Cameroon industrialization, Economic balance

Cameroon's Economic Crossroads: Can Industrialization Overcome Trade Barriers?

Lena Voss in Business & Economy August 2025 • 4 min read.

"An in-depth look at how trade policies are shaping Cameroon's manufacturing sector and what it means for the nation's future economic growth."

For any nation, a robust industry is synonymous to economic growth and sustainable development. Developed countries thrive because of highly mechanized secondary sectors. Machines boost productivity, and generate opportunities for wealth creation, making industry a cornerstone of economic advancement. But what happens when a developing nation attempts to integrate into the global market before establishing a strong industrial base? How trade policies impact the manufacturing capabilities, and ultimately, the economic trajectory of these countries?

In Cameroon, a country striving to find its place on the global economic stage, the industrial sector's contribution to the Gross Domestic Product (GDP) is notably low, outpaced by the tertiary sector. This situation is a result of structural issues, ranging from high production costs and supply chain complexities to unfair competition and governance challenges. These issues are intensifying as Cameroon engages in free trade agreements with economic powerhouses such as the European Union, which creates questions about the countries industrial future.

This article investigates the relationship between trade liberalization and industrialization in Cameroon, using insights from an 'Industrialization of the Manufacturing Sector and Trade Opening in Cameroon' research paper. It examines the effects of trade policies on Cameroon's manufacturing sector, with a goal to identify opportunities for sustainable growth

How Trade Opening Affects Manufacturing in Cameroon

Cameroon industrialization, Economic balance

The study uses data from 1967 to 2007 to analyze the relationship between trade opening and manufacturing sector industrialization in Cameroon. The findings indicates that trade liberalization negatively impacts the manufacturing sector in Cameroon. This is because the importation of food products and other essential inputs cannot be reduced, and also, local manufacturing enterprises are unable to meet the local demands.

Here's what's impacting Cameroon's industrial sector:

High Production Costs: Manufacturing industries face high unit costs, with inputs constituting a major portion of expenses.
Competition and Governance: Smuggling, unfair competition, high tax rates, and governance issues further complicate the business environment.
Trade Dynamics: Trade liberalization reduces import prices, but local industries struggle to compete with cheaper foreign products.

Cameroon's trade dynamics reveal a troubling trend: increased imports and stagnant exports. This imbalance leads to trade deficits. The country's reliance on primary product exports, such as aluminum, rubber, banana, wood, cocoa, coffee, and cotton, exposes it to exchange rate volatility and income instability. The reliance on imported household consumption goods further diminishes the advantages of trade opening.

Charting a Path Forward

Trade opening is harmful for the competitiveness of the manufacturing sector in the short and long-term, and any increase in the money supply can induce a general price increase. It is therefore important for Cameroonian authorities to define and apply a strategy of restructuring of enterprises and especially to build a strategy of economic relaunch based on supply and not on demand.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.5430/rwe.v2n1p58, Alternate LINK

Title: Industrialization Of The Manufacturing Sector And Trade Opening In Cameroon

Subject: Political Science and International Relations

Journal: Research in World Economy

Publisher: Sciedu Press

Authors: Henri Atangana Ondoa, Henri Ngoa Tabi

Published: 2011-04-21

Everything You Need To Know

What is the primary impact of trade liberalization on the manufacturing sector in Cameroon?

According to the research, trade liberalization has a negative impact on the manufacturing sector in Cameroon. This is primarily due to the inability of local manufacturing enterprises to compete with cheaper imported goods and to meet local demands effectively. This effect is compounded by high production costs, issues with competition and governance, and the inability to reduce the importation of essential inputs.

Why is the industrial sector's contribution to Cameroon's GDP low compared to other sectors?

The industrial sector's contribution to Cameroon's Gross Domestic Product (GDP) is notably low due to several structural issues. These include high production costs, complexities within the supply chain, unfair competition, and various governance challenges. These factors collectively hinder the growth and competitiveness of the manufacturing sector, leading to a smaller contribution to the overall economy compared to the tertiary sector.

How do high production costs affect the manufacturing sector in Cameroon?

High production costs significantly impact the manufacturing sector in Cameroon by increasing the unit costs faced by manufacturing industries. A major portion of these expenses is attributed to inputs, making it difficult for local enterprises to compete with foreign products, especially those entering the market due to trade liberalization, which reduces import prices. This situation restricts the sector's ability to grow and contribute to economic advancement.

What are the key challenges that Cameroon faces in balancing trade dynamics?

Cameroon faces several challenges in its trade dynamics, including increased imports coupled with stagnant exports, leading to trade deficits. The reliance on primary product exports, such as aluminum, rubber, and cocoa, exposes the country to exchange rate volatility and income instability. Moreover, dependence on imported household consumption goods further diminishes the benefits of trade opening, exacerbating the negative impacts on the manufacturing sector.

What strategies are suggested to improve Cameroon's economic outlook in the context of trade liberalization?

Given the negative impacts of trade opening on the competitiveness of the manufacturing sector, it is crucial for Cameroonian authorities to adopt a strategy focused on restructuring enterprises. This strategy should be complemented by an economic relaunch plan that prioritizes supply-side economics, emphasizing the strengthening of local industries and increasing their production capacity, rather than solely focusing on demand.