debt of low- and middle-income countries. It improves on the earlier International Debt Statistics reports by adding substantive analysis and expanding both the breadth and specificity of the data in it.

Over the past five years, the International Debt Statistics database has identified and added $631 billion of previously unreported loan commitments, and an additional $44 billion were identified in 2021. The total of these newly documented additional loan commitments over the past five years is equivalent to more than 17% of the total outstanding public and publicly guaranteed debt stock in 2021.

7, December 2022

Oil and Gas: Biya and Obiang set to seal shameful deal ⁰

A cross-border energy cooperation deal between Cameroon and Equatorial Guinea, which has been stalled for several years, is now set to go ahead and should boost Yaoundé and Malabo gas operations, Africa Intelligence reported.

Africa Intelligence also added that the deal would also benefit Marathon Oil and its Bioko liquefaction plant as well as Chevron, which operates in both countries.

However, the signing is coming at a time when Equatorial Guinea recently deported several hundred Cameroonians, some of whom say they were fleeing terrorist and rebel attacks at home.

The oil-rich country has a history of always targeting Cameroonian migrants who render services such as mechanics, electricians, and bricklayers including miners.

Innocent Cameroonian citizens have over the years been victims of what many political commentators have painted as Biya regime’s lack of interest in the plight of its citizens outside the country.

By Chi Prudence Asong