Cameroon - Politics, government, and taxation
Cameroon was originally colonized by Germany, but was divided between England and France after World War I. Since gaining independence in 1960, Cameroon has had only 2 presidents: Ahmadou Ahidjo, who relinquished power voluntarily in 1982, and Paul Biya, the current president, who was elected to a 7-year term in 1997.
Historically, political stability has proved one of Cameroon's most vital economic assets. The country has watched civil wars and serious unrest erupt in each of its neighbors, while managing to avoid major conflict within its own borders. Cameroon's first president, Ahidjo, ruled the country by sometimes authoritarian methods, but the resulting stability allowed for the growth of a highly diverse economy.
The popularly-elected Cameroonian president presides over the unicameral (1-house) National Assembly, comprising 180 seats. Members are elected by popular vote to a 5-year term of office, but the president has the power to lengthen or shorten the term of a government. Though Cameroon is a stable country with ostensibly democratic institutions, political power remains concentrated in the hands of President Biya and his ruling party. Like the heads of state of many neighboring countries in sub-Saharan Africa, President Biya has developed a democratic facade while maintaining effective control of most governmental institutions. Past elections have been marred by serious fraud, leading most major opposition parties to boycott the most recent elections in 1997. President Biya will be eligible for reelection in 2004.
The ruling Democratic Rally of the Cameroon People (RDPC) has dominated Cameroonian politics and controlled its government since independence. Since 1990, many opposition parties have freely organized themselves to compete in elections, but the opposition remains divided. The most prominent opposition parties include the Social Democratic Front (SDF), led in 2001 by John Fru Ndi; the National Union for Democracy and Progress (UNDP), led in 2001 by Maigari Bello Bouba; and the Cameroonian Democratic Union (UDC), led in 2001 by Adamou Ndam Njoya. All of these parties espouse similar ideologies of free enterprise.
Cameroon is handicapped by the lack of an effective and independent judiciary. Judges are appointed by the president, and courts are subject to the influence of money and politics. In 1999, Groupement Inter-Patronal du Cameroun (GICAM), an organization representing and coordinating Cameroon's largest businesses, established a business arbitration center in order to avoid the inefficiencies and uncertainties of Cameroon's legal system. A regional commercial court is due to be established in N'Djamena in Chad. Lack of an independent court system further deters foreign companies from investing in Cameroon.
The country is gradually reducing the legacy of state involvement in economic affairs that it inherited from France. Beginning in 1997, Cameroon began collaborating with the IMF and the World Bank on a new structural adjustment program. Four previous reform programs ended in failure, but the recent program has been more successful. Reforms have sought to privatize state enterprises and improve management practices in government. The tax code has been simplified and customs rules have been partly reformed in order to bring Cameroon into harmony with regional standards established by the Central African Economic and Monetary Community (CEMAC), the economic and monetary community of Central Africa.These measures have contributed to the recent turnaround in Cameroon's economy.
As part of its structural adjustment reforms, Cameroon is continuing the process of privatizing its state enterprises. Though the pace of this process has been slow, a state insurance company, the national railroad, the mobile telephone company, and all state banks have been privatized, as have several agro-industrial firms, including the state sugar company, a rubber company, and a palm oil company. Plans for the privatization of Cameroon Airlines and the Cameroon Development Corporation are well advanced, and the state electricity, water, and telephone companies should be privatized during the next 2 years. The privatization process has already contributed to recent economic growth by encouraging investment in developments that the state was unwilling to finance.
Cameroon's government generates revenues primarily from oil sales, customs duties , and taxes on businesses. Oil revenues declined from 50 percent of government revenue in the 1980s to 30 percent in the 1990s before returning to 50 percent when oil prices rose in 1999-2000. During the late 1990s, Cameroon began to revise its tax and customs codes to bring them into compliance with CEMAC standards. As part of CEMAC's regional integration plan, all 5 member-countries established a value-added tax and began to harmonize their customs duties.