A Critique of the Industrialization Component of Cameroon's Vision 2035

Abstract

This write-up is a critique of the Industrial Component of Cameroon’s Vision 2035. It opens up with a summary of the vision, closely followed by the provisions of the vision as regards industrialization. Industries and services as a component of sector objectives are detailly analyzed in follow up of the listed industrial provisions. The achievement of double-digit growth rates in production are also questioned. In conclusion, we might be tempted to say that Cameroon’s vision 2035 is an overextended and unrealizable plan, reading from current national economic, political, and social indicators.

List of Abbreviations

AU	African Union
CFA F	Franc of the Financial Community of Africa
FDI	Foreign Direct Investment
GDP	Gross Domestic Product
IBRD	International Bank for Reconstruction and Development
ICTs	Information and Communication Technologies
MDGs	Millennium Development Goals
MINEPAT	Ministry of Economy, Planning and Regional Development
MINESUP	Ministry of Higher Education
MINFI	Ministry of Finance
NEPAD	New Economic Partnership for Africa’s Development
OECD	Organization for Economic Cooperation and Development
PFI	Policy Framework for Investment
ROW	Rest Of the World
SMI	Small and Medium Industry

Summary of Cameroon’s Vision 2035

Cameroon’s long-term development vision by 2035 is stipulated as follows: Cameroon, an emerging, democratic and united country in diversity.

Emerging Country

As an emerging country, Cameroon should be in an era of sustainable economic, environmental, and social development with a strong, diversified and competitive economy. The manufacturing industry would be predominant (in the GDP and exports); its integration into the world economy; effective, poverty; minimal, disparities; eliminated, and the country ranked among middle-income countries resulting from its per capita income.

Democratic Country

Having attained the status of a democratic country, Cameroon’s institutions should be stable and there should be real separation of power. The  judiciary; independent, thanks  to  improved  legislation  adapted to local values  and  to  the  economic  context.  There would be the respect of collective and individual freedoms, with all segments of the population participating effectively.

Diversified but United Country

Cameroon as an emergent country will be non-discriminatory and national unity and integration existent. The country shall thrive with due respect for differences and identities. Values such as patriotism, merit, and respect for authority, peace, solidarity, integrity, hard work and pride will be measuring rods of individual and collective behaviors in an emergent Cameroon.  The functioning of society shall rest on consultation, dialogue, tolerance, mutual respect and recourse to mediation and justice, with the ultimate protection of persons and property.

Provisions of Vision 2035 As Regards Industrialization

Industrialization is one of the major pillars of the Vision’s Macro-economic objectives. There are eight macro-economic objectives in sum. The macro-economic objectives stated in the vision are: maintaining macroeconomic stability framework, increasing economic productivity, upgrading the processing sector (industrialization), promoting decent jobs, increasing the volume of investment considerably, collecting savings, financing growth and development, changing the structure of foreign exchange and expanding markets, and lastly, promoting changes and professionalization of services.

Upgrading the Processing Sector/Industrialization

This is the third macro-economic objective, ranked in order of importance. Effective recognition is given to the secondary sector of production (industries) as being a national growth catalyst. It is noted on a sad note that this sector of the economy is almost dead or absent.

Worth mentioning is the following claim made in the Vision, ‘Cameroon has succeeded in suppressing all obstacles to industrialization’. This claim is controversial as many obstacles to industrialization are yet to be overcome in the country.

Obstacles to Industrialization in Cameroon

According to The World Bank (also known as IBRD), 2013 statistics show that Cameroon has a population of 22.25 million inhabitants, a GDP of $29.27 million, a GDP growth rate of 5.5%, and an inflation rate of 1.9%.

Critique of the Claims regarding Industrialization

The claim made in the Vision 2035 that Cameroon has succeeded in overcoming/suppressing all obstacles to industrialization is a vague and controversial one indeed, as proven by the obstacles examined in the previous section.

Another overstated claim made by the vision is that ‘an industrial fabric has been established and is providing the whole economy with the production means for its growth, notably by promptly adding value to research results. In line with this statement, they continue as follows, ‘Now, that the option is to constantly consolidate the industrial fabric and ensure greater integration of various sectors of activity, the country henceforth has an economic base that can dampen all internal and external shocks easily.

Recommendations from Malaysia's Vision 2020 and New Economic Model/Plan (2009)

Malaysia’s GDP per capita is currently seven times as high as it was in 1980 in purchasing power terms, and has become one of the countries the most integrated into the global economy through trade (Stephen Thomsen, 2013). We all know that to deal substantially in trade like Malaysia does, you must produce, and to produce, you must have reliable industries.

We must strive to have an exported-oriented growth model in our preliminary phases of industrialization like Malaysia did in the 1980s. Foreign firms have had to play a major role in the process of growth and diversification. Also, foreign investment has been a key part of the outward-oriented development strategies of successive Malaysian governments. We must note that Malaysia has traditionally received significant amounts of foreign investment relative to the small size of its economy. Why can’t we put in place FDI-friendly environments in Cameroon?

Foreign investors are prominent in many sectors of the manufacturing sector, the electronics sector inclusive. This has been the driving force behind exports. Foreign investors represent 82% of the capital in Malaysia’s 2012 approved projects (Stephen Thomsen, 2013). Cameroon still has a lot to do as far as deregulation is concerned. The government has put in place so many tumbling blocks that disfavor investment, our economy is still overregulated.

Incentives could also be offered to investors willing to invest in industry, as is done in Malaysia. To this respect, the government could set up a commission that would exclusively be in charge of managing the incentives. Authorities in charge of investment attraction ought to periodically evaluate the relevance, appropriateness and economic benefits of the incentives relative to their costs, incorporating their long-term impact on resource allocation.

Cameroon, being a member of the OECD, should make optimal use of the OECD’s PFI and its User’s Toolkit. The PFI was created to foster a flexible, whole-of-government approach which recognizes that investment climate improvements require not just policy reform but also changes in the way governments go about their business.

Industries and Services As a Component of Sector Objectives

The sector objectives referred to in Cameroon’s Vision 2035 are: infrastructure, rural development, and industries and services.

Industries and Services

The main focus here is on industries, and not services, so the discussion shall be strictly delimited to industries. Cameroon’s industrial sector (as per the vision) is currently limited to a few industries namely:

• The processing of primary products,
• Finishing operations, and
• Small-scale processing.

Vision 2035's Provisions on Industries

The vision 2035 provides that as an emergent country, Cameroon’s industry will reflect the following: 

• Improved performance based on a largely endogenous technology,
• Diversified activities forming a network of intense internal changes,
• Stiff competition related to the special industry intensity of sectors according to their comparative competitiveness with the ROW.

Prerequisites for Industrial Development in Cameroon

It must be noted that certain prerequisites are needed for industries to bloom in the country. There must be an accompanied growth in energy resources to supply the power required for the industries to run effectively and efficiently. Also, the government must provide an enabling environment for businesses to operate with serenity.

In Malaysia for instance, Trade and Industry are run as a single ministry that is the Ministry of Trade and Industry. Cameroon could follow this example and link its ministries in charge of trade and industry. Trade and industry have a strong positive correlation. A growth in industry leads to a growth in trade, and who says globalization of trade says trade surplus, foreign exchange, and national development.

Cameroon should develop an investment framework that supports green growth. Regulatory and policy framework should be implemented for investment in priority areas for green growth, such as industries.

A lot of infrastructural development has to be undertaken in the country in order that the country’s industrial sector grows to successful levels. Infrastructure like electricity, transport, and water are of primordial interest.

Double-digit Growth Rates in Production

Section 2.5.1 of Cameroon’s Vision 2035 discusses the achievement of two-digit growth rates in the following areas:

• Economic growth,
• Production sector structure,
• Investment and technological development,
• Agricultural mechanization, and 
• Foreign trade sector structure.

Double-digit Growth Rate in The Production Sector

The vision states, ‘The performance of the manufacturing sector is expected to record an unprecedented growth from the current 10% to 23% of the GDP. Although the primary sector will continue to grow thanks to substantial productivity, gains from mechanization and intensified activities, its contribution will decrease from 44% to 15% due to the boom noticed in the secondary sector’.

You got it all, the secondary sector is the key to Cameroon becoming the so longed for NIC. We must however ask ourselves this one question, ‘how feasible is the attainment of a double-digit growth in any sector of the economy if we still run a single-digit growth rate in 2013 (5.5%)? 2035 is just 21 years away? Are we ready? The answer is definitely ‘no’.

We can better understand why Cameroon is not ready or set for double-digit growth from the analysis of the following table.

Table 1: Targets Summary Table for the Industrialization Indicator

N0	Indicator	2005-2007 Average	2010	2015	2020	2025	2030	2035
	GDP structure
1	Primary Sector	44.0	41.8	33.2	26.4	21.0	16.7	13.3
2	Secondary Sector	18.5	19.1	25.9	30.9	34.5	36.8	38.2
3	Tertiary Sector	37.5	39.1	40.9	42.6	44.5	46.5	48.5
4	Growth Rate	2.7	4.2	7.1	10.3	10.5	11.2	9.9
	Employment Distribution
5	Primary Sector	55.7	49.3	43.7	38.7	34.3	30.4	26.9
6	Secondary Sector	14.1	15.8	17.8	20.0	22.4	25.2	28.3
6	Tertiary Sector	30.2	32.2	34.4	36.7	39.2	41.8	44.6

**All figures are in percentages.**

(Adapted from Cameroon’s Vision 2035.)

From Table 1 above, we see that Cameroon is expected to have a GDP growth rate of 7.1. We are already in 2014 and haven’t been able to achieve a 7% growth rate, we still at 5.5% (2013 statistics). With the low level of economic activity on-going in the nation, can we bet on attaining a 7.1% growth rate by 2015? I, personally, would not bear such risk!

Decreasing agriculture’s contribution to national GDP is yet another debate as Cameroon in its present state lacks agricultural engineers, modern farming equipment and technologies. However, the primary sector is not the center of discussion now. This sector shall be dealt with in subsequent reviews and critiques of Cameron’s National policy paper (Vision 2035).

Development of Industrial Infrastructure

Section 3.3.2 of Vision 2035 analyzes the various industrialization infrastructure that need to be set in place for industrialization to effectively kick off. The principal industrialization infrastructure mentioned are:

• Development of communication and telecommunications infrastructure, and 
• Development of energy infrastructure.

1. Development of Communication and Telecommunications Infrastructure

This is further subdivided into the following:

• Transport infrastructure
• Telecommunications infrastructure

      2. Development of Energy Infrastructure

The major areas here are:

• Developing the big hydroelectric and gas potential,
• Intensifying exploration and developing oil resources,
• Developing alternative energies, and
• Extending and monitoring transport and distribution facilities and networks.

Analysis of the Development of Industrialization Infrastructure Plans

The plans set by the Vision 2035 to establish industrialization infrastructure are all plausible. The challenge remains in implementing and following up the execution of these plans. A possible measure which could help in achieving these plans is the setting up of commissions to run the plans. The government could also split up the plans into short-year plans of say 5 years as is done in Malaysia (Malaysian 5Year Plans).

Conclusion

A lot still needs to be done in the industrial sector if Cameroon is to attain emergence by 2035. A revision of Vision 2035 is also necessary as it doesn't clearly illustrate regional development goals and plans. A regional approach would be easier to apply. Milestones also need to be set for better evaluation of progress. God bless Cameroon!

Works Cited

Stephen Thomsen, M. P.-H. (2013). OECD Investment Policy Reviews: Malaysia 2013. Kuala Lumpur: OECD.

Appendices

Appendix 1: Empirical Industrial Development Stages

Empirical Industrial Development Stages
Industrial Development Stages	1 Exportation of Primary Goods	2 First import substitution	3 First Export substitution	4 Second Import substitution	5 Second Export substitution
Structure of Commerce and Production
A.    Raw materials	Exports	Exports	Reduced Exports	Imports	Imports
B.     Light Manufactured products	Imports	Substitution with Domestic goods	Exports (Substitution of raw materials)	Exports	Exports
C.     Heavy Manufactured Products	Imports	Imports	Imports	Substitution with domestic goods	Exports (Substitution of Light Manufactured products)
Measure: * Manufacturing share/GDP	…<11%	11%<…<17%	17%<…<23%	23%<...<24%	24 %<…
Comments		The importation of light manufactured products is substituted with local production.	The exportation of raw materials is substituted with light manufactured products.	The country has few raw materials and consequently imports. It substitutes the importation of heavy manufactured goods with local production. The main exported products are heavy manufactured goods.	The country substitutes the exportation of light industrial products with heavy industrial products.