Country Report Cameroon September 2009

Summary

The ruling Rassemblement democratique du peuple camerounais (RDPC) is expected to continue to dominate the political scene in 2009-10, although factional divisions will increasingly jeopardise its unity.
Given the advanced age of the president, Paul Biya, and the reportedly fragile state of his health, his departure from office as a result of sickness cannot be ruled out. In such an event, the ensuing power vacuum could be destabilising.
On the basis of recently published GDP data from the World Bank, we now forecast modest fiscal surpluses equivalent to 0.3% of GDP in 2009 (previously 0.8% of GDP) and 0.6% of GDP in 2010 (previously 1.1% of GDP).
In view of disappointing recent figures on oil output in the first half of 2009, we now forecast that the economy will contract by 1.5% in 2009 (compared with 0.6% previously), before growing by 1.4% in 2010.
World prices for food and fuel will drop in 2009, but lower subsidies will offset some of this deflationary pressure, leading to average inflation of 2.5%. Higher commodity prices will sustain inflation at 3.2% in 2010.
New GDP and oil production data have led us to downgrade our forecast for the current-account deficit to an equivalent of 3% of GDP in 2009 (2.3% of GDP previously) and 1.9% of GDP in 2010 (1.2% of GDP previously).

Mr? Biya promised during his recent visit to France that his administration would consider allowing expatriate Cameroonians to vote in future elections.
In mid-August an influential local human rights group published a report that was highly critical of prison conditions, press freedom restrictions and abuses committed by security service officials.
The prime minister, Philemon Yang, has restated the government's intention to move ahead with decentralisation. He said that the necessary laws would be in place by 2010.
Cameroon's customs service has introduced electronic transit monitoring and traceability technology to combat the fraudulent dumping on the national market of goods intended for re-export.
Cameroon's electricity utility, AES Sonel, has signed a preliminary power-purchase agreement (PPA) with the aluminium smelter Alucam, which has ambitious plans to increase its output.
In July Cameroon's national oil company, Societe nationale des hydrocarbures (SNH), awarded three off-shore exploration concessions. Under the agreement the government will receive 25% of revenue from any future production.

This report covers the following industry codes:
SIC Code: 49
NAICS Code: 22