Cameroon: Diversity, Growth and Poverty Reduction

Despite high rates of economic growth during the 1965-85 period, the 1983/84 Household Budget Survey (HBS) found a high degree of poverty in rural areas and marked inequality in income distribution. In 1983/84, poor and very poor households accounted for only 20 percent and 8 percent, respectively of total consumption and were concentrated in rural areas. Per capita food consumption (in CFA terms) of poor households was one-quarter (and, for the poorest households, one-fifth) that of nonpoor households. Disparities were even greater for total consumption. The poverty status of households is significantly affected by their age and gender structure, size, education level, and location. Regional disparities in per capita consumption were also marked. Geographic location is, therefore, a strong indicator of poverty in Cameroon.

Since the mid-1980s, Cameroon has experienced rapid impoverishment, with a very sharp decline in per capita consumption and a marked increase in the incidence of urban poverty. While fewer than 1 percent of households in Yaoundé and Douala fell below the poverty line in 1983, more than 20 percent of households in Yaoundé and 30 percent in Douala did so in 1993. In Yaoundé, the level of per capita consumption is about 10 percent lower than it was in 1964. Rural areas have not been spared Cameroon's recent economic collapse, and rural poverty is estimated to have increased considerably in recent years.

Incentive and Regulatory Framework

Since 1985, there has been a sharp reversal in economic performance, due to a variety of external and internal factors. GDP per capita declined by 6.3 percent per year from 1985 to 1993. Cumulatively, Cameroon has experienced a drop in average per capita income of 50 percent in eight years. Early in 1994, the country embarked—along with the other countries of the CFA franc zone—on a new economic course that has the potential to reverse the economic downturn. It is still too early to assess the impact of, and response to, the devaluation. Preliminary estimates suggest that agricultural exports rose by 11 percent in 1994. Inflation, estimated at 48 percent in 1994, and the recent export taxes on coffee (25 percent), cocoa, rubber, and cotton (15 percent), tea and bananas, can be expected to dilute its positive impact.

Increasing land scarcity, changes in patterns of land ownership and use, and the coexistence of multiple legal and customary frameworks for addressing land issues present a critical long-term challenge for Cameroon. There is a risk of growing landlessness among the poor and, with it, an incapacity to sustain livelihoods. Land policies need to be grounded in Cameroon's very diversity, and build on an explicit recognition of functioning customary arrangements. This can be achieved if local institutions are identified as providing the framework for land administration at the local level.

Institutional factors affecting poverty reduction include unclear mandates and duplication, the lack of transparency and accountability, weak human and financial resource management, and cuts and imbalances in budget allocations. The country's rich resource endowment leads many to believe that public mismanagement, not lack of resources, is the core development problem that requires fundamental change.

Public Expenditures

There are increasing demands on the public budget, with a continued squeezing out of non-salary expenditures to cover salary costs. Actual non-wage expenditures in 1992/93 represented only 5 percent of total expenditures for education and 13 percent for agriculture and health. Data indicate a strong degree of centralization and marked regional disparities in allocations. The budgets for 1993/94 and 1994/95 suggest that allocations continue to favor sectors that prima facie are not focused on poverty reduction.

Safety Nets

Institutions in charge of social safety nets have become ineffective at providing minimum social security to the poor and the vulnerable, principally as a result of budget shortages. Individuals and institutions have adopted various mechanisms for coping with the impact of increasing poverty including: (a) diversifying income sources and mobilizing family labor, with a greater role for women's informal sector income; (b) having recourse to self-medication and traditional medicine; (c) making children, particularly girls, to drop out of school; and (d) savings in the informal sector (njangi or tontines).

Poverty Strategy

Future poverty reduction can only take place in a context of sustained pro-poor growth. The strategy focuses on sustaining and strengthening the economic reform effort initiated with the devaluation of the CFA franc in January 1994, including: (i) labor-intensive growth policies favoring the poor and (ii) restructuring public finance, especially public spending, to emphasize critical human resource and infrastructure expenditures that will benefit the poor. Increasing food security is at the forefront, through the promotion of small-scale food production, processing, and marketing sectors, alongside associated investment in infrastructure, marketing, and appropriate technology. More needs to be done to integrate women into the decisionmaking process, and communities need to play a greater decisionmaking role in their own affairs. To address systemic poverty issues, the strategy outlines some elements of a long-term agenda addressing environmental, land tenure reform, and institutional performance issues as a foundation for sustainable development.

Statistical System

Cameroon has changed dramatically in recent years. Yet information on trends is very poor, especially on rural income, expenditure, and welfare. A poverty monitoring capacity needs to be developed. The Household Budget Survey (ECAM) should be carried out in 1995/96 to ensure more accurate measurement of consumption trends and household responses. Participatory poverty assessments could become a core instrument of the government's partnership with local NGOs and interest groups. A report and workshop on poverty trends in the country could be organized annually to synthesize the results of the surveys and to discuss findings of relevance to policymakers in monitoring trends and in defining poverty reduction measures.