Ratification of EU

EU arm-twists Cameroon to ratify trade accord
- Analysts say Cameroon will now become a dumping ground for EU goods
- But government maintains that it is for the well-being of Cameroonians
By Steve Macquens Balemba in Yaounde
The government of Cameroon is having an up-hill task convincing its citizens that the Economic Partnership Agreement EPA that it signed with the European Union has more beneficial than disastrous effects on the country’s economy.
    At a press outing in Yaounde on 15 July 2014, communication minister, Issa Tchiroma Bakary, held that the EPA has the advantage that it would among other things, help to reinforce the country’s economic fabric, boost poverty alleviation, and make good the balance of trade and balance of payments deficits that have hampered the country’s economic growth over the past several years.
    Moreover, Issa Tchiroma argued that the ratification of the EPA would boost external trade and investments, and also create an enabling environment for improved economic governance in the country.
    He added that the EPA would open up new perspectives for growth and development, without posing any threats to sub-regional integration within the CEMAC sub-region.

    “The Motivation of Cameroon to sign the stepping agreement towards the EPA is the ambition to acquire a bigger market share at the international level. Cameroon would also profit from economic diversification and modernization, and maximize the advantages that come with the preferential access of its exports on the EU market,” Issa Tchiroma maintained.
    But beyond the specter of hope painted by the communication minister, analysts contend that the EPA is replete with risks and set-backs. Some say that if anything, the EPA will only transform Cameroon into a dumping ground for goods from EU country’s and would further asphyxiate the already uncompetitive industries at home.
    According to Mr. Yenene of the Cameroon Chamber of Commerce, the EPA would disfavor Cameroon’s balance of trade. This he said is because apart from the consumer goods (including agricultural produce like tomatoes and apples) that would be imported from the EU, Cameroon would also import from the EU, most of the producer goods – machines, equipment, spare parts, that it would use to up-date its industries.
    Yenene further argues that because the EPA eliminates customs duties on EU exports to Cameroon, customs revenue will witness a drastic drop.
    He concluded that these nefarious effects would translate into the general situation of the country’s public finances.
    In fact, Yenene fell short of advising the government to retract from the ratification of the EPA. Interestingly, Mr. Yenene made these remarks even though he was invited by the MINEPAT to serve as a resource person in defending government’s position on the EPA. Issa Tchiroma and his colleague of the MINEPAT, Nganou Ndjoumesi were visibly surprised at Yenene’s intervention during the press outing. Tchiroma as usual dismissed Yenene’s explanations as coming from without.
    But Yenene is not the only one to have openly criticized the ratification of the EPA. According to SDF MP for Wouri, Joshua Osih, Cameroonians are only crying over spilt milk because the president of the republic had already taken the engagement with the EU since 5 years ago when he signed the stepping agreement towards the EPA, on 15 January 2009
    Osih wondered why President Biya did not seek the consent of Cameroonians before engaging the country.
“President Biya is now asking parliament to authorize him to ratify an engagement that he took with the EU without consulting them,” Osih said, remarking that by signing the EPA president Biya has once again demonstrated that he does not have the future and well-being of Cameroonians at heart.
    “Mr. Biya has plunged the country into an abyss. He is now desperately looking for a ladder to take the people out of the socio-economic and political quagmire in which he has plunged them,” Osih further regretted, concluding that it is already too late for Biya and quite unfortunate for the majority Cameroonians who will continue to suffer.

How Cameroon Came to Signing the EPA
    It should be mentioned that after failing to get all the countries of Central Africa ie CEMAC, DR Congo and Sao-Tome and principle to sign the EPA as a block, the EU proceeded to negotiating with individual countries towards the signing of interim bilateral agreements.
    In 2007 Cameroon agreed to engage an exclusive interim stepping agreement towards the EPA with the EU. President Biya signed the stepping agreement on 15 January 2009. It is this stepping agreement that parliament has authorized the president to ratify.
    Understandably, Cameroon signed the interim agreement because she wanted to avoid the dangers of refusing to sign. If Cameroon refused to sign then her trade relations with the EU would be determined by the “general preferential system” and not the “preferential access system.
    The general preferential system imposes heavy taxes on exports into the EU. And this would have in turn rendered our products very expensive and less attractive and less competitive in the EU market. The resultant effect would be that our goods would stock-pile at home, companies would fold up, unemployment would worsen, the economy would slow down gravely and private investments will drastically drop.
    On the contrary, the “preferential access system” would directly and positively impact external trade and competitiveness. And besides, it assures general serenity of public finances, according to Yaounde authorities.   
Accompanying Measures
    However, government is not oblivious of the possible nefarious effects of the EPA. It was for this reason that a plan was contemplated to adapt the industries to meet EU standards. And this entails reinforcing the capacities of industries and economic operators; developing export capacities and ensuring institutional and tax reforms.
    Already, an agency to update local enterprises was created and has since gone operational. It is charged with preparing the country’s economic environment, work towards improving the quality of production to meet international norms and standards, boost output and optimize leadership and management skills.
    Already, some 15 enterprises in the domains of iron and steel, metallurgy, textile, agro-industry, tourism, constructions, electronics mechanic, leather and shoes etc have already been updated thanks to financial assistance (about FCFA 6.5billion) from the EU, through the economic competitiveness improvement program. It is estimated that about 2500 billions would be needed to up-date all the existing enterprises in the country. The Cameroon government is expected to raise 80% of the money while its partners will provide the rest.