Free flow of goods:

Cameroon-EU Trade Partnership Accord goes operational

The free exchange of goods between Cameroon and countries of the European Union is now a reality this after the Economic Partnership Accord with the EU went operational on 4 August 2016. But while government authorities say it is a blessing to the country, critics contend that Cameroon economy stands to lose and badly so.

By Essan-EkoninyamEku in Douala

The MINEPAT, Louis Paul Motaze,

signed the EPA for Cameroon

Thursday, 4 August 2016 has gone down the annals of history as the day when the Cameroon – European Union (EU) Partnership Accord goes into force. It was expected some 14 years ago when negotiations for the accord began, that other countries of the Economic Community of Central African States, ECCAS, would all qualify for the accord at the same time. But that was not to be. As it stands, Cameroon is the only country in the sub-region that has done so.

                By Cameroon qualifying for the accord, it means that customs duties on some products coming from EU countries will be dropped, for a transitory period up till 2023. This has to do with three groups of products. The first comprises consumer goods, raw materials as well as some equipment. They include industrial and high technology machines coming from Europe such as computers, sewing machines, engine saws, cranes, medication, medical equipment, chemical products, seeds, textbooks, etc. The liberalization of goods of this group will be done within four years beginning from the first year of the liberalization.

                The second group of products consists essentially of heavy equipment such as tractors, goods transportation vehicles, industrial and electrical machines, raw iron, steel and metallic products, etc. These ones will be liberalized after nine years.

                For its part, the third group of products comprises private vehicles and machines as well as food products that are neither manufactured nor transformed in Cameroon. Such goods will be liberalized after 15 years.

                However, these tax exonerations will exclude some products that will enable Cameroon to protect its agricultural and industrial market which the country considers sensitive. Thus in the food sector, Cameroon will continue to transform some products locally such as food pastes, chocolate, mineral water, soft and alcoholic drinks, tobacco, and meat. In the textile sector, there is wool and some other types of clothing. In the wood sector, products such as wooden or plastic furniture are exempt from these exonerations.

                It is important to note that this partnership accord equally exonerates taxes for Cameroonian goods exported to EU countries. The goods concerned include banana, aluminum, products derived from cocoa and wood as well as fresh or transformed fruits and vegetables worth 200 billion FCFA.

             Polemics

                The elimination of customs duties for goods imported by Cameroon from Europe has provoked quite some contentions between the government and its experts on the one hand and researchers and other economic experts on the other. The government never fails to justify its choice, saying the exonerations will certainly have a positive impact on Cameroon’s economy.

                Its experts argue that European countries and those of Asia (such as the Koreas which some decades ago were at the same development level with Cameroon) are where they are today owing to the fact that they opened up to global trade exchanges. 

                On the other hand, those who are not in support of the partnership accord contend that Cameroonian products which for the most part are primary products cannot compete with those of European countries for they run the risk of not having access to the European market. Worse still, they say, Cameroon may lose tax revenue coming from the ECCAS zone where it exports most of its products.

                The consequence, they argue, is that the country’s balance of payment would be permanently in the negative and this would leave Cameroon with less money for public investment, especially for the development of the social sector and of infrastructure. This is especially so as Cameroon is the only country in the sub-region to have signed the accord.

                As at now, observers say, it is only a matter of wait and see.