Cameroon eConomiC Update

Revisiting the sources of growth Enhancing the efficiency of the Port of Douala

January 2015

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table of Contents iii

table of Contents

AbbReviAtions And AcRonyms ........................................................................................... v

Acknowledgement ..............................................................................................................viii

executive summARy ................................................................................................................. 1

Recent economic develoPments ..................................................................................... 3

Economic developments in 2014 remain positive ................................................................................. 3

…but fiscal performance is still preoccupying… .................................................................................... 4

…and the pace of debt and the external balances raise concerns ....................................................... 6

Medium term prospects are mitigated… ............................................................................................... 8

….and more efforts are needed to boost Cameroon’s growth... ........................................................ 10

Assessing tHe PeRFoRmAnce oF tHe PoRt oF douAlA ..............................................13

The Port of Douala is one of the least efficient of the region… ........................................................... 13

…mainly due to regulation and infrastructure limitations .................................................................. 19

Frontally addressing these infrastructure and regulation limitations will enhance

the efficiency of the Port of Douala ...............................................................................................24

abbreviations and aCronyms v

abbreviations and aCronyms

ASYCUDA AutomatedSystemforCustomsData

BL BillofLading

CEMAC Communauté Economique des Etats de l’Afrique Centrale

(CentralAfricanEconomicandMonetaryCommunity)

CNSS CaissenationaledeSécuritésociale

DIT DoualaInternationalTerminal

GDP GrossDomesticProduct

IMF InternationalMonetaryFund

INS Institut National de la Statistique(NationalInstituteofStatistics)

PAD PortAuthorityofDouala

SNH Société Nationale des Hydrocarbures(NationalHydrocarbonsCorporation)

SONARA Société Nationale de Raffinage (NationalRefinery)

aCknowledgement vii

aCknowledgement

TheCameroonEconomicUpdatesareproducedbya

TeamledbySouleymaneCoulibaly,LeadEconomist

andProgramLeaderforCentralAfrica.OtherTeam

members include Rick Emery Tsouck Ibounde,

Senioreconomist(efficiencyofthePortofDouala)

and Chimene Diane Djapou Fouthe, Consultant

(recenteconomicdevelopments),SylvieMunchep,

Team Assistant. Peter Ngwa Taniform, Senior

TransportSpecialist,FaustinAngeKoyassé,Senior

Country Economist for Cameroon, Odilia Renata

Hebga,CommunicationsAssociate,andAbelBove,

GovernanceSpecialistprovidedguidanceatallstages

ofthework.TheTeamhasbuiltontwoconsultancy

reports prepared by Gaoussou Diarra, Ibrahim

Nguena,andTchapaTchouawou,consultants.The

photosinthisreport(includingonthecover)areto

thecreditofTchapaTchouawou.

Comments received from Birgit Hansl (Program

LeaderandLeadEconomist,ECCU1),GaelRaballand

(Sr. Public Sector Specialist, GGODR), Rachel

Sebudde(Sr.Economist,GMFDR)andErrolGeorge

Graham(SeniorEconomist,GMFDR)aregratefully

acknowledged.

Greg Binkert (Country Director for Cameroon),

Olivier Godron (Country Program Coordinator for

Cameroon)andMarkThomas(PracticeManager,

MFMAFR3),providedguidanceandadvice,andhave

beenaninvaluablesourceofencouragement.The

Teamhasalsogreatlybenefitedfromconsultations

with Cameroon’s key policy makers and analysts,

who provided useful insights, in particular the

following institutions: the BEAC (Bank of Central

AfricanStates),theTechnicalMonitoringCommittee

(CTS),MinistryofEconomyPlanningandRegional

Development, National Institute of Statistics, the

Directorate General of Custom, the National Port

AuthorityandtheSingleWindowforForeignTrade

Operations(GUCE).TheTeamisalsogratefultotheir

colleaguesatthe InternationalMonetaryFundfor

exchangesonthemacroeconomicframework.

exeCUtive sUmmary 1

exeCUtive sUmmary

WiththeseCameroonEconomicUpdates,theWorld

Bankispursuingaprogramofshortandfrequent

reports which analyze the trends and constraints

inCameroon’seconomicdevelopment.Eachissue,

producedbi-annually,providesanupdateofrecent

economicdevelopments,aswellasaspecialfocus

onatopicalissue.

The Cameroon Economic Updates aim at sharing

knowledge and stimulating debate among those

interestedinimprovingtheeconomicmanagement

ofCameroonandunleashingitsenormouspotential.

Thenotestherebyofferanothervoiceoneconomic

issuesinCameroon,andanadditionalplatformfor

engagement,learningandexchange.Pursuingthe

workstartedwiththeseventheditiononthetheme:

RevisitingthesourcesofgrowthinCameroon,this

eighteditionoftheCameroonEconomicUpdatelooks

attheefficiencyofthePortofDouala,themainentry

forimportstoCameroonandtwootherlandlocked

countries(CentralAfricanRepublic&Chad)ofthe

CEMACregion.

Growth is projected to remain strong in 2014 at

5.3percent,slightlylessthanthe5.6percentreached

in 2013, in spite of the gloomy global economic

environment,declininginternationaloilprices,and

insecuritycrisisintheFarNorthregionofthecountry.

Thisismainlyduetothestrongerperformanceofthe

oilsector,projectedtogrowat13.5percentagainst

8.5percentin2013.Withthenon-oilsectorexpected

tomaintainitscurrentperformanceoverthemedium

term,GDPgrowthisprojectedtoaverage5percent

over the next five years. Although commendable,

these rates still remain below the Government

objectivessetintheStrategicDocumentforGrowth

and Employment over the period 2010-2020.

AdditionaleffortsareneededtounleashCameroon’s

fullpotential.

Oneareathatrequiresanaccelerationofreformsis

tradefacilitation,especiallytheefficiencyofthePort

ofDoualawhichaccountsforatleast95percentof

thegoodsexportedfromandimportedtoCameroon.

As the natural hub for the Central African region

givenitsstrategiclocation,inefficienciesatthePort

ofDoualarepresentsamajorconstrainttogrowth.

ThePortofDoualaisconstrainedbyalongwaiting

timeattheentrygateaswellasalongdwelltime.

ImprovingthemanagementoftheportofDoualato

significantlyreducecargodwelltimeandensuring

its complementarity with the ports of Kribi and

Limbe will be essential for Cameroon’s external

competitiveness.

BuildingontworeportsoncargodelaysatthePort

of Douala by the economic and transport teams

of theWorldBankaswellasadditional interviews

ontheground,thiseightheditionoftheCameroon

EconomicUpdateprovidespolicyrecommendations

onhowtoimprovetheefficiencyofthePortofDouala.

ThereportshowsthatthePortofDoualaisoneofthe

leastefficientoftheregionandthatinspiteofefforts

deployedoverthelastyears,theobjectivetoreduce

theglobaldwelltimeto7daysattheendofthe1990

has not yet been achieved. The global dwell time

still representsmorethanthreetimesthattarget,

mainly due to: (a) weak coordination of frontline

stakeholders;(b)monopoliesoftheinspectionand

the terminal operators; (c) Ineffective legislation

(d)highshareofinformalandunprofessionalbrokers;

(c)complexityandlengthofimportproceduresand;

(d)physicalandequipmentlimitationsofthePort.

Cameroon eConomiC Update n8 reCent eConomiC developments2 3

Totackletheseconstraintsthataremainlystructural,

thereportrecommendsaboveall thepreparation

andadoptionbyallstakeholdersofacomprehensive

structural reform plan based on an independent

audit of the key choke points in any area of port

operations.Othersoptionstoimprovetheefficiency

ofthePortofDoualainclude:therevisionofthelegal

frameworkgoverningthePort,theimprovementof

the awareness of importers and brokers on trade

procedures,theaccelerationofthemodernization

ofthePortofDouala,andtheimprovementofdata

collectionandanalysisoftradefacilitationstatistics.

The report recognizes that implementing these

reforms will require building consensus among

various stakeholders and also overcoming the

statusquopracticesandbehaviorsprevailingwithin

thePort.

reCent eConomiC developments

Economic developments in 2014 remain positive…

Growth

GDPgrowthrateisprojectedtoreach5.3percentby

theendof2014inspiteofthegloomyglobaleconomic

environment, declining international oil prices,

insecuritycrisisintheFarNorthregionofthecountry

andthelowerthananticipatednationaloilproduction

for2014(figure1.1).Cameroon’seconomystillbenefits

from the positive dynamic observed in past years

withgrowthincreasingfrom3.2percentin2010to

5.6percentin2013.Thisperformanceaccountsfor

thestrongerperformanceintheservicesectoranda

notableprogressinthecommissioningofnewdams

andthermalplantsto improvethequantityofand

accesstoelectricpower.

The tertiary sector, which benefited from the

momentumoftheprimaryandsecondarysectors,

remainsthemaindriverofgrowthwitha2.4percent

contribution. This contribution would have been

higherintheabsenceofthesecuritycrisisinthefar

north.Indeed,thisyear,thetertiarysectorsuffered

fromtheclosingofbordersatAmchidéandFotokol

intheFar-NorthregionandatGaroua-Boulaiinthe

East region, which has negatively impacted trade

betweenCameroonanditsneighborsNigeria,Chad

andCentralAfricaRepublic.

The performance of the primary sector has been

mitigated.The2013-2014cocoacampaignrecorded

adeclineof9.9percentcomparedtotheprevious

campaign due to the declining yield of aging

plantationsandproducers,difficultaccesstohigh

qualitymaterialsandtheadverseeffectsofclimate

change. Agro-pastoral activities dropped due to

increasinginsecurityinthenorthandtheeast.On

the other hand, wood production increased by

13.7percentduringthefirsthalfof theyear2014.

Overall,commoditiesexportsslightlydeclinedduring

thefirstninemonthsof2014(year-on-year),except

forwood,aluminumandcoffee(figure1.2).

The secondary sector performed well during the

firsthalfoftheyear2014thankstothe increase in

energyproduction.ThenewKribiGasthermalPlant

figUre 1.2: export performance, 2014 (end-sept) (percentage Change in volume)

-40 -20

0 20 40 60 80

100 120 140

Coffee Logs andwood

products

Cocoa Bananas Aluminium Cotton Rubber

2014 (End-Sept)

Sources: CustomsandWBstaffcalculations.

figUre 1.1: sectoral Contributions to gdp growth, 2008-2014(est.) (in percent)

-1 0 1 2 3 4 5 6

2008 2009 2010 2011 2012 2013 2014(Est.)

Oil Primary sector

Secondary sector (excl. oil) Tertiary sector

GDP growth

Sources: INS,MINFIandWBstaffcalculations.

Cameroon eConomiC Update n8 reCent eConomiC developments4 5

hasincreasedby25percentthenationalproduction

to 676, 4 Mwh in 2014. Construction is projected

togrowat7percent, ledbytheaccelerationofthe

governmentmajorinfrastructureprojectsparticularly

inroadconstructionandrehabilitation,andtheentry

intothemarketoftwonewcementproducers:CIMAF

and DANGOTE. However some construction sites

(especiallyroadsMaroua-Mora,Dabanga-Kousserie,

Batouri-Youkadouma-Ngoura…)havebeeninterrupted

duetoinsecurityintheFar-NorthandEastregions.

AccordingtotheNationalHydrocarbonsCorporation

(SNH), oil production in 2014 will slow down to

28.2millionbarrelscomparedtoapreviousestimation

of30.4(figure1.3),duetodelayinthedrillingofsome

new fields (Tiko, Bodjongo andYabassi) initially

plannedfor2014.Still,oilproductionisprojectedto

growby13.3percentin2014.

Inflation

TheinflationrateremainedbelowtheCEMAC3.0per

centconvergencecriteriainthefirstsemester(S1)of

2014(figure1.4).Itroseby1.1percentcomparedto

2.3percentinthesameperiodlastyear.

However,theriseinpriceunevenlyspreadsacross

the county’s territory (figure1.5). During the first

halfof2014comparedtothesameperiodlastyear,

inflationwaslowestinBamendaandEbolowawith

averageratesat-0.2and0.6percentrespectively.

PricepressureswerehighestinBertoua(Eastregion)

at 2.1 percent. This situation resulted partly from

therisingdemandofgoodsledbythepresenceof

refugeesfromCentralAfricanRepublic.

Recentchangesoffuelpricesatthebeginningofthe

secondsemesterhavestartedto impactthefood

andtransportinflationpace.InJuly,theinflationin

thetwomajorcitiesYaoundéandDoualaroseby2.4

and2.6percentrespectivelyowingtotransportprice

increasingby14.2and12.6percentrespectively.

…but fiscal performance is still preoccupying…

Thefiscalperformancedeterioratedduringthefirst

halfof2014,withhighcostofoilsubsidiescontinuing

toweighontheStatebudget.Indeed,asinthepast,

in order to balance the budget, the government

under-budgetedfuelsubsidiesatCFAF220billion

in2014,comparedtotheprojectedCFAF450billion

(about3percentofGDP).Toaddressthisproblem,

a presidential decree increasing fuel prices was

issuedonJuly1st2014.Thepriceofgasolineand

dieselincreasedby15percentwhilethatofdomestic

gasincreasedby8percent.Cameroondisplaysthe

highestfuelpricesamongoil-exportercountriesof

thesub-region(figure1.6).

Duringthefirstninemonthsof2014,therevenues

roseby12.7percentcomparedtothesameperiodin

2013,owingtoan18percentincreaseoftaxrevenues.

This performance should be contrasted with the

sharpdecreaseinoilpricepassingbelow$70/bbl

inDecember2014,anewcontextthatwillcertainly

affectoilrevenuescollected.

Throughoutthesameperiod,expendituresincreased

by 7 percent, leading to an overall deficit of 1.9

percentofGDP(table1.1).About47percentofthe

capitalspendingwasfundedbyexternalresources,

especiallygovernmentborrowingonprojects.

figUre 1.6: prices of fuel,selected Countries July 2014, Us$/liter

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

Cameroon Congo Gabon Tchad Equatorial Guinea

Gasoline Diesel

Sources: CEMACmembercountries.

figUre 1.3: oil production 2009-14 (in mio barrels)

15

17

19

21

23

25

27

29

2009 2010 2011 2012 2013 2014

SNH projections

Sources: SNH.

figUre 1.5: inflation rate by major City 2014 (s1-o-s1 Change in percent)

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

Bam

enda

Ebol

owa

Buéa

Garo

ua

Mar

oua

Yaou

ndé

Natio

nal

Ngao

undé

ré

Bafo

ussa

m

Doua

la

Berto

ua

Sources: INSandWBstaffcalculations.

figUre 1.4: selected prices, 2013-2014(s1) (y-o-y Change in percent)

-1.00 0.00 1.00 2.00 3.00 4.00 5.00 6.00

Jan-

13

Feb-

13

Mar

-13

Apr-

13

May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

13

Oct-

13

Nov-

13

Dec-

13

Jan-

14

Feb-

14

Mar

-14

Apr-

14

May

-14

Jun-

14

Total (Headline) CPI Food Price Index Fuel Price Index

Sources: INSandWBstaffcalculations.

table 1.1: fiscal performance, 2013-2014 (in percent of gdp)

2013 2014 2014 2014

Est. Budget End-Sept Proj.

Revenue and grants 18 17.1 13.4 17.6

OilRevenue 4.8 4.6 2.9 4.0

Non-oilRevenue 12.8 12.2 10.3 13.2

Directtaxes 3.5 — 3.1 3.6

Specialtaxonpetroleumproducts 0.8 — 0.6 0.8

Othertaxesongoodsandservices 5.8 — 4.4 5.9

Taxesoninternationaltrade 2.0 — 1.7 2.2

Non-taxrevenue 0.8 — 0.6 0.7

Grants 0.3 0.4 0.1 0.4

total spending 21.9 19.6 15.3 22.7

CurrentSpending 14.6 13.2 10.4 15.1

Wagesandsalaries 5.4 5.4 4.0 5.4

Goodsandservices 4.6 4.1 3.1 4.8

Subsidiesandtransfers 4.2 3.4 3.0 4.5

Fuelsubsidies**** 1.7 1.4 — 2.1

Pensions 1.1 1.0 0.8 1.1

Other 1.4 1.0 — 1.3

Interest 0.4 0.2 0.3 0.5

CapitalSpending 7.3 6.4 4.9 7.5

overall balance** –4.4 –2.5 –1.9 –5.1

Non-oilprimarybalance*** –9.0 –7.3 –2.1 –9.2

Sources: TableaudeBorddesFinancesPubliques,WBstaffcalculations.**doesnotincludepaymentofarrears.***inpercentofnon-oilGDP.**** Figuresfor2013isacashpaid;doesn’tincludetheresttopaytotheSONARA(1.3percentofGDP).projectionsfor2014takeintoaccounttheeffectsofreductioninfuelsubsidiesduetotherecentincreasingoffuelprices,sothefuelsubsidiesmovedfromabout3percentofGDPin2013to2.1percentofGDPin2014.

Cameroon eConomiC Update n8 reCent eConomiC developments6 7

The budget saving of about CFAF 165 billion

(1.1 percent of GDP) resulting from the reduction

ofoilsubsidiesisexpectedtobepartiallyabsorbed

by the reduction of the special tax on petroleum

products and global tax for transporters and a

CFAF30billionincreasesofpublicservantsalaries.

Overall,thegovernmentwillsaveabout0.9percent

ofGDPin2014,withtheoilsubsidiesprojectedto

decreasefromCFAF450billiontoCFAF330billion.

Furthermore,theinsecurityfacedintheFar-North

of the country due to regular attacks from Boko

Haramandthepreventivemeasurestofightagainst

Eboladiseasewillalsoincreasepublicexpenditure.

Accordingly, total expenditure will increase to

22.7percentofGDPfrom21.9percentofGDPin2013.

Totalrevenuewhichwillbeaffectedbythedownfallof

internationaloilpricesobservedsincethebeginning

ofsecondhalfoftheyear2014(figure1.7)isexpected

todeclineto17.2percentofGDPcomparedto17.6

percentin2013.Consequentlytheoverallfiscaldeficit

(commitmentbasis)isestimatedtowidenbytheend

of2014,reaching5.1percentofGDPcomparedto4.2

percentofGDPin2013.

…and the pace of debt and the external balances raise concerns

Debt

Thanks to the debt cancellation under the

HIPC-Initiative, the public debt of Cameroon is

currentlyatalowlevel.Thestockofpublicdebtis

estimatedat20percentofGDPinthefirsthalfof

2014,withanexternaldebtof14.6percentofGDP

and a domestic debt of 5.4 percent of GDP. The

government has been using this fiscal space to

externallyfinanceaseriesofinfrastructureprojects

toaddressthecountry’sinfrastructureneeds.The

externalfinanceneedof thegovernment for2014

wasestimatedat3.8percentofGDP.Ifthistrendis

maintained,Cameroonwillexceeditsself-imposed

debtlimitof35percentofGDPby2018,reaching40

percentby2020(figure1.8).Theshareofdomestic

debtisalsoprojectedtorise,from7percentin2013

to20percent in2019.Althoughtheexternaldebt

remainssustainable,theacceleratedpaceofdebt

accumulation in a context of relatively high fiscal

deficitsisworrisome.ItisexpectedthattheNational

Comity of Public Debt will closely monitor the

government’sdebtstrategyoverthecomingyears.

External Balance

Duringthefirstninemonthsoftheyear2014,thetotal

exports slightly increased compared to the same

periodin2013,thankstotheincreaseinoilexports.

However,non-oilexportsdecreasedby7percentin

value,wideningthenon-oiltradedeficitby10percent

(table 1.3). The overall trade deficit increased by

8percentcomparedtothesameperiodin2013.

Non-oilexportsareprojectedtomaintainthesame

paceovertheyear2014mainlyduetosomecurrent

bottlenecksattheportofDouala,andimportswill

declineby0.2percentcomparedto2013(table1.2).

Consequently, thetradebalancewilldeepenfrom

-0.7percentofGDPin2013to-1.4percentofGDPin

2014.Atthesametime,thecurrentaccountdeficit

(excludinggrants)willincreaseto4.7percentofGDP

from4.4percentin2013.

figUre 1.8: actual and projected stock of public debt, 2005-2019 (in percent of gdp)

0

10

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

(S1)

2015

2016

2017

2018

2019

2020

20

30

40

50

60

External public debt Domestic public debt

Sources: CAAandDebtSustainabilityAnalysis.

figUre 1.7: value of oil exports tied to international oil price, 2014 (Q1-Q4)

0

1

2

3

4

5

0

50

100

150

200

250

Quarter1 Quarter2 Quarter3 Quater4

Oil Exports in million of barrels International Oil price USD/Bbl Value of oil exports in billions of CFAF

Source: SNHandstaffcalculations.

box 1.1: economic impact of the Conflict in the far-north region

RecentdevelopmentsinNorthernCameroonhavepointedtoanalarmingdeteriorationinsecurityconditions

duetothepresenceofBokoHaram.Thenatureandreasonsofthisconflictaredifficulttocapture,butthe

economicimpactsarevisible.Duringtheyear2014,theinsecuritycrisisintheFar-Northhasnegatively

affectedagricultureactivitiesintheregionandtradewithneighbors.Thecrisisdisruptstheagricultural

schedulesandsomefamershaveabandonedtheirfields;thenetworkofdistributionofinputsandthe

supplyingofbordermarketshavealsobeendisturbed.Inaddition,theinaccessibilityofbordermarketsin

Nigeriahascausedanoversupplyandadeclineoffoodpricesandlivestockproductspricesinlocalmarkets

intheFarNorth.TheclosingofbordersatAmchidéandFotokolintheFar-Northregionhasleadto(i)the

scarcityofproductsfromNigeriaparticularlymotorcycles,spareparts,softdrinksand(ii)difficultiesto

sellsomeproductstoChad,CentralAfricanRepublicandNigeria.Finally,thebanningofmotorcyclesinthe

regionhasdisrupteddistributionservicestolargeconsumptioncenters.

Source: MINEPAT,DAPE.

table 1.2: trade balancre 2013 (Jan-sept), 2014 (Jan-sept) volume in million of tonnes, value in billion of Cfaf

2013(End-Sept) 2014 (End-Sept) 2013(Sept)o 2014(Sept)

Volume Value Volume Value Volume Value

Exports 4079 1542.4 4816.6 1638.7 18% 6%

Oil 2153.5 711.8 2808.3 860.5 30% 21%

Non-oil 1925.5 830.6 2008.3 775.2 4% -7%

Imports 5520.8 2480 5884 2652.8 7% 7%

Oil 998.8 435.1 1315.3 544.8 32% 25%

Non-oil 4522 2044.9 4568.6 2107.9 1% 3%

TradeBalance –937.6 –1017.1 –8%

Non-oilTradeBalance –1214.3 –1332.7 –10%

Source: CameroonCustoms.

table 1.3: balance of payments, 2014 (in percent of gdp)

2013 2014 (Proj.)

current account balance –3.8 –4.2

Tradebalance –0.7 –1.4

Oilandoilproducts 10.5 10.1

Non-oilexports(goods) 10.1 9.9

Imports(goods) 21.2 21.4

Services(net) –2.1 –2.1

Income(net) –2.1 –1.9

Transfers(net) 1.0 1.2

Financial account balance 3.2 4.1

Officialcapital 3.1 2.9

Long-termborrowing 3.5 3.6

Amortization –0.5 –0.8

Non-officialcapital(net) 0.2 1.1

Oilsector 0.4 1.2

Non-oilsector -0.2 0.1

overall balance –0.3 –0.1

Source: IMF.

Cameroon eConomiC Update n8 reCent eConomiC developments8 9

Medium term prospects are mitigated…

Oilproductionisexpectedtocontinueitsupwardtrend

overthecomingyears.TheNationalHydrocarbon

Company(SNH)projectsa12.9percentincreasein

productionin2015,followingthestartofproduction

in the Dissoni oil field discovered last year, the

reactivationofproductioninLokéléoilfieldandtheuse

ofrecoverytechniquestooptimizetheproductionof

maturefields(RiodelRey).Additionallyfournewfields

(Eroko,Tiko,Bodjongo,andYabassi)areexpectedto

bedrilledbytheendof2015.However,SNHprojects

apeakinproductionfor2015andadeclineforthe

followingyearsunlessongoingexplorationsleadto

newproduction.Inthemediumtolongterm,natural

gascouldfillthisgap,providedinvestments,suchas

a liquefiedgasterminal,makes itsexportfeasible.

The positive prospect on the production side is

counterbalancedwiththesteadydeclineincrudeoil

price.Indeed,afterfluctuatingaroundUS$108per

barrelduringthefirstsevenmonthsof2014,theprice

ofcrudeoilhashitafour-year lowandiscurrently

belowUS$70perbarrel—approximatelya31percent

declinesinceJune.

The Kribi deep sea port is almost completed. In

July2014aChineseshipwithtwotugswasableto

accessthedock,indicatingthattheportcanreceive

heavyvesselsfromnowon.Whiletheconstruction

oftheportisestimatedat99percent,delayswith

connectinginfrastructure,especiallytheaccessroad,

theelectricitylineandtheopticfibercable,aswellas

thesetupforCustomsmightimpactthestartoffull

operations.TheproblemsattheportofDoualalast

yearhaveshownthatitrepresentsamajorbottleneck

forinternationaltrade.Onceoperational,thenewport

inKribicouldhelpinboostingCameroon’sexports.

Onpower,theLomPangarHydropowerdamisthe

centerpieceoftheGovernment’sstrategytoensurethe

mediumtolongtermelectricitysupplyinthecountry.

Besidestheplantthatwillsupply30MWtocoverthe

energyneedsfortheeasternregionofCameroon,Lom

PangarallowstheregulationoftheflowoftheSanaga

indryseasons.Itpavesthewayfortheconstructionof

newpowerplantsontheSanagaBasintotapthefull

potentialofthisbasin.TheLomPangarHydropower

projectwill thereforecomplementthemultitudeof

ongoingorcompletedenergyprojects,includingthe

KribipowerplantandtheMekinandMemve’ledams

andbringthetotalenergysupplytoaround1,560MW

by2017.Thechallengewillbetomakethiscapacity

availablewhereitcanbemoreproductive.Assuch

thetransportofenergytomatchsupplyanddemand

isessential,andasurveyoflargeenergydemands,

particularlyfromtheindustrialsectorshouldbedone,

andtheconstructionoftransport infrastructureto

theseareasshouldbeplanned.

Apart from these projects of dam constructions

which could increase the energy supply in the

country,Table1.4listsotherinfrastructureprojects

which could improve in the medium term the

country’s production backbone and boost its

domestic,regionalandinternationaltrade.

The third telecom operator, Nexttel, is on board

since September 2014. The fourth one, Camtel,

hasreceived its licenseand isabout to launch its

activities.Consequently,increasingcompetitioninthe

telecommunicationsectorcanbeexpected,raising

expectationsintermsofgoodqualityofservicesat

lowerprices.Theeffectiveimplementationofthe3G

licensewillboostthetertiarysectorwhichremains

oneofthemaindriversofgrowth.

table 1.4: Cameroon’s major infrastructure projects

Projects

Estimated Cost (Billion

of CFAF)Operational

Timeline

Kribideepseaport 244 2015

LomPangarHydropowerdam

220 2016

Mem'veledam 380 2017

Mekindam 26 2015

HighwayYaounde-Nsimalen 60 2015

HighwayDouala-Yaounde 241 2017

AsphaltingoftheroadKumba-Manfé

87.5 2016

SecondbridgeontheWouri 120 2017

EntryEastandWestofDouala

99.2 2016

Source: MINEPAT.

External risks

Theprospectsforworldmarketsaremitigated.The

growth forecast for the world economy has been

reviseddownwardto3.3percentfor2014,0.4percent

lower than in the April World Economic Outlook.

Theglobalgrowthprojectionfor2015waslowered

to3.8percentowingtoaworseningofgeopolitical

tensions,areversalofboththeriskspreadandthe

volatility compression in financial markets, the

stagnationandthelowpotentialgrowthinadvanced

economies, and a decline in potential growth in

emergingmarkets.

DespitetheeasingofinterestratesbytheEuropean

CentralbankinJuneandSeptember2014,growth

is expected to remain lackluster and fragile. GDP

rateisforecastedat0.9percentin2014,downfrom

1.1percentaspreviouslyprojected.TheEuroZone

Economic Sentiment Indicator was stable since

January2014,showingthatconfidenceintheEuro

Zone is also stable (figure 1.9). At the same time,

some of Cameroon’s major trading partners like

ChinaandPortugalareprojectedtoimportlessthan

the year before (figure 1.10). Moreover, the main

destination countries of Cameroon’s exports are

Europe and Asian countries (table1.4). Therefore,

thedownturnineconomicactivitiesintheEurozone

andAsiaisexpectedtonegativelyimpactCameroon’s

exports,especiallycommodities.

figUre 1.9: euro-zone – economic sentiment indicator, 2012-2014 (long-term average = 100)

80

85

90

95

100

105

Feb-

12

Apr-

12

Jun-

12

Aug-

12

Oct-

12

Dec-

12

Feb-

13

Apr-

13

Jun-

13

Aug-

13

Oct-

13

Dec-

13

Feb-

14

Apr-

14

Jun-

14

Aug-

14

Oct-

14

Source: EuropeanCommission.

Domestic challenges

Considering the fall in international oil prices

internationaloilpricewhichisexpectedtocontinue

over the coming months, and its impact on oil

revenues(whichcountforabout25percentoftotal

revenues),thegovernmentisencouragedtocontinue

thereductionoffuelsubsidiesandtheelimination

of fiscal expenditures as it continues to handle

strategicallythesecuritychallengeinthefarnorth

anditsimpactsontheeconomy.

Another issue that requires attention is the high

level of poverty. Despite a decade of economic

growth,povertyratesinCameroonremainalmost

unchangedwithapopulationgrowthat2.5percent.

Aftershowingalargedeclinebetween1996and2001,

povertytrendshaveremainedstatic.From1996to

2001,theincidenceofpovertyinCameroondropped

figUre 1.10: actual and projected import volume, main trading partners, 2013- 2015 (variation in percent)

-2 0 2 4 6 8 10

France

Spain

Netherlands

Portugal

China

2013 2014 2015

Source: IMFWEOOctober2014.

table 1.5: Cameroon, main export destination countries

Exports goodsMain export

destination countries

Coffee Italy,Portugal,France

Logsandwoods Italy,China,France

Cocoa Germany,Malaisie,Netherland

Bananas France,Belgium,UnitedKingdom

Aluminium Netherlands,France,Italia

Cotton China,Malaisia,Turkey

Rubber Spain,China,Netherlands

Source: CameroonCustoms

Cameroon eConomiC Update n8 reCent eConomiC developments10 11

from53.5percentto40.2percent,whilethe2007

datashowedapovertyincidenceof38.7percent.This

trendisinlinewiththetrendofpercapitaGDPover

2003-2013(figure1.11).Whilepercapita incomes

haveexpandedbyabout45percentinlowincome

countriesand inSub-SaharaAfrica(exceptSouth

Africa) and even by 65 percent in middle income

countries,percapitaincomehasalmoststagnated

in Cameroon, growing by a mere 9 percent over

theperiod.

Moreover,Cameroonstillfacesamajorinfrastructure

gap, partly because of its low investment over

thelast20years.This iswhythegovernmenthas

pushed an investment agenda over the recent

years.Takingadvantageofitslowdebtlevelsafter

thedebtcancellationundertheHIPC-initiative,the

government has invested in infrastructure, such

asroads,electricityproductionandtheKribiport.

The acceleration of investment, however, poses

the problem of decreasing quality of investment.

Asthenumberofexecutedprojects increases,so

does the risk of investing in projects that do not

maximizereturns,asinstitutionalcapacitytoassess

thereturnsoninvestmentarelimited.Therefore,an

overarchinginvestmentstrategywithclearpriorities

isindispensabletoavoid‘opportunistic’investments

inprojectsthatarenotthemostpertinentorwith

suboptimal financing conditions. Public Private

Partnerships (PPPs) might also be a source of

financingfornewinfrastructureprojects,butonly

if future costs are accounted for in a transparent

way and if it is more favorable than turning to

capitalmarkets.

….and more efforts are needed to boost Cameroon’s growth...

Inadditiontoinadequateinfrastructure,economic

per formance is also hur t by governance

shortcomings. The business climate is not yet

conduciveforgrowth.Intermsoftheeaseofdoing

business inCameroon,thecountryscoredlowon

internationalbusinessclimatecomparisons,such

as the Doing Business ranking. It lost ten points

figUre 1.11: per Capita gdp growth, 2003-2013 (index 2003=100)

100 110 120 130 140 150 160 170

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Cameroon Low income

Middle income SSA (w/o South Africa)

Sources: WorldDevelopmentIndicatorsandWBstaffcalulations.

moving from 148th to 158th over 169 countries

accordingtoDoingBusiness2015.Besidesthetopic

of“ProtectingMinorityInvestors”whereCameroon

has gained thirteen (13) points, its rank on other

topicsstayunchangedorlow(Table1.6).“Dealing

withConstructionpermits”(lostof34points)isone

of the bottlenecks in the ease of doing business.

EvenifCameroonmadeiteasierbydecentralizing

the process for obtaining a building permit and

by introducing strict time limits for processing

theapplicationaswellas issuingthecertificateof

conformity,dealingwithconstructionpermitremains

morecomplexbytheintroductionofnotificationsand

inspectionrequirements.

Inanefforttoattract investment,thegovernment

offers fiscal incentives to businesses through its

newinvestmentlaw.However,asarecentstudyby

theMinistryofFinanceonthecompetitivenessof

secondarysectorcompanieshaspointedout,fighting

corruption, cutting red tape and reforming the

judiciarysystemareimportanttobusinessowners.

Thispoorbusinessclimatecouldnegativelyaffect

capitalaccumulationorprecludethereallocationof

productionfactorstotheirmosteffectiveusesand

hencemaintaingrowthbelowthetargetsformulated

in the 2009 Strategy Document for Growth and

Employment(DSCE).Thissituationcallsforrenewed

attentiontothesourcesofgrowthinCameroon-to

identifypolicyareasthatcanhelpCameroonreach

the economic growth levels that are needed to

sustainablydevelopthecountryandreducepoverty.

table 1.6: ease in doing business in Cameroon

Topics DB 2015 Rank DB 2014 Rank change in Rank

StartingaBusiness 133 127 –6

DealingwithConstructionPermits 166 132 –34

GettingElectricity 52 52 Nochange

RegisteringProperty 172 172 Nochange

GettingCredit 116 111 –5

ProtectingMinorityInvestors 117 130 13

Payingtaxes 181 178 –3

TradingAcrossBorders 160 160 Nochange

EnforcingContracts 159 159 Nochange

ResolvingInsolvency 123 119 –4

Source: http://www.doingbusiness.org/data/exploreeconomies/cameroon.

Oneareathatrequiresanaccelerationofreformsis

tradefacilitation,especiallytheefficiencyofthePort

ofDoualawhichaccountsforatleast95percentof

thegoodsexportedfromandimportedtoCameroon.

As the natural hub for the Central African region

givenitsstrategiclocation,inefficienciesatthePort

ofDoualarepresentsamajorconstrainttogrowth.

Therefore,anefficientPortofDoualaisakeysource

ofgrowth,asitwouldensurethatimports(including

intermediate goods for domestic production) are

cheaper in the domestic market and exports are

more competitive on foreign markets. The next

chaptersuggestssomeoptionsonhowtoimprove

theefficiencyofthePortofDoualaonthebasisof

theanalysisofimportedcargodwelltimesandthe

institutionalandregulatoryframeworkgoverningthe

managementofthePort.

assessing tHe performanCe of tHe port of doUala 13

assessing tHe performanCe of tHe port of doUala

TheportofDoualaisconstrainedbyalongwaiting

time at the entry gate as well as a long dwell

time. Improving the management of the port to

significantlyreducecargodwelltimeandensuring

its complementarity with the ports of Kribi and

Limbe will be essential for Cameroon’s external

competitiveness.Anabundanteconomicliterature

(Wilson et al, 2003a, 2003b, 2004; Clark et al,

2004) has demonstrated that poorly-performing

portscanstronglyreducetradevolumesandmay

haveagreaterdampeningeffectontradeforsmall,

less-developed countries than many other trade

frictions and that port efficiency and services

infrastructure have a positive impact on African

trade(Djinkeetal,2008).Indeed,tradeandtransport

facilitation has become a vital tool in the process

of integrating markets and the performance and

efficiencyofaPorttohelplowertradetransaction

costshencereducingthemarginbetweendomestic

andinternationalpricestobenefitconsumersand

producers.

On average, the global importing time (from

departureinorigincountrytocargoexitattheport)

isestimatedat42days(39forcontainersand56for

non containers). 50 percent of this time is due to

maritimetransportandtheotherhalftotheglobal

cargodwelltime(fromvesselarrivaltocargoexit)

estimatedin2014at22days.Thisaveragevaluehas

beenquitestableinthelast10yearsdespitestrong

andconsistentgrowthintraffic.Someconsequences

oftheselongdelaysarethecrowdingeffectinterms

ofredirectionofsomevesselstoneighboringports,

notablytheportofPointeNoire intheRepublicof

Congo. In addition, long cargo dwell times largely

contributetothepoorrankofCameroon(133out

of166countries) inthe2014WorldBank logistics

performance indicators.Buildingontwomissions

that collected data on cargo delays at the Port of

Douala1andcomplementarydiscussionswithport

stakeholdersandafieldvisitofthePort,thischapter

assessestheefficiencyofthePortofDoualathrough

a disaggregated analysis of cargo dwell time, the

mainreasonsofcargodelaysattheportofDouala

andthenrecommendsmeasurestoimprovethePort

efficiencyandcompetitiveness.

The Port of Douala is one of the least efficient of the region…

Measuring the inefficiency of the Port of Douala

At least two indicators can beused to assess the

efficiencyofaport.Thetimespentbycargoswithin

the port or its extension and payments made by

shippingcompaniesortraderstoexitthecargos.In

thischapter,basedondataandinformationavailable,

theefficiencyorinefficiencyofthePortofDoualais

analyzedbasedonthecargodwelltime.Moreover,

1ThefirstmissionwasconductedbyGouassouDiarraandTchapaTchouawou,consultantsfortheWorldBank.Theobjectiveofthismissionwastoperformanin-depthdatacollectionandanalysistodeterminetheactualdriversoflongcargodelaysattheportofDoualainCameroon.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala14 15

since over 80 percent of the traffic at the Port of

Douala isrelatedto imports2,theefficiencyofthe

Portisanalyzedonthebasisofitsimportoperations

performance.Also,thestatisticalanalysisofcargo

dwelltimeindicatorshasbeendoneonlyforimport

cargoessinceonlythiscategoryofoperationswere

tradedfromthemanifesttothedeclarationtables

proposed by the Automated System of Customs

Data(ASYCUDA).Informationonexportdeclaration

was not filled during the period analyzed by the

presentanalysis.3Theanalysisisbasedonlyoncargo

282.4%ofthe141000cargoesrecordedbythecustomsauthorities in2013were importedand53.64%ofthemwerecontainerized.65%of totalcargoesregistered in2013forlocalimport,around15%fortransit,and20%forexport.ThetrafficinthePortofDoualahasincreasedupto9,84%from2012to2013.ThevesselsdischargedattheportofDoualacomeessentiallyfromAlgeciras(44%),Antwerp(21%),LasPalmas(9%)andSingapore(5%).EachvesselhavingmadeastopattheportofDoualaduring2013hasunloadedonaverage370containers.CargoesinthesevesselsaremainlyoriginatedfromFrance(23%),Belgium(16%),China(16%),ArabEmirates(10%),USA(7%)andGermany(4%)andthemaindestinationsofthesecargoesare:Cameroon(84%),Chad(13%),andRepublicofCentralAfrica(1%).

3According to Cameroonian customs, this issue wassolvedsinceMay2014throughareformwhichrequeststogenerateforeachexportdeclarationasingleBillofLading(BL)whichislinkedtoamanifest

discharged and assessed in 2013 which excludes

cargodischargedin2013butassessedin2014for

instanceorcargodischargein2012andassessedin

2013.Thereforetheresultsshouldbeinterpretedwith

thisrestrictioninmind.

Theglobaldwelltimemeasuresthetimebetweenthe

vesselarrivalordischargeandtheexitofcargoout

oftheport.Thisindicatoraimsatappraisingthejoint

performanceofallstakeholdersinimportoperations.

Itiscomposedof3components:theoperationaldwell

time,whichrefers to theperformanceofphysical

operations;thetransactionaldwelltime,whichrefers

totheperformanceofclearanceformalities;andthe

storage dwell time, which refers to the voluntary

storageofcargointhecontaineryardaspartofa

widerinventorymanagementstrategy.

Variousindicatorsofcargodwelltimecanbeused

toassesstheperformanceofdifferentstakeholders

ofimportatthePortofDouala.Thefigure2.1below

presentsthe listof individualoperationdatesthat

havebeenusedtocomputetheindicatorsofcargo

dwelltimeusedinthecontextofthepresentchapter.

Fromthesedifferentdates,severalcombinationsof

calculationarepossible.Wehaveanalyzedwhatwe

considerasthemostrelevantfortheanalysisofthe

box 2.1: the port of doula

Cameroonhasfourautonomousports:theportofDouala,themaritimeportofKribi,theseaportestuary

ofLaminaandtheriverportofGaroua.TheportofDoualaprovidesnear95percentofnationalporttraffic.

ItthuspositionsitselfasthemainportofCentralAfricaandservesneighboringlandlockedcountriessuch

asChad,theCentralAfricanRepublic(CAR)andtheNorthoftheRepublicofCongo.Theregulationsonthe

organizationoftheautonomousportofDoualaaredefinedbyDecreeNo.99/130of15June1999.Built

ontheestuaryoftheWouriRiver,thisportisconnectedtotheoceanbya50kmchanneldredgedtoan

averageratingof-7m.withanannualcapacityof7milliontonstraffic,itconsistsof:26berthson5.5kmlong,

7specializedterminals,15warehouses,65haofopenarea,25kmofrailwaysand20kmofpavedroads.The

containerterminalhasafrontofberthingof700mlongand45mTEUSwidefortrafficfrom1.2milliontons

to105000units.ASingleWindowforForeignTradeOperations(GUCE)wascreatedin2000tocoordinate

andhostinasingle-pointallthestakeholdersintheprocessofimportandexportofgoods.Itisoperational

since2002.SeveralindustrialandcommercialactivitiesoftheDoualaportwereprivatizedin2003and2004:

thecontainerterminalwasgrantedtoDoualaInternationalterminal(DIT),consortiumofleadingoperators

oftheportwhichincludesBolloré(Saga,SDV,SOCOPAO)andMaersk.

Source: http://www.logistiqueconseil.org/.

efficiencyofthePortofDouala.However,itshould

benotedthattherearesomeproblemsrelatedto

theaccuracyofsomedates,notablythevesseldate.

Forinstancewefoundthatforaround10percentof

declared items, the vessel was discharged before

itarrival.Thereforethesedatawereexcludedfrom

theanalysis4.

The global dwell time at the Port of Douala is

estimatedat22daysforthemeanvalueand16days

asamedian.Itishigherfornon-containerizedcargo

(30daysasmeanand21daysasmedian)thanfor

containerizedcargoes forwhichtheaveragetotal

dwell time is20dayswhilethemediandwell time

is15days.Asshown infigure2.2, it isamongthe

longestoftheportsofthecontinentforwhichdata

areavailable.TheaverageglobaltimeatthePortof

Doualais5timeshigherthantheoneofDurban,twice

ofthePortofMombasa,1.5timeofDarEsSalam

Port,exceedsby22percenttheglobaldwelltimeat

thePortofLomeandby10percentthePortofTema.

InmajorportsofAsiaandLatinAmerica,theglobal

cargodwelltimeisonaveragelessthanaweek.

The distribution of imported cargo dwell times

(figure 2.3) shows that 25 percent of all cargoes

have a dwell time higher than 26 days, while for

containerized cargo this value is estimated at

25 days against 34 days for non-containerized

cargoes.Figure2.3alsohighlightsthepresenceof

successive peaks that confirms the existence of

discretionarycargoesclearancebehaviors.Indeed

4Theanalysiswascompletedinfivemainphases:• Collectdetaileddisaggregateddataondwelltimeforthe

portofDouala,• Collectdatafromlogisticsservicesoperators(ofwhich

freightforwarders,customsbrokers,…),toassesstheircostsandservicesprices(aswellastimedata),

• Undertakefirmsurveystoassesstheextentoflogisticsconstraints on importers/exporters, large/small-scalecompanies,traders…,

• Quantitativeanalysisbasedoncollecteddata.

the peak around 11 days can be interpreted as a

psychologicalthresholdlinkedtotheexpirationofthe

legalfreetimeperiod.Theanalysisshowsthataround

1.6 percent of declared items of cargoes remains

withintheportmorethan90days.Forcontainerized

cargo this represents 1.1 percent and 4.6 percent

fornon-containerizedcargo.Thegoodswhichhave

stayedmorethan90daysarethoselikelytobesold

throughpublicauction.

figUre 2.1: Chronological dates Used for the Construction of indicators of Cargo dwell time

1. Date of departure of the vessel

Overall Importing time

MaritimeTransport time

Global Cargo Dwell time

2. Date of the registration of the manifest

3. Date of arrival of the vessel

4. Date of discharge of the vessel

5. Date of starting the process of declaration

6. Date of registration of the declaration

7. Date of assessment of the declaration

8. Date of payment of customs fees

10. Date of exit from the port gate

9. Date of issuing the permit of exit

Source: WorldBank,basedondatafromCamerooniancustoms.

figUre 2.2: average dwell time at selected ports of africa

0

5

10

15

20

25

Durban Douala Lome Tema Mombasa Dar es Salam

Source: WorldBank.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala16 17

figUre 2.3: distribution of imported Cargo dwell time (from discharging vessel to exiting Cargo) in 2013 at the port of douala (% of total items declared)

0 0.5

1 1.5

2 2.5

3 3.5

4 4.5

5

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60

% of total items declared

Dwell time (Number of days)

% o

f ite

ms

decl

ared

Source: WorldBankusingdatafromCameroonianCustoms.

Product, Destination and Broker Specific Assessments

Forvehicles,thedwelltimeisgreaterthan20days

andforrice,maizeandotherscerealsitisestimated

at an average of 56 days. By contrast, for fresh

products and products containing asbestos, it is

estimatedatlessthan6days.Thelegislationseems

to be one of the reasons for long delays for rice

and others cereals. In 2005, in order to facilitate

the country’s supply of rice, the Cameroonian

government allowed an exceptional 90 days free

time(thenormalfreetimeis11days)forriceasthis

commodity is the main imported food consumed

inCameroon(about700,000tonsperyear).This

decisionhasnotbeenreversedsincethen.

Discrepancies on the global time also exist when

we consider countries of destination of cargoes,

typeofbrokers, importersandcustomsregimes.5

Concerningdestinationsofcargos,whilecontainers

goingtoChadhave18daysasglobaldwelltime,it

isrecorded20.3daysforCameroon,27.1daysfor

theRepublicofCongoand44.7forCentralAfrican

Republic(CAR).6Thefactthatpartofcustomsfees

forcargosgoingtoCARarepaidattheportofDouala

largelyexplainsthislongdelay.Sincepartofcustoms

andimportfeesduetoCARarepaidatthePortof

Douala, the difficulties related to the mobilization

of resources to pay customs fees and deposit

necessarilycausedelays.Thisisconfirmedbythe

factthattheaveragetimetakenbythecontainers

goingtoChadislower(18days)thanthetimeofthose

5 three selectivity lanes are used by customs to clear cargo discharged at the port of douala.Theredlaneconsists in physical check using a scanner; the yellowlaneconsistsinadocumentcheckandthebluelaneforwhichthereisnoimmediatecheckasitseekstopromotefacilitationinimportoperations.Thegreenlaneissetforallcargoesafterclearance.In2013,61.2%oftotalcontainershavebeenclearedthroughtheredlane,28.9%throughtheyellowlaneand9.8%throughthebluelane.Fortransitcargothereisnobluelaneandtheredisessentiallytherule.Onlyasmallnumberofimportersarebenefitingthebluelaneundertheagreementofperformancecontract.Thisfacilitationlaneallowsreducingupto1weekthecargodwelltime.

6GaoussouDiarraetal.(2014),P.35.

goingtoCAR(about44.7).IfChadianimportershad

topayaportionoftheirdutiesinDouala,theirdwell

timewouldcertainlyincrease.

Substantial differences also exist between small,

medium and large customs brokers in terms of

average global dwell time. Medium brokers who

control half of the market seem to have lower

global dwell time (19 days) compared to the top

5 largest brokers owning a quarter of the market

(21.24 days) and small brokers (22.54 days). The

poorperformanceofsmallbrokersseemstobedue

totheirlowmasteryofproceduresanddifficultiesto

accessinformationontheitineraryofvesselsand

cargos.Consideringcustomsregimes,theaverage

timefortheredlaneis21days(16asamedian),20for

theyellow(14asamedian)and14daysfortheblue

lane(9asamedian).

Decomposition of the Global Dwell Time

The chronological date presented in figure 2.3

allowsdisaggregationoftheglobaldwelltime.The

figure2.4belowshowstheshareofeachcomponent

of theglobal dwell timeat thePortofDouala and

reveals its main sub-components that should be

targeted: (i) the customs declaration registration

time(fromdischargingvesseltoregisteringcustoms

declaration);(ii)thedeclarationpaymenttime(from

declaration assessment to paying customs dues)

and;(iii)thetimetogetexitpermit(fromdeclaration

paymenttoissuingexitpermit).

figUre 2.4: mean values of the share of each Component of Cargo dwell times within the global dwell time (from arrival to gate exit) in 2013 at douala port, all imported Cargo

0.71

58.34

4.8 1.83

18.54

19.87

7.98 From vessel arrival to vessel discharge

From vessel discharge to declaration registration

From starting declaration to registering declaration

From declaration registration to assessment

From declaration assessment to payment

From declaration payment to issuing exit permit

From issuing exit permit to gate exit

Source: WorldBankusingdatafromCameroonianCustoms.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala18 19

The customs declaration registration time (date

of declaration registration minus date of vessel

discharging) which assesses the performance of

customsbrokersandthequalityoftherelationship

betweenimportersandbrokersisbyfarthemost

importantcomponentoftheglobaldwelltime.Itis

estimatedonaveragearound58percentforoverall

cargoes (figure 2.4), 57 percent for containers

and 64 percent for non-containers. The average

value of this component of dwell time is 16 days

(14daysforcontainersand26fornon-containerized

cargoes)whilethemedianvalueis11days(11days

forcontainersand15fornon-containers).Thethird

quartilevalueis20days(19forcontainersand34

for non-containers). However, for containerized

cargoesclearedthroughthebluelaneandforrice

andmaize, thiscomponent isnotthehighestone

as it represents 38 percent in both cases. These

twocasessuggestadeliberatewillingnesstostore

cargowithintheportandallowstheconclusionthat

alargeproportionofthecustomsdeclarationtime

isnotduetoclearanceformalitiesbuttobehavioral

practices(willingnesstofraud,lackofanticipation,

absenceofrequireddocuments…).Thisdelaymay

be imputed to importers and customs brokers

becausetheregistrationofthedeclarationcannot

be completed if some required documents are

lacking. The responsibility of the pre-shipment

inspector (SGS) is also of concern since many

importersarecomplainingaboutitsbehaviorasa

monopolisticactor.

figUre 2.5: average Customs declaration registration time (in numbers of days)

0

5

10

15

20

25

30

Non -containerized Containerized Overall

Source: WorldBankusingdatafromCameroonianCustoms.

It is worth noting that the discharge of vessels is

delayedbythewaitingtimeattheentryofthePort

that was estimated in 2013 at 5 days on average

with a peak in September (around 10 days). This

delaywhichisanindicatoroftheinefficiencyofport

operatorsintermsofdredgingtheriverandhandling

equipmentsforunloadingandloadingvesselsatquay

isspecifictothegeographicalandlogisticfeaturesof

theportofDouala.Duetothisdelay,someshippers

areusingtheportofPointeNoire(theRepublicof

Congo)totransitanincreasingpartoftheirimport

cargoesgoingtoCameroon.Thepurchaseof4new

gantriesbythecontainerterminaloperator(DIT)in

May2014isexpectedtoreduceit.

The Declaration payment time (Date of payment

of customs duties minus date of declaration

assessment)isanindicatoroftheperformanceof

importers.Onaverage4days(figure2.6)separate

thedatesofassessmentandpaymentofdeclarations

bothforcontainerizedandnon-containerizedcargoes

(2daysformedianvalues).Thistimeisestimatedon

averageat2daysforbluelaneclearance,6daysfor

yellowlaneand4daysforredlane.Smallcustoms

brokersdisplayedonaverage1additionaldayforthis

componentofdwelltimecomparedtomediumand

largebrokers.Wecaninferthatdifficultiesofsome

importerstoaccessfinanceforpayingcustomsfees

isoneofthereasonsof longdeclarationpayment

dwelltime.

Thedeclarationassessmenttime(fromregistrationto

assessment),astepbeforethedeclarationpayment

timerepresentsonaveragelessthan2percentof

global cargo dwell time (figure 2.3) and less than

1percentfor90percentofcargoes.Itisworthnoting

that while the declaration time has been reduced

overthelastyearsasresultofcustomsreforms,this

transactiontimeisactuallymuchhighersincesome

brokersandcustomsagreeonalldetailswhenthey

wishtofraudbeforelodgingthedeclaration.

Thetimetogetexitpermit(Dateofissuingexitpermit

minusdateofpaymentofdeclarationfees)measures

theperformancesofimporters,terminaloperators

and brokers. It represents on average 20 percent

ofglobaldwelltime(18percentforcontainersand

28percentfornon-containers).Afterthepayment

ofcustomsfees,importersspendonaverage5days

(figure2.6)beforeobtainingtheissuingoftheexit

permit toremovecargoesoutof theport(3days

for containers and 13 days for non-containers).

75 percent of cargoes have encountered 5 days

asavalueofthiscomponentofdwelltime(4days

for containers and 14 days for non-containers).

Containerizedcargoesclearedthroughthebluelane

spendonaverage1additionaldayduringthistime

componentincomparisontothoseclearedthrough

theyellowlane(4daysagainst3)and2additional

dayscomparedtored lanecontainerizedcargoes

(2days).Itisalsothecasefortransit,riceandmaize

cargoes.Transitcargoestakesonaverage5daysto

getexitpermit(itreaches18daysforcargoesgoing

totheCentralAfricanRepublicwherethepolitical

instabilitymightexplainthislongdelay).Forriceand

maizecargoes,thetimetogetexitpermitisestimated

onaverageat40days,whichrepresentsonaverage

70percentoftheglobaldwelltime.Thelongtimeto

getexitpermitreinforcesthepresumptionthatsome

importers, especially large ones benefiting from

facilitiesthroughthebluelanecustomsclearance,

tendtousetheportasacheapwarehouse.Before

terminaloperatorsissueexitpermit,importersmust

payallcharges,includingwarehousingandtransport.

Thereforethereactivityofimportersinformulating

figUre 2.6: average Customs declaration registration time (in numbers of days)

0

2

4

6

8

10

12

14

Non -containerized Containerized Overall

Source: WorldBankusingdatafromCameroonianCustoms.

thisdemandofexitpermitislikelytobeaffectedby

financialconstraints.

After the issuing of the exit permit, 75 percent of

containerized cargoes exit within 1 day against 4

days for non-containerized cargoes. For rice and

maizecargoes,thiscomponentisestimatedat11.6

daysonaverage.Thislongdelaycanbeexplainedby

thefactthatimportersofthiscategoryofcommodity

havetoremovetheircargoesbyusingmanyrounds

oftrucksduetopoorroadinfrastructures,congestion

inportareascirculationinDoualaandweakhandling

ofterminalsequipmentsforloadingandunloading.

Duedothesechallenges,importersarguethatitis

impossibletomaketworoundsperdayswithtrucks.

In addition, the quality of trucks remains quite

questionable, which contributes also to increase

exitdelays.

Theanalysisofthedecompositionoftheglobaldwell

timeallowstheconclusionthatalargeproportionof

theglobaldwelltimeisneitherduetotransactional

processes nor operational processes but to

behavioralpractices.ItisactuallyduetowhatRefas

andCantens(2011)havedefinedasdiscretionary

dwelltimewhichcorrespondsto“thesumofallidle

timesbetweenvesselarrivalandexitfromcontainer

yardthatarestrictlystoragetimes’’.Thediscretionary

dwelltimeresultsmainlyfromabusinessmodelof

someimportersthatisbasedontheuseofthePort

aswarehouse.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala20 21

…mainly due to regulation and infrastructure limitations

Raballandetal(2012)haveidentifiedseveralreasons

forunusualcargodwelltimeinAfricanports.These

reasonsrangefromrent-seekingbehaviorsamong

shippers,intermediaries,andcontrollingagencies,

tolowlogisticsskillsandcashconstraintsformost

importersandprevailingmarketstructureonwhich

companiesuselongdwelltimesasastrategictool

topreventcompetition.ThesituationatthePortof

Douala is consistent with this observation. Based

onthe interviewscarriedoutduringthecollectof

cargodwelltimedataandthedisaggregationofthe

global dwell time above, specific reasons of long

dwelltimeatthePortofDoulacanbeclassifiedinto

six categories: (a) weak coordination of frontline

stakeholders;(b)monopoliesoftheinspectionand

the terminal operators; (c) Ineffective legislation

(d)highshareofinformalandunprofessionalbrokers;

(e)complexityandlengthofimportproceduresand;

(f)physicalandequipmentlimitationsofthePort.

Weak coordination of frontline stakeholders

RegulationofPortsinCameroonistheresponsibility

of the National Port Authority (APN), which

implementsthenationalportpolicyasdefinedby

the Government.7 The Port of Douala is managed

bythePortAuthorityofDouala(PAD). Itsmission

istocreate,maintain,improveandoperateallport

7Assuch,itisresponsibleforthenationalportdevelopmentplanning:developmentandcontroloftheimplementationofportsecurityandpolicestandards,ofthemonitoringof the implementation of legislation and regulationson environmental port protection; port performancemonitoring; compliance with competition rules in theexerciseofportactivities;monitoringoftheimplementationof the reducing port costs plan ; the participation, asappropriate, in the negotiations of the agreements tobe signed by the Government in the port field and thedefinitionoftheframeworkoftheexerciseandtransfersofportactivities.

facilities8toprovidecustomerswithaservicethat

meetstheirongoingneedsandexpectations.The

International Maritime Transportation Facilitation

Committee(FAL)wasestablishedin1997toensure

the facilitationofmaritimetraffic. Itsmaintask is

to monitor and coordinate the implementation of

measurestofacilitateandspeeduptraffic.

Since January 2005, the management of the

containerterminalwasgrantedbytheportauthority

toasinglecompany:DoualaInternationalTerminal

(DIT).MAERSKandSDVarethemainshareholders

with80percentofthesharesandcontrolmorethan

80percentoffreighttraffictoimportandexport.DIT

isresponsible forhandlingship(usingstandalone

gantry), handling land, and park management.

Handling operations are under the responsibility

of private operators grouped in unions. The most

importantistheGPAC(ProfessionalAssociationof

StevedoresofCameroon).TheCameroonNational

Shippers’Council(CNCC)whichisapublicagency

with legal personality and financial autonomy

providesassistanceandprotectinterestsofshippers.

A Single Window for Foreign Trade Operations

(GUCE) was created in 2000 to coordinate and

host inasingle-pointallthestakeholders involved

intheprocessof importandexportofgoods. It is

operationalsince2002.Itgroupsinthesameplace

entities representing customs, foreign exchange

service;theplantprotectionservice;theTreasury;

the PAD; the National Office of cocoa and coffee

Board(NCCB);theSociétéGénéraledeSurveillance

8Theportisorganizedinto11geographicareasofoperationincluding:(i)anareaforvariousgoods,(ii)amodernizedcontainersterminalwhichcoversanareaof23hectaresdividedintofourstorageareasandisintendedforcontainertrafficandimportedvehicles.Itreceivedin2013trafficof350,000TEUs.Therateofoccupationoftheterminalwasestimatedto90%in2013with65%ofboxesforimport,30%forexportand5%ofunloadboxesand(iii)aterminalforwoodtreatment;Afruitterminalformainlytrafficofbananas, pineapples and cereals; Mineral terminal fortrafficofaluminum;Oilterminal;Fishingarea;Shiprepairzone; Zone of logistical support to traffic of hinterlandcountries;Zoneoflogisticalsupportforoilexploration;Thelong-termstorageareasincludingwarehouses.

(SGS), banks and veterinary and phytosanitary

services. In 2007, the Government of Cameroon

launchedtheimplementationofthee-Guceaspart

of the automation on trade procedures with the

establishmentofanelectronicsinglewindowwhich

isacomputingplatformaimingtodematerialize36

trade procedures. Supported by the World Bank,

since2009,thisextensiveandambitiousprogramme

aimsatacceleratingtheautomationofinternational

trade procedures. The certificate of identification

ofsecond-hand importedvehicles(Civio)usedby

theSociétéGénéraledeSurveillance(SGS)andthe

automation of 16 procedures out the 36 planned

are among the achievements of the automation

programme.

The implementation of the GUCE has resulted in

productivitygains,areductioninthetimeoftransit

of goods, more security, a reliability of transport,

and an improvement of the quality of services of

the operators. However, the process of physical

layout at the one-stop shop of all stakeholders

remainsunfinished.Thisisthecaseofconsignees

and stevedores who are not physically within the

one-stopshop.Itseemsthattheavailablespaceof

theGUCEcannotaccommodatealloperatorsinthis

sector.TheSGShasonlyasmallteammakingthe

bulkoftheworktobedoneatitsheadquarters.On

theotherhand,althoughthebulkoftheservicesof

CustomsarepresentwiththeGUCE,theofficesof

transitandoneofhydrocarbonsarestilloutofthe

platform,whichisaburdenforsomeusers.

The weak coordination among key Port’s private

stakeholders also affects negatively cargo dwell

time.Theconsigneedoesnotofteninformimporters

orregistrantsofthearrivaloftheships.Importers

havetocallthecarriertofindoutiftheboatarrived

and have the manifest number and find out if

transshipmenthadhappenedduringtheride.Thus,

itmaytakeadaytohavethemanifest.Also,there

may be a difference between the manifest of the

vessel owner and the consignee manifest. Once

theconsigneehasvalidatedthemanifest,onlythe

customs can modify it. The modification of the

manifestmaytakeseveraldaysandaslongasitis

notdone,nodeclarationcanberegistered.

Itisalsotobenotedthatmultipleotheradministrative

services,presentinthePortandinvolvedinimport

procedures(marineservicesandMaritimeAffairs,

the gendarmerie, the police at the borders, the

fire department...) are still not present within the

GUCE. They are functioning following their own

rulesandthistendstogenerateunpredictabilityin

thelistofproductstobecontrolled.Thissituation

leadstoseveralharassmentsofimportersandthe

need for bargaining that induce additional cargo

dwelltimes.Inthesameperspective,thereisalack

ofarealsinglewindowfor thepaymentof feesto

thesevariousactorsandimpossibilitytopaythem

electronically.Theabsenceofanelectronicplatform

forsharinginformationofthesevariousstakeholders

islikelytomaintainacorruptionclimateatalllevels.

With the ongoing activities to reinforce and equip

theGUCE’splatform,financedbytheWorldBank

through its Regional CEMAC Trade and Transit

Facilitationproject,thereismuchhopetoupliftthese

bottlenecks.

Monopolies of the inspection and the terminal operators

Pre-Shipment Inspection (PSI) complements

informationprovidedincustomsdeclarationsand

canbeusedtoevaluatecustomsduties.Asaresult

of inspection, the PSI firm issues a certificate of

conformityoracertificateofnon-conformity.The

customs administration intervenes after the PSI

firm.As inmanyotherscountries,onlyoneofPSI

firmhasbeenoperating inCameroonsince1988.

Someimporterspointedtothedifficultytohavea

promptanswerofthePSIfirmincaseoflitigation.

TheyarguedthatPSIfirmshaveatendencytosignal

errorsonlywhenthis increasesthepaymentthey

receivewhichresultsindelaystoobtaincertification

required to register a customs declaration. As a

result, importers perceive the behaviors of these

powerfuloperatorsasmonopolisticpractice.

Besides,tosomebrokersandimporters,conditions

setbyship-owners for theremovalofcontainers

tend to penalize Cameroonian SMEs and entail

long cargo dwell times. This is for instance the

casefortheobligationtodepositofCFAF1million

per container (about 2,000 USD) and delays in

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala22 23

repayment of the deposit. Dealing with such a

deposit becomes problematic when a customs

broker is facing 30 or 50 containers. He has to

find revenue to cover the operation and that can

generateadditionaldelays.Thispracticeofdeposit

of a large amount of money prior to removing

the container is perceived as being unfair and a

distortiontofreetradesincethedepositispaidby

someimportersandnotbyothers.Thereforethe

systemisperceivedbylocalimportersasastrategy

ofunfaircompetitionfromlargefirms.Inthesame

vein, some brokers argued that the containers

terminaloperator“Douala InternationalTerminal

(DIT)”seemstobelessneutralandtendstofavor

importersrelatedtoitsinternationalshareholdersto

thedetrimentoflocalSMEsregardingtheremovalof

containers.Asthereareinsufficientequipmentfor

terminaloperations(onlytwogantriesoftendown),

DITtendstohandleinprioritycontainersthatmust

beinspectedthroughscannertothedetrimentof

containerswithmanybillsofladingwhichmustbe

clearedatexternalwarehousing.Fournewgantries

havejustbeenboughtbyDITinMay2014,whichis

expectedtosubstantiallyresolvetheseconstraints.

Ineffective legislation

Oneofthemaincausesofcargodwelltimeatthe

portofDoualaislackofanadaptationoflegaltexts

tofacilitateprivatemanagementoftheport.Thelaw

on port operations which dates back to 1985 and

hasnotevolveddespitetheprivatizationoftheport

management since 1998, which set the free time

at11daysforimportand90daysfortransit.Italso

setthedailystoragefeesataverylowlevelofCFAF

600/day(around1USDperday).Theconsequence

is that it iseconomically interesting for importers

to keep cargo for long storage within the port as

the external storage will be more costly. This is

particularly true for the dwell time of refrigerated

containers for which the daily fees per container

isCFAF10,000(around15USD)whilethecostfor

theterminaloperatoristwicehigher(CFAF24,500)

duetothecostofelectricity.Theimportersuseport

installations to keep theirs commodities because

itischeaperthanoutsidewheretheyshouldrenta

warehouse,payforelectricityandsecurity.

Thereforesomelargeimportersdonothesitateto

privatizethesmallparkofrefrigeratedcontainersas

abusinessstrategytoexcludesmallercompetitor

from the market. The current occupancy rate

of the terminal is 130 percent because about

4,000containerswhichwereassessedbycustoms

arecurrentlyenjoyinglongdwelltimeattheterminal.

Thisrepresentsaround40percentof thestorage

capacityoftheterminal.Thesecontainersareowned

bylargeimporterswithhighinfluentialpower.This

behavior is detrimental to local SMEs in terms of

competitiveness.

High share of informal and unprofessional brokering market

TheroleofacustombrokeriscentralwithinaPort.

Aselsewhere,inCameroon,importersmustusea

customsbrokerwhoactsonbehalfoftheclientand

isresponsibleforallcustomsclearanceoperations.

Specific skills, knowledge, and experience are

needed for effectively managing the clearance

process,properlyassessingtherisks,andensuring

profitability.It isnotalwaysthecaseinthePortof

Douala.Accordingtoarecentstudycompletedby

Cantensetal(2014),threebrokercategoriesexists

at the Port of Douala: (i) formal brokers (working

withinformalimporters),(ii)“Professional”informal

brokers with training, education, and experience

in the transit sector and a sound knowledge of

customs practices, procedures, and documents,

(iii)Nonprofessionalbrokers,otherwiseknownas

bala-balasbytheirmoreprofessionalcounterparts.

Somehaveanintuitiveknowledgeoftheprofession,

whileothersarequiteexperiencedand,ingeneral,

aremoreeagertotakeonriskswithfewercontainers.

Overall,ThomasCantensetalhaveidentifiedmore

than200informalbrokersoperatinginandaround

the port of Douala (versus 220 official brokers9,

includingofficialrepresentativesofembassies).

Theissueofcargodwelltimeisespeciallyproblematic

forthebala-balasbecauseoftheirnonprofessional

practicesandlackofskills.Brokersestimatedthat

9 Approximately 200 official certified customs brokers(commissionnaires agréés en douane, CAD) operate inCameroon.

between 50 and 80 percent of informal brokers

arebala-balas(accountingforlessthan30percent

of declarations) who have no license and no

identification (ID) login to access the IT customs

system,whichismandatoryforlodgingadeclaration.

They thus “hire” (against payment) an ID from a

licensed broker and lodge declarations through

the broker’s login. Most of them ignore clearance

proceduresandthefull listofdocumentsrequired

whichentailsoverheads,stress,leadtolowerquality

ofservicesandthereforecontributestotheincrease

ofdwelltime.

As shown by Refas and Cantens (2011) this high

informalityistheconsequenceoftheveryconcentrated

brokering market in Douala, with an aggregate

marketshareofthe20biggestagentsthatexceeds

55 percent for container imports destined to local

consumption.Despitetheincreaseinthenumberof

brokers inoperation(+4percentannually)thefirst

playersgainmarketshareeveryyear.Theconcentration

leadsto lownegotiatingpowerofclients,especially

small and occasional ones who turn to low cost

unprofessionalbrokers.

Length of import procedures.

Asatisfactionsurveyofusersofthecarpark,and

among brokers and importing firms conducted

in 2012 by the regional Institute for Statistics

and Applied Economics (ISSEA) identified slow

administrative procedures as one of the main

obstacles to the reduction of delays at the Port

of Douala. As shown in figure 2.7 below, brokers

and importerscriticize theclearanceprocedures,

especially at the PAD, SGS, DIT, stevedores and

Treasury.Thesegrievancesrelatetothenumberof

documents, travelanddeadlines.Usersmuststill

move with a lot of photocopies to adjust certain

operations,evenifstakeholders,apartfromthoseof

thecarparkandstevedores,arefoundinthesame

building.Most importersofsecond-handvehicles

havesuggestedgroupingthroughtheautomation

programallthestakeholdersinvolvedinthecustoms

clearance procedure. The ongoing automation

programshouldsignificantlyreducetheslownessof

procedures.

Physical and equipment limitations of the Port

TheinfrastructureofthePortofDoualaisinsufficient

and of low quality. According to a report of the

nationalportauthority(APN)madepubliconJuly

2014, the port of Douala that was designed to

accommodate traffic of 10 million tons is running

todaybeyonditscapacity.Thecurrenttraffic,which

increasedby9.8percentbetween2012and2013

exceeds by 600,000 tons its real capacity. This

situationresultfromseveralfactors,amongwhich:

thefluvialnatureofthePort,insufficientquaysand

handlingequipments.

figUre 2.7: port stakeholders where Users are more affected by slow administrative procedures

0

10

20

30

40

50

60

70

PAD

SGS

DIT

Stev

edor

es

CNSS

Trea

sury

GUCE

Polic

e

Bank

s

Source: ISSEA.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala24 25

Thefirstphysicallimitationisthefluvialnatureofthe

Port.LocatedintheestuaryoftheWouririver50km

fromtheseaintheheartoftheGulfofGuinea,the

PortofDoualaextendsoveranareaof1,000haof

which60percentareexploited.Thetotalwharflength

is600metersandthedepthhastobemaintained

ataminimumof7mtoallowaccesstoships.The

Wouririverdoesnotbenefitfromregulardredging

toremovesandwhichentailswastingtimeatlanding

(saturatedquays,12intotal)andattheentrygate

of the port.10 In addition, the docks of the Port of

Doualahavebeenbuilttoaccommodatevesselsof

150meterswhilethetendencytodayistousevessels

measuring200metersforscaleeconomy.Thearrival

of longer vessels lengthens the time needed for

unloadingoperations.Thesedelaysaffectbothcargo

dwell time incontainerizedandnoncontainerized

terminals. These delays have been estimated at

5 days on average during 2013 according to port

operators.Thesituationhasworsened in thefirst

semesterof2014whentheaveragenumberofwaiting

daysincreasedto9.7days.Accordingtolocalpress

articles, in May 2014, more than 20 vessels were

waitingfor1monthattheentrypointoftheportdue

tocongestiononquaysoftheportwheremorethan

10vesselswerestilloffloading.

Insufficientnumberofquaysandweaknessesofthe

Doualacontainerterminal(DIT)alsocontributetothe

weakoperationalcapacityofthePort.Twoofthe15

existingquaysaredefectiveandonrehabilitationand

amongtheother13,someareclutteredbyshipsand

wrecksorservedforactivitiesthathavenothingtodo

withtheirpurpose.

10ThePorthastwoentrances,thenorththatisreservedforentryoftrucksandtractorsandthesouthernforexit.Howeverhandlingequipmentcanusebothaccess.Thesouthoneisregularlycongestedduetothepoorqualityofroadsleadingtotheportwhichalsoentailsomedifficultiesorimpossibilitytomakemorethanonerotationsperdaybytrucks.Asconsequence,thehandlingofcontainersisdoneonlybyoldtrucks.Thetrucksownersconsiderthatitisalosstoassignnewtrucksfortheseoperationsinsuchconditions.

Concerningthecontainerterminal,untilthemiddle

of the year 2014, DIT had only two Wharf cranes

andthuscouldnotusethe3postsatitsdisposalto

handletheunloadingofshipsandassuchwasunable

tomeetdailyrequestsforremovalfromimporters.

Overall,thebrokeringprofessionestimatesthatasa

resultoftheinsufficientnumberandfailuresofWharf

gantry, container terminal performance declined

from23containersperhourto20containersper

hourfrom2012to2013.Thissituationhasledtothe

redirection of some vessels to neighboring ports.

Thebrokeringprofessionestimatesthatanoptimal

handlingsituationrequires fourwharfcranesand

eight gantries. At the time of writing, work was

underway for the installation of four additional

gantriespurchasedinMay2014.

Furthermore, few trucks in good condition are

availabletodelivercargoestoconsigneesduetothe

badqualityandtrafficcongestionoftheaccessroad

totheport.Importersarguedthatitisimpossibleto

make2tripsperdaypertruck.Onepotentialsolution

couldbetodefinenighthoursforthetrucktrafficof

largeimporters.Itisthesamedevicesthatareused

bothtounloadanddelivercontainers.

Frontally addressing these infrastructure and regulation limitations will enhance the efficiency of the Port of Douala

Theimprovementoftheefficiencyofthemanagement

of the ports has been a key component of the

governmentactiontopromotetheattractivenessof

thecountryduringthepast15years.Theseefforts

are today reflected in significant improvement of

transportinfrastructure,modernizationofcustoms

administration, intensification of the fight against

corruption and informal practices and border

controls. The Government is supported by the

donorcommunitythroughamulti-donortransitand

transport facilitation program co-financed by the

WorldBank,theAfricanDevelopmentBankandthe

EuropeanCommissiontohelpCameroon,Central

African Republic and Chad address their trade

facilitationchallenges.

Despiteoftheseeffortsdeployedoverthepastyears,

theobjectivetoreducetheglobaltimeto7daysatthe

endofthe1990hasnotyetbeenabletobeachieved.

Theglobaldwelltimestillrepresentsmorethanthree

timesthattarget.Thedecompositionoftheglobal

dwell timeandtheanalysisof thereasonsofhigh

dwelltimeabovehaveshownthatthehighimpacts

problemsofhighdwelltimeareaboveallstructural

(weak coordination of stakeholders, monopolies

of the Port and the PSI operators, informal trade

practice,useofthePortascheaperwarehouse…)

thananyother.Thatcallsfirst forthepreparation

andadoptionbyallstakeholdersofacomprehensive

structuralreformplan.Othersoptionsrecommended

bythepresentreport to improvetheefficiencyof

thePortofDoualainclude:therevisionofthelegal

frameworkgoverningthePort,theimprovementof

the awareness of importers and brokers on trade

procedures,theaccelerationofthemodernization

ofthePortofDouala,andtheimprovementofdata

collectionandanalysisoftradefacilitationstatistics.

The need for a comprehensive structural reform plan

Thedeterminantstepforsettingupacomprehensive

structural reform plan aimed at achieving a

sustainablereductioninthedwelltimeshouldbeto

buildconsensusamongvariousstakeholdersinorder

toovercomestatusquopracticesandbehaviors.This

impliestotake intoaccountthepoliticaleconomy

surroundingimportandexportactivities.Basedon

theexperienceoftwoPorts,arecentstudyledby

Raballandetal.(2012)hasidentifiedkeycomponents

ofareformpolicythatcould leadtoasustainable

reductionindwelltime:(a)political impetusofthe

State, (b) regular meetings of stakeholders at a

decision-makinglevel,(c)auditteamstoreengineer

processes, and (d) a comprehensive approach

to changing the behavior of stakeholders. The

Boxbelow, showsthemain features onhow such

approach was successfully applied in Durban

andDaresSalaamPorts.Thesetwocasestudies

demonstratethataddressingstructuralconstraints

can lead to a sustainable reduction of the dwell

timeandsignificantly improvethecapacityof the

containerterminalwithoutanyinvestmentinphysical

extensions.

Astartingpointofthepreparationofsuchstructural

reformplanshouldbeanindependentauditonchoke

pointsinanyareaofportoperations.Itshouldinclude

auditsofthemonopoliesofthecontainerterminal

concession and the PSI operator performances

due to their strategic role within the Port. These

auditscouldserveasbasisfortheimplementationof

performancebasedmanagementcontractforthese

twooperators.

Theobjectiveoftheauditofthecontainerterminal

concession would be to assess its performance

comparedtothemissionsthathavebeenassigned

toit.Theresultsoftheauditcouldalsohelptobring

clarityon(i)theconcessionalagreements,onthe

distributionofrolesbetweentheconcessionaireand

thePortauthorities,(ii)thealignmentofincentives

of the concessionaire and the country’s, and

(iii) performance targets in concession contract.

Such audit would temper the perception that the

performanceofDIThasincreasedatthemarginwhile

tariffshavetremendouslyincreased.

Concerning the audit of the PSI operator which

is in place since 1988, in principle, PSI programs

arereputedtobetransitorytoavoidcollusionwith

others stakeholders (V. Dequiedt et al., 2009).

An operational audit would help to assess the

performanceoftheoperatorandadvisewhetheror

notitscontractshouldbemaintained.

Similarly, the recent study of Cantens and al

(2014)haspointedouttheneedforShapingbrokers’

marketstructureandpracticestochanginginformal

tradepracticesinanincentive-compatibleapproach

andrecommendsthatforpoliticaleconomyreasons,

acoalitionbetweencustomsandsomebrokersand

importersshouldbeencouraged.Howeveritnotes

thatthiswouldnotbeaneasytaskbecausebrokers

aresometimespoliticallypowerfulandsomepast

initiativeshavenotledtotheexpectedimpacts.For

example,theTradeFacilitationCommittee,GUCE,

and customs wanted to establish a certification

programforbrokersandfreightforwarders,butcould

notachievetheirplansbecausesome“professionals”

didnotmeettherequiredcriteriaandsabotagedthe

wholeinitiative.Adifferentiatedapproach(through

contractualincentives)couldalsobeenvisionedto

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala26 27

addressthatmatter.Thesamestudyalsomentions

that it is essential that customs officials disrupt

information asymmetries and better disseminate

information to informal importers on customs

processes and official costs and should sanction

more strongly some informal brokers in order to

reducecollusionwithsomecustomsofficers.

Finally,theNationalPortAuthorityofDoualashould

prepare and implement an ethics code for the

importersandconsigneesaswellasperformance

contractsforconsignees.Thecodeofethicsshould

bepartoftheapprovalofconsignee’scontractsand

subjecttoanamendmentofformercontract

It is worth noting that long term commitments

frompolicymakersandprivatestakeholderswillbe

essential. Indeed, reducing cargo dwell time may

notbeintheinterestofsomeprivatestakeholders

(terminal operator, customs broker, importers)

becausethestatusquoissupposedtocontributein

optimizingtheirsprofits(theportisacheapandsafe

storagesolutionforsomeimportersanditgenerates

somegainsforportwarehousingoperators).

Revise the legal framework governing the Port of Douala.

Theobjectivesofthisrevisionwouldbetodiscourage

the use of the Port as storage. The reform would

consistintherevisionofthelawonportoperations

whichdatesbackto1985tointroduceasubstantial

increaseinwarehousingfeesandanapplicationof

financial penalties such as those proposed in the

financelaw2003/07for2004fiscalyearstatingthat

cargoescarriedinCustomsofficesshallberemoved

upontheissuanceoftheauthorizationgrantedby

thecustoms(afterthepaymentofduties),except

timespeciallygrantedbyit.Failuretocomplywith

this legal obligation should be sanctioned by the

paymentofafixedpenaltyaccordingtothefollowing

scale: 1 to 30 days: CFAF 100 000 (around 200

USD);31to60daysCFAF200000;61to90days:

CFAF300000;beyond91days:CFAF400000per

month.Thescaleofthesefinancialpenaltiesshould

beincreasedinordertohaveaneffectiveimpacton

behaviors.Thisfinancialsanction,althoughmodest,

isnotcurrentlyapplied.Wesuggestthatinaddition

tothestrictapplicationofthelaw,theauthoritiesalso

considertosignificantly increasedemurrageafter

22days,exceptspecialdispensationofthetypesof

commodities.

Besides,itshouldbenotedthatcustomsdonothave

aspecificareawithintheport forstoringcargoes

havingpassedthedeadlineof11daysoffreetime.

Thus,thesecargoescoexistwithcargoesunderfree

time.Article108oftheCEMACcustomscodedefines

90 days as a maximum clearance delay beyond

whichcargoisconfiscatedandputundercustoms

bondedstoragetobeauctioned.Inpractice,public

auctionsareorganizedeach6monthsattheport

ofDouala. Inaddition,beforepublicauctionsome

importers seize the judge to oppose the sale and

oncetheorderisobtained,noformalitiesofremoval

shall be taken until the next sale where the cycle

begins again. Therefore, a change in the CEMAC

stockpilingregulationsshouldbedone. Insteadof

prescribingaformaldepositionattheendofthefree

time,which isaltogether fictitious in fact, itcould

be like insomecountrieswhere incustomsareas

cargoesareorganizedinthefollowingmanner:free

timeperiod;timeout;stockpilingafter90daysbut

themerchandiseisconsideredabandonedandcan

neitherbedeclared(ifnotyet)norremovedbythe

importer as it becomes the property of customs

administrations.Thisorganizationwouldhavethe

advantageofavoidingsuccessivedelaysincargosale

afteracourtdecision.TheGovernmentofCameroon

shouldalsoconsidertheprivatizationofwarehousing

anddryportcustomclearancespacesoutsidethe

Doualaport.

However,thesereformsshouldensurethatimporters

willnottranslateallfinancialsanctionsduetolong

dwelltimeintothefinalpriceofgoodsforconsumers.

This requires a political support and the general

public must be well-informed about challenges

underlyingreformsaimingatreducingcargodwell

timesothatitbecomesadriverofchange.Highlevel

publicdecision-makersshouldbeinvolvedthrough

aneffectivecommitmenttoovercometheproblem

because it impedes the welfare (increase in final

prices)andtheattractivenessofthecountryinterms

oftrade,investmentsandcompetitiveness.

Finally, there isalsoaneedtorevisethestatusof

thecustomsstaffandthoseofothersstakeholders

involvedinthefunctioningofthePort.Legalworking

hoursthatarecurrentlyfrom7:30amto3:30pm

need to be adapted to the current situation of

congestionofthePort.Itwouldbehelpfultomake

working hours more flexible through allowing

customs and others Port operators to maintain a

workingpresence24hoursaday,sevendaysaweek.

Thisrevisionofworkingtimecouldbeaccompanied

byaperformance-basedpaysystemforcustoms.

box 2.2: examples of successful reforms in reducing Cargo dwell time in africa

the case of the Port of durban. FollowingrecurrentmutualcomplaintsbetweenTransnetPortTerminals

andprivatestakeholdersondwelltimeanditscauses,aninterimadvisoryboardwascreated,co-chairedbya

managerfromTransnetandachiefexecutiveofficerfromtheprivatesector,withthemandatetoidentifythe

keymeasuresthatshouldbeimplementedtoreducedwelltime.Overaperiodofthreeyears,thiscommittee

metfortnightly.ThecommitteeincludedthePortoperator(TransnetPort),therailoperator(TransetFreight

Rail),cargoowners(containerLineroperatorsforum);landlordandmarineservices,theNationalPorts

authorityandfreightforwarders.Anauditteamwasaddedtothegrouptoprovideanindependentview

onwhatshouldbedone.Thisteamwascommissionedonanadhocbasistogivetechnicaladviceonthe

measurestobetaken.Itwascomposedofarepresentativeofashippingline,arepresentativeoftheroad

freightassociation,arepresentativeofPortnet,andarepresentativeofanengineeringfirm.

ThelessonsfromDurbanshowthattheterminaloperatorfirstneedstoreengineeritsinternalprocessesand

proceduresandthentoagreeonmeasurestochangethebehaviorofprivatestakeholders,suchasshipping

lines,transporters,customsbrokers,andsoon.Itisalsocriticaltoresolvehigh-impactproblemsfirstand

thentoagreewithportusersontheproblemtoberesolved.Inthisregard,itisimportanttodemonstratethat

dwelltimecanbereduced.Durbanstakeholdersusedacomprehensive“enablingblock”approachwhich

changedtheincentivesforcraneoperators,changedporttariffs,alteredtheopeninghoursofcontaineryard

operators,establishedaqueuingsystemfortrucks,andinvestedinsoftwareandequipment.Averagedwell

timethatstoodatsevendaysin2002wasreducedtothreedaysin2004.

the case of the Port of dar es salaam.InDaresSalaam,amultistakeholderworkshopondwelltime

identified205issuesinJune2008andproposedactionstoimprovetheperformanceofdwelltime.The

processwaschampionedbyahigh-levelinterventionledbythepresidentandprimeminister,whichresulted

intheformationofamultistakeholderPortDecongestionCommittee,whichmetfortnightly.Moreover,

stakeholderscommissionedacommitteeofspecialiststoidentifykeymeasurestoreducedwelltime.

ThesetupandfunctioningofthePortImprovementCommittee(PIC)issimilartotheapproachtakenin

Durban.Forexample,participationisatthechiefexecutivelevel,bothprivateandpublicsectoragencies

arerepresented,meetingsareheldfortnightly,andtwosubcommittees—oneondwelltimeandanotheron

standardoperatingprocedures—convenetotacklespecifictechnicalassignmentsonbehalfofthePIC.The

subcommitteeonproceduresundertakesauditsonchokepointsinanyareaofportoperations.Ittookabout

oneyeartodevelopthestrategyforincreasingstoragethroughputandalteringthebehaviorofthevarious

participants.Outof205issuesidentifiedthroughstakeholderconsultations,thePICsummarized10priority

actionstoreducedwelltimeandimproveproductivityintheport.ReportsbythePICindicatethatdwelltime

wasreducedfrom25daysto15in2009andthento13in2010.

Source: Raballandetal.in Why does cargo spend weeks in Sub-Saharan African Ports, lessons from six countries, chapter 6, pp88-92.

Cameroon eConomiC Update n8 assessing tHe performanCe of tHe port of doUala28 29

Improve the awareness of importers on trade procedures

Thisrecommendationhastwoobjectives:todecrease

thefinancialunpreparednessoftheimportersand

reducerentseekingbehaviorofportstakeholders.

Asseeninaprevioussection,thelackofknowledge

of procedures leads to financial unpreparedness

of the importer. Two main measures could help

address the misinformation of the importers on

theproceduresoftheircase:(i)theorganizationof

trainingandworkshopsand(ii)theimplementation

ofanalertsystemonthetraceabilityofvesselsand

cargoescomingtothePortthatwillhelpimportersto

anticipatethemobilizationofvariouscostspayable

ontheportarea.

Concerning the training on procedures, at the

requestoftheFAL,theCameroonNationalShippers’

Council projects to organize series of workshops

on procedures for trade operators. To be more

productive,theseworkshopsshouldbedoneonthe

basisofa“guidetotheimporter,”editedorpublished

byCustomsorGUCEandshouldleadtothedelivery

of a certificate of importation preparedness to

importersthathaveparticipatedtotheworkshop.The

expectedresultsofthismeasureshouldhoweverbe

temperedduetothefactthatmanyofimportershave

abusinessmodelbasedoncollusionwithcustoms.

Extensivetrainingsweredoneinthe90s/2000sand

didnotleadtoimpressiveresultssincetheones,who

wishtofraud,eitherdonotattendtrainingordonot

usethem.

Forthesettingupofanalertsystem(email,SMS)

the authorities could use data from ASYCUDA to

informimportersdirectlyonthelevelofprogressof

theircaseateverystage.Theauthoritiescouldputin

placeaweborSMSapplicationallowingtheimporter

tofollowhiscase,basedondatafromASYCUDAand

informtheimportersontheexistenceofthistool.The

ongoingactivitiestoreinforcetheGUCEwillmake

possibletheseoptions.ThePortauthoritiesshould

alsosolicitfromcarrierstomaintaininformationon

transshipmentsontheirwebsites,ormakeitavailable

tocustomsorGUCEsothatimporterscanaccess

informationthroughawebsiteorviathenotification

system.Additionalactiontoincreasetheawareness

onprocedurescouldincludeautomaticinformation

toimportersbyemailorSMStonotifythemwhere

tofindtheproceduresandregularinformationinthe

newspapersabouttheavailabilityofproceduresat

thewebsitesofDGDorGUCE.ThePortauthorities

couldalsoprovideanonlinesimulatorallowingthe

importer to estimate duties and taxes to be paid

beforethearrivalofhisgoods.

Accelerate the modernization of the Port of Douala

The modernization of the Port of Douala requires

continuation of efforts by the authorities and

othersstakeholdersofthePortontheupgradeand

the modernization of the Port of Douala. Douala

InternationalTerminal(DIT)hasrecentlyinvestedon

themodernizationofthecontainerterminalthrough

theacquisitionoffournewgantrycraneswhichare

operationalsinceAugust2014.Thisinvestmenthas

increasedDIT’sproductivity throughaccelerating

containerhandling.TheFALhasalsodecidedduring

hissessionofearlySeptember2014toinviteDITand

PADtocarryoutthenecessaryconstructionworks

withintheboundariesof thePorttobuildaspace

thatcanaccommodate10,000containersinorder

to freeupspace in the terminalcontainer.During

thesamemeeting, itwasalsodecidedtosuspend

theadmissionof logs intheportenclosureandto

reorganizethemovementofthereleaseofcontainers.

TheGovernmenthasalsocarriedoptionstoshipfrom

thePortofKribi.Aspartthislaterdecision,DITand

PAD should explore opportunities to improve the

supplyoftrucksandtruckmaintenanceforgreater

availabilityandSGSshouldputaneffectivesystem

formonitoringandmaintainingthescanner.

Improve data collection on trade facilitation

Overall,tradefacilitationandtransportintheCEMAC

zonesuffersfromlackofstatistics,bothatMember

StatesandtheCommissionofCEMAClevels.The

situationischaracterizedbyseveraldifferentdata

accordingtothesourcesofinformation,whichcan

leadtoerroneousresultsandinduceuserstomake

riskyconclusions.InCameroon,forcalculationsof

dwelltime,theGUCEexploitsdatacontainerswhile

theDGDusesalleligibledata.Inaddition,theDGD

islimitedtogoodsthatarenotmorethan90days

old,whichisnotthecasefortheDITorGUCE.These

differencesindatasamplescanleadtodifferences

inresults.Theupdatingof indicatorsandcreating

statistics being recurring exercises, it would be

desirabletocontinueperiodically,whilerefiningthe

methodology.Similarly,itwouldbeusefultoinvolve

allentitiesproducingstatisticaldataontransportand

transit,andtoestablishamechanismforvalidation

andpublicationofthestatistics

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