- New sectors act as a spur to eco nomic growth -
Liberalisation and privatisation in a stable environment offer diverse and appealing opportunities for foreign investment
acked by long-standing political stability, Cameroon has managed to maintain a stable business climate and to invest in its infrastructure over the past decade, which has in turn led to the creation of a fair-sized entrepreneur class and increased investment from foreign partners. Today, Cameroon continues to mine the possibilities inherent in its wealth of natural resources and, while agriculture continues to offer opportunities for investors, new sectors have also begun to spur economic growth. New oil exploration is underway, and the government has signed agreements for the development of its vast natural gas resources. The recent construction of the £2.2 billion Chad-Cameroon pipeline has contributed to the growth of local manufactures, as well as an expansion in the construction industry, which has also been boosted by road reconstruction projects. Liberalisation in telecommunications has led to a boom in mobile telephony in the country and ongoing privatisation of state companies continues to open new avenues for the private sector. Additional opportunities are arising from Cameroons strategic position in the centre of the Central African Economic and Monetary Community, as improvements in transport and communications infrastructure slowly forge stronger regional links.
Harnessing Cameroon’s potential energy
Cameroon, the fifth largest oil producing country in the sub-Sahara region, has immense untapped reserves of natural gas, considerable hydroelectric power and unexplored mineral reserves. The country also occupies a strategic location in the Gulf of Guinea, and thanks to the recent inauguration of the Chad-Cameroon pipeline, and the location of the export terminus at Kribi, Cameroon now has the potential to become a notable oil transport centre.
Sub-Saharan Africa's increasingly important role in global oil markets has renewed interest in Cameroon's oil fields, and has led to new exploration in all three of its major petroleum basins. New exploration has also been boosted by revised legislation and incentives in the sector aimed at reversing a decline in production brought about by lack of exploration in the 1980s and 1990s. Additionally, agreements for the exploitation of the countrys 3,885 billion cubic feet of natural gas reserves have been signed with several multinational companies. In the meantime, Cameroon is set to benefit from royalties and taxes generated by the Chad Cameroon pipeline, estimated at £500 million per year for the 25-year duration of the project.
President Biyas administration is welcoming new partnerships with foreign companies interested in helping the country exploit its mining and energy resources, especially in natural gas and hydroelectric power. Minister of Mines, Water Resources, and Energy Henry Kubuh Tume states, We have the largest natural gas deposits in Africa. We also have great hydroelectric potential. The economy here is going to take off with energy, electricity and oil, and these areas are open to partnerships with investors.
Cameroon possesses Africas greatest hydroelectric potential after the Democratic Republic of Congo. Development of Cameroons potential capacity of 500 000 MW (of which only 530 MW has been harnessed to date) would convert the country into one of the leading exporters of power on the continent. Also, the growth of Cameroon's industrial sector in recent years has created many opportunities for the domestic use of natural gas.
Cameroons proven petroleum reserves are estimated at 400 million barrels, and crude oil production is currently estimated at 76,000 barrels per day. Cameroon's downstream oil sector also plays significant role in the country's economy. The countrys only refinery, SONARA, located in the port city of Limbe, produces up to 42,000 b/d for both domestic consumption and export, and recently invested £8.3 million to upgrade its port facilities. The Cameroon Petroleum Depot Company (SCDP), currently in its second stage of privatisation, is responsible for the distribution all petroleum products within the country. The oil sectors regulating agency is the Caisse de Stabilisation des Prix des Hydrocarbures (CSPH). Director of CSPH, Mr. Ibrahim Talba Malla, says new investment is needed in refineries and gas stocking facilities, and believes that Cameroons oil sector is set to expand. He comments, The Gulf of Guinea is going to increase in importance because the United States and Great Britain are no longer interested in oil from the Arabic Gulf. Also, from a strategic point of view, Cameroon is the door to Central Africa.
Mining is another unexplored sector in the Cameroonian economy. The country has extensive bauxite reserves, and an agreement has been signed with Chinese interests to develop a 2000 Mt bauxite deposit to supply Cameroons largest aluminium smelter at Edea. Artisan gold mining accounts for around 45,000 oz/year, but no modern methods have been used as yet to explore the countrys primary gold potential.
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