Domestic and Foreign Market Access

Overview: Trade Policy and Business Environment

 The republic of Cameroon is classified as a lower middle income country in Central Africa. Cameroon was ranked 118th out of 132 countries in the World Economic Forum (WEF) Enabling Trade Index (2012), which measures institutions, policies and services to facilitate trade in countries. With a naturally advantageous position at the heart of Africa, Cameroon has become a regional centre for trade in goods and services. The agriculture, manufacturing and service sectors remain key to the health of the Cameroonian economy yet GDP growth has been restricted in recent years due to energy supply reaching capacity. The country’s export range remains amongst a small group of primary products, notably; agricultural and forestry products. There has been a lack of growth in exports since 2007, due to incessant supply-side constraints including poor energy, communications, water and transport infrastructure, as well as an overall unfavourable business climate (WTO 2013).

WEF, 2012, Global Enabling Trade Report
WTO, 2013, Trade Policy Review (Cameroon)

INDICATOR, UNITS RANK/132 SCORE
Domestic Market Access The pillar assesses the level and complexity of a country’s tariff protection as a result of its trade policy. This component includes the effective trade-weighted average tariff applied by a country, the share of goods imported duty free and the complexity of the tariff regime, measured through tariff variance, the prevalence of tariff peaks and specific tariffs, and the number of distinct tariffs. 125 3.39
Foreign Market Access The pillar assesses tariff barriers faced by a country’s exporters in destination markets. It includes the average tariffs faced by the country as well as the margin of preference in destination markets negotiated through bilateral or regional trade agreements or granted in the form of trade preferences. 58 2.81
Tariff rate (%) This indicator is calculated as a trade-weighted average of all the applied tariff rates, including preferential rates that a country applies to the rest of the world. The weights are the trade patterns of the importing country’s reference group (2012 data). An applied tariff is a customs duty that is levied on imports of merchandise goods. 128 14.26
Complexity of tariffs , index 1-7 (best) This indicator is calculated as the average of the following indicators: Tariff dispersion, Specific tariffs and Number of distinct tariffs. See description of each individual indicator for more details. Prior to averaging, values for each indicator were transformed to a 1–7 score, using the min-max method. 28 6.58
Tariffs dispersion (standard deviation) This indicator reflects differences in tariffs across product categories in a country’s tariff structure. The variance is calculated across all the tariffs on imported merchandise goods, at the 6-digit level of the Harmonized Schedule. 93 9.62
Tariffs peaks (%) This indicator is the ratio of the number of tariff lines exceeding three times the average domestic tariff (across all products) to the MFN (most-favoured nation) tariff schedule. The tariff schedule is equal to the total number of tariff lines for each country. These tariffs are revised on a yearly basis. 1 0.00
Specific tariffs (%) This indicator is the ratio of the number of Harmonized System (HS) tariff lines, with at least one specific tariff, to the total number of HS tariff lines. A specific tariff is a tariff rate charged on fixed amount per quantity (as opposed to ad valorem) 1 0.00
Number of distinct tariffs This indicator reflects the number of distinct tariff rates applied by a country to its imports across all sectors. 19 5.00
Share of duty-free imports (%) Share of trade, excluding petroleum, that is imported free of tariff duties, taking into account MFN tariffs and preferential agreements. Tariff data is from 2013 or most recent year available and imports data is from 2012 110 21.49
Tariffs faced (%) This indicator is calculated as the trade-weighted average of the applied tariff rates, including preferential rates that the rest of the world applies to each country. The weights are the trade patterns of the importing country’s reference group (2012 data). A tariff is a customs duty that is levied by the destination country on imports of merchandise goods 104 5.55
Index of margin of preference in destination markets, 0-100 (best) This indicator measures the percentage by which particular imports from one country are subject to lower tariffs than the MFN rate. It is calculated as the average of two components: 1) the trade-weighted average difference between the MFN tariff and the most advantageous preferential duty (advantage score), and 2) the ratio of the advantage score to the trade-weighted average MFN tariff level. This allows capturing both the absolute and the relative margin of preference. 47 42.22
Source : World Economic Forum, Global Enabling Trade Report 2014

Trade Policy and Market Access

Cameroon is a founder member of the WTO and, in addition, is a member of the main regional economic communities, the Central African Economic and Monetary Community (CEMAC) and the Economic Community of Central African states (ECCAS). Cameroon, as a member of the CEMAC Customs Union, adopts the CEMAC common external tariff (CET) and its simple average MFN rate in 2013 was 18.1 per cent. Despite the establishment of the free trade area among CEMAC countries, the level of intra-community trade has remained low overall; distortion of CET and numerous non-tariff barriers form impediments to trade in the region such as overtaxing of goods, random checkpoints along corridors and highways remaining in poor condition. Cameroon is, however, the only country among the seven Central African states to have signed an interim Economic Partnership Agreement (EPA) with the EU, and therein stands to benefit from preferential access to EU markets. The government gives trade integration a leading role in its ‘Vision 2035’ strategy to transform Cameroon into an ‘emerging economy’. This includes further integration with Nigeria and within ECCAS, yet the government acknowledges that improvements to market access and cross-border trade are required to achieve these ambitious goals. In an effort to spur trade in Cameroon the government is proposing, in 2013, a raft of policy incentives to foreign firms such as: tax, customs and administrative streamlining to improve transparency and further liberalisation of the market. (WTO 2013; European Commission 2013; ADB 2011).

African Development Bank, 2011, Central Africa – Regional Integration Strategy Paper, 2011-2015

European Commission, 2013, Calls against the ratification of EPA with Cameroon

U.S. Department of State, 2013, Investment Climate Statement (Cameroon)

WTO, 2013, Trade Policy Review (Cameroon)

Standard Compliance and Other Relevant Import/Export Restrictions

The CEMAC Agreements contains two articles dealing with the harmonisation of technical and health regulations, standards and conformity assessments. However, it does not mention the Technical barriers to trade (TBTs) Agreement, although it calls for the elimination of any measure that negatively affects trade between parties. Among CEMAC countries, only Cameroon has a sanitary and phytosanitary (SPS) enquiry point, which remain non-operational due to a lack of internet access and are therefore in need of capacity building assistance. Moreover, notification of sanitary or phytosanitary measures have not been made to the WTO, except for select sanitary import measures in place since 2006. In 2011, the CEMAC countries recently signed a memorandum of agreement creating the Central African Sub-regional Metrology Organization (CEMACMET), aiming to promote metrology and related activities to facilitating trade.

OECD, 2010, Bilateral and Regional Trade Agreements and Technical Barriers to Trade: An African Perspective

WTO, 2013, Trade Policy Review (Cameroon)