“Cameroonian Exporters Should Adopt New Strategies”

Dr. Cletus Neba Yah, Senior Lecturer, Department of Economic Analysis and Policy, University of Doua

The Federal government of Nigerian has launched an economic recovery and growth plan 2017-2020 to rejuvenate its struggling economy hit by recess as a result of shrinking oil prices. What new perspectives do you think this will bring in the Nigeria-Cameroon trade exchanges? Nigeria is one of the largest economies in Africa and one of the major trade partners of Cameroon, second only to France. Nigeria has a po- pulation of above 180 million inhabitants and shares about 2,000 km long border with Ca- meroon. The recent oil prices greatly affected Nigeria as its economy highly depends on crude oil exports. These ex- ports represent 70% of public revenue and 90% of foreign reserves. The economic and recovery plan launched by the Nigerian Federal government aims at diversifying the Nige- rian economy so as to boost economic growth and make the economy resilient to commodity price shocks. These reforms entail the development of the other sectors of the economy so as to diversify their export base. The way these policies will affect trade between Nige- ria and Cameroon depends on which strategy Nigeria adopts: If they intend to promote the development of the goods they import from Cameroon, then Cameroonian exporters to Nigeria would need to adopt new strategies to remain in business e.g. by entering into partnerships with Nigerian pro- ducers. On the other hand, if they concentrate on developing the production of goods they export to Cameroon, this will profit Cameroonian consumers as these goods will become cheaper and they will enjoy large consumer surpluses. Also, since the ambitious plan of Nigeria depends on the availability of adequate energy sources, Cameroon stands to benefit by harnes- sing its natural endowments potential in the production of hydro-electricity so as to com- pete for the supply of energy to Nigeria. How can you assess trade relations between Came- roon and Nigeria at the moment? In recent years, trade has never been so blossom between Nigeria and Cameroon. In 2012, Nigeria went over France to become the first trading partner of Ca- meroon. Though since then, the advent of the terrorist group Boko Haram and other rebels in the gulf region has greatly affected trade between the two countries, the volume of trade still remains very important. Recent statistics show that in 2015, Cameroon exports to Ni- geria represented 42.36 Million US dollars and imports stood at 731.74 Million US dollars. Though Cameroon has a nega- tive trade balance with Nigeria, Nigeria remains a privileged trade partner for Cameroon and there is hope that with the trade agreement signed between the two countries in 2014 and the completion of the tarring of the Bamenda-Enu- gu 433 Km road, the volume of transactions will increase for the mutual benefit of both countries. How has the devaluation of the Naira affected trade links with Cameroon which happens to be one of Nige- ria’s major trade partners? Devaluation means the voluntary reduction of the price of one currency in terms of another. The recent devaluation of the Naira by abandoning the fixed exchange rate regime which pegged the value of the Naira to 197 Naira per US dollar, and floating the Naira in June 2016 lead to sharp depreciation of the Naira to 314 Naira per US dollar. This has as effect to in- crease the price of Nigerian imports and to reduce the price of its exports. This in- tends to reduce its imports and promote its exports so as to correct its trade deficit. This affects trade with Cameroondirectly as Nigerian exports to Cameroon will increase as they are now cheaper and Nigerian imports will reduce as they will become expensive. This will widen the already large trade deficit Cameroon has with Ni- geria though as we earlier said, Cameroonian consumers tend to gain as they will consume a larger variety of goods at cheaper prices. Nigeria is Africa’s most populous nation and a neighbour to Cameroon linked with a vast border line. How can Cameroon ca- pitalise on its proximity and available market in Nigeria to boost the local economy? Nigeria represents a market of more than 170 million in- habitants and a gateway to the economy of the entire ECOWAS zone. Cameroon can profit from this situation by developing the production of the products they already export to Nigeria through the modernisation of its productive structures. This is so because most of the products exported to Nigeria by Cameroon are from the agricultural sector which still remains highly tra- ditional. Also, Cameroon can exploit its natural endowment in the potential of producing hydro-electricity to improve its production capacity so as to export the excess to Nigeria. Interviewed by Roland MBONTEH

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  • avatar
    19months ago

    Die idee ist gar nicht schlecht. Nigeria und Kamerun haben immer viel gemeinsam in Zusammenhang mit trading gehabt. Kamerun hast viel BodenschĂ€tze denen man in Afrika finden kann und davon hat Kamerun dir Name “L'Afrique En Miniature“ Mit die Resource von Kamerun und die Öl von Nigeria beide LĂ€nde können davon was haben. Daumen hoch.

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