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Cameroon
Score Rank
Financial Standards Index 9.17 out of 100 90
Business Indicator Index 4.15 out of 12 88

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Overall Standards Summary

Cameroon achieves very low overall compliance with international standards and codes, with a score of 9.17 out of 100 in our Standards Compliance Index. Cameroon's compliance in all three broad categories is poor. Further, the predominance of standards with insufficient information makes an accurate assessment of the current situation difficult. Cameroon is not a subscriber to the International Monetary Fund's Special Data Dissemination Standard, and does not comply with the macroeconomic transparency codes either nationally or at the supranational level of the Central African Economic and Monetary Community (CEMAC). Two other areas for which assessments are publicly available are payment systems and banking supervision. For the first, a World Bank project is expected to help Cameroon comply with international standards. For the second, an IMF assessment asserted significant shortcomings in the authority of the Central African Banking Commission and hence in Cameroon's compliance with the Basel Core Principles. Also, according to recent reports Cameroon has not adopted International Standards on Auditing or International Financial Reporting Standards.

Choose a standard for a detailed compliance report:
12 Key Standards for Sound Financial Systems

Compliance Level
Special Data Dissemination Standard
NC
Code of Good Practices on Transparency in Monetary Policy
NC
Code of Good Practices on Transparency in Fiscal Policy
ID
Effective Insolvency and Creditor Rights Systems
II
International Financial Reporting Standards
NC
Principles of Corporate Governance
II
International Standards on Auditing
NC
Anti-Money Laundering/Combating Terrorist Financing Standard
II
Core Principles for Systemically Important Payment Systems
ID
Core Principles for Effective Banking Supervision
NC
Objectives and Principles of Securities Regulation
II
Insurance Core Principles
II
II = Insufficient Information | NC = No Compliance | ID = Intent Declared | EN = Enacted | CP = Compliance in Process | FC = Full Compliance

Macroeconomic Policy and Data Transparency

NCSpecial Data Dissemination Standard

Cameroon does not yet subscribe to the International Monetary Fund's (IMF) Special Data Dissemination Standard, but it has been a participant in the less stringent General Data Dissemination System since December 2000. Cameroon has since taken steps to improve its statistical data, particularly regarding balance-of-payments and national accounts. Nonetheless, there is much room for improvement. Whereas the Ministry of Finance and the regional Bank of Central African States were the primary data reporting authorities at the time of the IMF's 2001 Report on the Observance of Standards and Codes, the 2007 Article IV Consultation notes that this role is now played by the National Institute of Statistics (INS), which operates autonomously within the Ministry of Economic Affairs, Programming, and Regional Development. However, the INS lacks a clear mandate, which makes it difficult to implement methodological and classificatory standards across government agencies.

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NCCode of Good Practices on Transparency in Monetary Policy

As a member state of the Central African Economic and Monetary Community (CEMAC), Cameroon's monetary policy is formulated and carried out by the Bank of Central African States (BEAC). The International Monetary Fund's 2000 Report on the Observance of Standards and Codes found that Cameroon, as a member state of BEAC, fully complied with the requirements of Principle 1 of this standard, "clarity of roles, responsibilities, and objectives," and partially complied with the requirements for "open process for formulating and reporting policy decisions," "public availability of information," and "accountability and assurances of integrity." The IMF's 2006 Financial Systems Stability Assessment for the CEMAC region, however, found that the BEAC had only limited transparency regarding monetary policy execution. The 2006 IMF report recommended broader involvement in the policy-making process, and suggested that clearly stated rules for implementation should be set forth. In addition, the IMF called for the creation of a monetary policy board drawn from member-state government appointees as well as the governor and vice-governor of the BEAC, with the governor serving as chair. Cameroon participates in the IMF's General Data Dissemination System, whose website discloses that BEAC plans to reduce time lags that currently exist in the publication of its bulletins and research studies.

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IDCode of Good Practices on Transparency in Fiscal Policy

The IMF published a Report on the Observance of Standards and Codes dealing with Cameroon's Fiscal Transparency framework in 2000. At the time, the IMF found that Cameroon's legal framework was transparent to some degree, but that the system was too complex to be effective, and problems of enforcement further compromised transparency. In 2005, the IMF recommended that budget preparation and execution be more closely linked with both the Poverty Reduction Strategy and the objectives of the Medium Term Expenditure Framework. Fiscal policy transparency could be further enhanced by restructuring and privatizing the more loss-prone public enterprises. In its 2008 project, the Open Budget Initiative scored Cameroon at only 5%, noting that there was no public access to most of the budget documents. According to the IMF's Sixth Review under the Three-Year Arrangement under the Poverty Reduction and Growth Facility, published in 2009, Cameroon is working with the IMF on the implementation of a new Organic Budget Law, passed in 2007, which seeks to restructure the budget, strengthen its execution, and provide enhanced transparency. The 2009 Review further notes that the authorities intend to focus on the implementation of the new organic budget law and plan to strengthen their ability and capacity to prepare investment projects within a medium-term framework. It also underlined that administrative capacity needs to be strengthened in order to successfully implement these tasks.

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Institutional and Market Infrastructure

IIEffective Insolvency and Creditor Rights Systems

The U.S. Department of Commerce's 2007 Country Commercial Guide reported that bankruptcy and insolvency legislation in Cameroon is a part of its Commercial Code. Cameroon is a member of the Organization to Harmonize Business Laws in Africa (OHADA), which promulgates uniform laws applicable to its member states. As an OHADA member, Cameroon observes the Uniform Act Organizing Collective Proceedings for Wiping off Debts, Sections 2 and 3 of which directly address bankruptcy issues. A 2006 International Monetary Fund Financial System Stability Assessment of the Central African Economic and Monetary Community region stated that OHADA's complex regulatory framework for insolvency should be improved, as should shortcomings in the national judicial systems. A 2009 IMF Financial Sector Assessment Update report cited weaknesses in four areas of the legal and judicial capacity of Cameroon: secured transactions, the land tenure system, debt collection and the enforcement of mortgages and other collateral, and commercial judicial capacity. In addition, the 2009 IMF report noted the difficulty reconciling the common law principles indigenous to Cameroon's parallel legal system with OHADA's civil law construction. Beyond this information, however, there is insufficient information publicly available as to Cameroon's compliance with the Principles and Guidelines for Effective Insolvency and Creditor Rights Systems developed by the World Bank.

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NCInternational Financial Reporting Standards

According to a December 2006 Institute of Chartered Accountants of Cameroon (ONECCA) self-assessment, all companies in Cameroon except for banks and credit institutions must comply with the Organization for the Harmonization of African Business Law (OHADA) accounting framework. Banks and credit institutions adhere to standards issued by the Central African Banking Commission (COBAC). In the self-assessment, the ONECCA noted that it encourages its members to use International Financial Reporting Standards (IFRSs), and they are working towards increasing awareness and support for adoption of IFRSs by organizing seminars, press conferences and discussions with relevant authorities. Cameroon is a member of the Central African Economic and Monetary Community (CEMAC) and as such has to comply with the CEMAC legal framework. According to a 2006 International Monetary Fund (IMF) report on CEMAC, the OHADA accounting requirements are excessively burdensome for Small and Medium-size Enterprises. The IMF in 2006 recommended strengthening the accounting framework for large companies and making it more consistent with the IFRSs. Despite the 2006 recommendations, a 2009 IMF report on Cameroon, suggests that neither OHADA nor COBAC standards are harmonized with IFRSs. The report goes on to point out that COBAC standards have not been updated in more than a decade and differ from IFRSs in recognition, valuation, presentation, and disclosures.

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IIPrinciples of Corporate Governance

In its 2000 Report on the Observance of Standards and Codes (ROSC), the International Monetary Fund (IMF) recommended drafting a law on market discipline and corporate governance in Cameroon. A 2004 African Development Bank report criticized the incompetence and lack of independence of board members, as well as insufficient protection of minority shareholder and stakeholder rights. In a 2007 Selected Issues report, the IMF recommended promoting stronger corporate governance and using best accounting practices for small and medium-sized enterprises. A 2008 U.S. Department of Commerce (DoC) report and a 2009 IMF report both note some progress Cameroon has achieved in anti-corruption and enhancing governance and transparency, including signing the United Nations convention on combating bribery, setting up an audit chamber, and establishing a national anticorruption commission. The Financial Markets Commission was legally established in 1999 with the aim of protecting investors' savings and ensuring the proper functioning of financial markets. The Douala Stock Exchange (DSX) was inaugurated in April 2003 as the sole securities markets agent in Cameroon. The IMF's 2006 Central African Economic and Monetary Union regional Financial Sector Assessment Program suggests that DSX merge with the Central African Stock Exchange in order to preserve the viability of the market, considering its small size and limited resources. Overall, there is insufficient publicly available information regarding Cameroon's compliance with the Organization of Economic Cooperation and Development's Principles of Corporate Governance.

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NCInternational Standards on Auditing

According to a December 2006 Institute of Chartered Accountants of Cameroon (ONECCA) self-assessment, Cameroon does not legally require the use of International Standards on Auditing (ISAs) issued by the International Auditing and Assurance Standards Board (IAASB). However, ONECCA reported that it informs its members of the existence and availability of the IAASB pronouncements, takes measures to train its members, and conducts seminars on the IAASB standards and guidance. Furthermore, ONECCA pointed out that it plans to officially adopt the IAASB pronouncements. A 2006 International Monetary Fund (IMF) report on the Central African Economic and Monetary Community (CEMAC) noted that the lack of standards for auditing practices in the CEMAC region, which includes Cameroon, raised "serious concerns" regarding the quality of audits. The IMF in 2006 recommended adoption of ISAs to improve the regulatory framework as well as the image of the accounting profession in the region. A 2009 IMF Financial Sector Assessment Update reiterated the findings of the 2006 report, and noted that the framework for auditing continues to be weak and raises concerns about the reliability of audits. The 2009 IMF report also report pointed out that banks are not required to make their audited financial statements public, although in practice some banks disclose this information.

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IIAnti-Money Laundering/Combating Terrorist Financing Standard

Cameroon is part of the Central African Economic and Monetary Union (CEMAC), which shares a common Central Bank, the Bank of Central African States, as well as three regional supervisory authorities. Following the 2001 terrorist attacks in the United States and subsequent United Nations (UN) resolutions, according to a 2005 U.S. Department of State (DoS) report, the CEMAC countries formed the Central African Action Group Against Money Laundering in order to draft a common anti-money laundering law. In 2006, the International Monetary Fund published a Report on the Observance of Standards and Codes (ROSC) on the implementation of the Financial Action Task Force (FATF) recommendations in the CEMAC region. According to the report, a CEMAC Regulation was adopted in 2003, prior to the revision of the FATF methodology in 2004. According to the same report, overall, the CEMAC Regulation criminalizes money laundering and terrorist financing in line with international standards. However, the report also states that, with regards to preventive measure for financial institutions, although the CEMAC Regulation contains numerous provisions reflecting the FATF recommendations, it should be amended and updated to incorporate enhanced due diligence obligations and preventive measures for all financial professions. The CEMAC Regulation provides for the establishment by each member state of a financial intelligence unit. Cameroon established its unit in 2005. Despite the availability of the 2006 ROSC and other reports pertaining to the CEMAC countries' implementation of FATF recommendations, there is little information publicly available addressing Cameroon's actual implementation of the FATF 40+9 Recommendations.

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IDCore Principles for Systemically Important Payment Systems

Cameroon's payments system is part of the CEMAC zone and is operated and supervised by the BEAC. The 2006 International Monetary Fund (IMF) Financial System Stability Assessment (FSSA) of the CEMAC mentions a 2002 payment system reform project spearheaded by the BEAC. According to a 2002 World Bank report, the professed objective of the reform project is to build a comprehensive and consistent payment system infrastructure that complies with the Committee on Payments and Settlement Systems' Core Principles for Systemically Important Payment Systems. The FSSA, however, finds that progress is lax because of a lack of experience, weak coordination, and some disagreements with the national banks regarding the interbank card system component of the project. To accelerate completion of the project the FSSA recommends setting up payment system management units at the BEAC headquarters as well as within each country tasked with the joint responsibility of implementing and supervising the new system. A 2008 World Bank report updates that the closing date of the payment system reform project has been extended from June 2008 to June 2009, but the project itself is being "implemented with good progress towards its development objectives." As part of the project, the wholesale payment system started full operations in November 2007, and the retail payment system began operating in Cameroon in November 2007. The inter-bank card system was expected to start operations at the end of 2008. Following some of the recommendations set out by the 2006 IMF report, a payment system Directorate has been established at the BEAC to supervise the new system, and it will be supplemented by units in each country.

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Financial Regulation and Supervision

NCCore Principles for Effective Banking Supervision

The CEMAC shares a common banking supervisory authority and central bank, the Central African Banking Commission (COBAC) and the Bank of Central African States respectively. In 2000, the International Monetary Fund (IMF) conducted a Report on the Observance of Standards and Codes in Cameroon, and found that Cameroon complied only partially with the Basel Core Principles (BCPs) for Effective Banking Supervision. The IMF's 2006 CEMAC regional assessment points to severe shortcomings with regard to COBAC's independence as a regulator, its resources, and its ability to impose sanctions and thereby take corrective actions against non-complying banks. In addition, although the prudential and regulatory framework has been updated and strengthened in the CEMAC region, it is still not fully in line with international standards. Weaknesses remain, in particular, with regards to the capital adequacy ratio, large exposure limit, and provisioning. In a 2009 Financial System Stability Assessment (FSSA) Update of the 2000 and 2006 reports, the IMF concludes that domestic banks remain vulnerable to credit shocks due to low capitalization levels, high loan concentration, and large stock of non-performing loans. Key recommendations of the IMF's 2009 FSSA Update include dealing with problem banks (government-sponsored financial institutions in particular), raising the minimum capital adequacy ratio for domestic banks, strengthening the judicial system, and moving towards the adoption of International Financial Reporting Standards.

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IIObjectives and Principles of Securities Regulation

The CEMAC also shares a common financial markets supervisor, the Central African Financial Markets Supervisor (COSUMAF). In June 2003, the Financial Sector Reform and Strengthening Initiative (FIRST) Initiative launched a "Capacity Building of the Financial Markets Commission" project for Cameroon, which was completed in June 2005. The aim of the project was to provide the Financial Markets Commission (CMF), the regulatory body of the COSUMAF, with the appropriate tools to supervise and regulate the Douala Stock Exchange (DSX), and in a second phase, assist it in the licensing of issuers, brokers and dealers. However, the project was terminated before the completion of the second phase due to uncertainties about the future of the DSX and the viability of the market. The IMF's 2006 CEMAC regional Financial Sector Assessment Program (FSAP) suggests that the DSX and the Central African Stock Exchange (BVMAC) merge in order to preserve the viability of the market, considering its small size and limited resources. It is also recommended that integration with other financial markets, such as those in West and South Africa, be considered. Consistent with the findings of the 2006 CEMAC regional FSAP, the IMF's 2009 Financial System Stability Assessment update recommends introducing treasury bills, developing the bond market, and establishing appropriate auction mechanisms and primary dealer-type systems. However, Cameroon is not a member of the International Organization of Securities Commissions (IOSCO), and the available reports do not directly address Cameroon's compliance with the IOSCO Objectives and Principles of Securities Regulation.

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IIInsurance Core Principles

CEMAC shares a common insurance regulatory and supervisory authority - the Inter African Conference for the Insurance Market (CIMA). In 2000, the International Monetary Fund (IMF) published a Report on the Observance of Standards and Codes in Cameroon based on the 2000 International Association of Insurance Supervisors (IAIS) methodology. According to the report, although the regulatory and supervisory framework has been considerably strengthened in Cameroon through the adoption of the CIMA Code in 1995, important shortcomings remain with regards to the supervisory practices of the Regional Commission for Insurance Supervision (CRCA), the regulatory body of the CIMA. The IMF's subsequent Financial System Stability Assessment on Gabon (a CEMAC member country) indicates that, although the CRCA is fairly transparent, it lacks adequate resources and relies on national supervisory agencies, leading to problems of conflict of interest and lack of political independence. The IMF's 2006 CEMAC regional assessment also reveals weaknesses in the areas of reinsurance and prudential rules. Cameroon is not a member of the IAIS, and there is insufficient publicly available information regarding Cameroon's compliance with the Insurance Core Principles as revised by the IAIS in October 2003.

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Business Indicators

With an overall score of 4.15/12, Cameroon is below standard on the economic, legal, and political indicators that make up our Business Index. Cameroon has a market-based mixed economy, in which total government expenditure, including consumption and transfer payments, is low. Cameroon passed an Investment Charter in 2002 that recognizes property rights and eases the land acquisition process. Legislation provides guarantees to both foreign and domestic investors that are in substantial compliance with internationally recognized norms. As of January 2008, however, the 2002 Investment Charter had not been fully implemented due to delays in passing the necessary implementing legislation. Because of high poverty rates and declining health and education standards, social unrest has become an increasing issue. Corruption is extensive, as reflected in Cameroon's ranking of 141st out of 180 countries in Transparency International's 2008 Corruption Perceptions Index.

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Global Indices & Quick Facts

Cameroon consistently ranks in the 4th or 5th quintiles in the global indices benchmarking political, economic, business, and human capital climates, as shown below. Cameroon is not an electoral democracy, although there are extant political opposition groups. Political intimidation, manipulation, and violence are common, and virtually all political institutions are subservient to the president. Civil liberties are often harshly curtailed. Bertelsmann reports that, despite good foundations for political and economic transformation based on abundant natural resources, Cameroon has made no progress on either the political or economic fronts. Corruption is perceived to be rampant, as reflected in its low score on the Transparency International Corruption Perceptions Index.

Name Year Rank Score Quintile
Bertelsmann Transformation Status Index 2010 101/128 4.40/10 4
Heritage Foundation Economic Freedom Index 2010 132/179 52.3% 4
Economic Freedom of the World Index 2009 123/141 5.79/10 5
World Economic Forum Global Competitiveness Index 2009 111/133 3.50/7 5
Milken Institute Capital Access Index 2009 108/122 2.63/10 5
World Bank Ease of Doing Business Index 2009 171/183 N/A 5
UNDP Human Development Index 2009 153/177 0.52/1 5
Transparency International Corruption Perceptions Index 2009 146/180 2.2/12 5
Freedom House Index 2009 Not Free 6/7

Credit Ratings

B/Stable Fitch

Not rated Moody's

B/Stable Standard & Poor's

Macroeconomic Data

2009 GDP (Current Prices): 20.4 billion USD (IMF)

2009 GDP (Per Capita): 1,023 USD (IMF)

2010 GDP (Growth Forecast): 2.7% (IMF)


2009 Inflation (CPI): 2.9% (IMF)

2008 Unemployment: 30% (CIA)


2008 Foreign Direct Investment

FDI (Inward): 0.3 billion USD (UNCTAD)

FDI (Outward): 0.00 billion USD (UNCTAD)


2007 Official Development Assistance

ODA (Received): 1,933 million USD (OECD)

ODA (Disbursed): N/A million USD (OECD)

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