By Yerima Kini Nsom
Cameroon’s trade balance and payment balance are on a steady decline due to adverse internal and external factors.
The National Technical Balance of Payment Committee made the revelation in Yaounde recently. The Committee’s release states that the balance of trade, which shows the country’s performance between the country’s imports and exports with the rest of the world, has registered a deficit of 12.8 percent since the beginning of 2014. This deficit marks FCFA 678 billion. It indicates an increase from 2011. That year, the deficit stood at 7.7 percent representing FCFA 1034 billion.
According to the findings of the organisation, the deficit registered within the confines of Gross Domestic Product, GDP, is FCFA 557.2 billion, representing 69.1 percent. Experts pointed at the industrial domain as one of the sectors swelling the deficit with FCFA 1,414.5 billion in 2014. On the other hand, the forestry, agriculture and the petroleum sector generated gains for the Cameroonian economy.
The balance of trade deficit was also fuelled by the dwindling commercial exchanges between the country and its bilateral partners.
Cameroon’s trade with its western neighbour, Nigeria, has already registered a loss of FCFA 342.3 billion. Trade between France and China has a deficit of FCFA 324 billion and FCFA 342.3 billion respectively. Cameroon’s trade with the United States of America faced a downward trend with a deficit of FCFA 178.9 billion.
The silver lining, according to the report of the Committee, is rather trade between Cameroon and other countries of the CEMAC Zone that increased by FCFA 623.7 billion. Besides, the country’s trade with other countries also increased by FCFA 127 billion
The reading of the Committee reveals that the trade deficit with Nigeria is reflected in the perturbed supply of crude oil to the National Refinery Company, SONARA. Such a deficit with France, China and the US has been attributed to Cameroon’s heavy importation of equipment, food and other commodities. Linked to the trade deficit is the balance of payment deficit that Cameroon registered in 2013.
Economists define balance of payment deficit as financial statement that shows a relation between a country’s total receipts from exports and total expenditure on imports. Cameroon’s negative balance of payment, experts say, reflects international trends as well as the recession in the Euro Zone and the declining growth in emerging such as China. It is also due to the fact that Cameroon imports more than it exports, leaving the impression that it is a consumer of foreign goods.
To the Chair of the Balance of Payment Committee, Lazare Bela, the deficit is due to the country’s heavy indebtedness due to the execution of infrastructural projects. It was indicated that deficit in general transactions rose to FCFA 557.2 billion in 2013 which is an equivalent of 3.8 percent of the GDP generated by FCFA 97billion of goods, FCFA 303.9 billion of revenue.
Nonetheless, the deficit accruing from the trade in goods dropped from 30.3 percent to settle at 97.5 billion due to an increase of revenue from trade in the CEMAC Region.