Country Report Cameroon June 2008

Outlook for 2008-09

• The 75-year-old president, Paul Biya, supported by the ruling party, Rassemblement democratique du peuple camerounais (RDPC), will continue to dominate the political scene during the forecast period.
• The recent social unrest caused by unemployed youth is a source of concern for the regime, since it could become a formidable challenge if it were to become politically organised.
• The regime will continue to seek closer ties with countries interested in developing Cameroon's untapped natural resources.
• One of the government's priorities will be to contain the rapid rise in the cost of living.
• Real GDP growth is expected to remain subdued, at 3.6% in 2008, owing to the negative effect of social unrest on investment plans, although it will accelerate to 4.8% in 2009 as construction of new mining projects begins.
• The current-account deficit is forecast to narrow from an estimated 1.8% of GDP in 2007 to 0.1% of GDP in 2008 owing to high oil prices, before widening to 0.6% of GDP in 2009 as a result of increased imports.

Monthly review

• Several senior government officials have come under investigation as part of the probe into the aborted purchase of a presidential aircraft in 2004.
• Mr Biya has used his executive powers to reduce the prison terms of some of those sentenced for their part in the February 2008 riots.
• Cameroon's trade unions have launched a campaign to increase the wages of private-sector employees, demanding double-digit increases.
• According to figures recently published by the national oil company, oil production declined by 2% in 2007, to 31.2m barrels (equivalent to 85,300 barrels/day), mainly as a result of a fall in production in the smaller oilfields.
• The government has stepped up efforts to find investors willing to finance the construction of a deep-sea port at Kribi.
• An Australian company, Sundance Resources, has announced promising results from its ongoing exploration programme at the Mbalam iron deposit.
• A US company, Geovic, has progressed with its plans to start construction works at the Nkamouna cobalt deposit by late 2008.
• The national air carrier, Cameroon Airlines (Camair), has ceased to operate owing to its increased financial difficulties. Over 800 employees have been made redundant.