In a bold move to strengthen trade relations, Cameroon has slashed import duties on European goods by 70%, as confirmed by a statement from Finance Minister Louis Paul Motazé. This decision aligns with the Economic Partnership Agreement (EPA) involving Cameroon, the European Union (EU), and the United Kingdom. The reduction targets a third category of products, deemed critical for public revenue due to their significant contribution to customs income. The phased approach includes an annual tariff reduction of 10%, culminating in the complete elimination of duties by 2030.
The new tariff cuts apply to utility vehicles, fuels, cements, paints, and industrial packaging originating from the EU and the UK. This adjustment follows an already accelerated schedule for the first two product groups. Since August 4, 2023, goods in the second category—spanning plasters, clinkers, trucks, trailers, and generators—have entered Cameroon duty-free. Meanwhile, products in the first category, which include pharmaceuticals, fertilizers, pesticides, computers, gas, and tractors, have enjoyed duty exemption since August 4, 2019.
Fiscal impact remains manageable for Cameroon
Initial concerns about the EPA triggering a severe budgetary shortfall have not materialized. Official data reveals that over a decade, customs revenue losses total approximately 103 billion FCFA, averaging slightly over 10 billion FCFA annually. While this figure is substantial, it remains within the country’s financial capacity when viewed against broader economic trends.
Remarkably, Cameroon’s total customs revenue crossed the 1,000 billion FCFA threshold for the first time in 2023. This growth, occurring despite declining tariffs on European imports, stems from a strategic shift in trade partnerships. Diversification toward Asian markets, particularly Asia, has offset the revenue erosion from Europe by expanding the tax base.
China emerges as an unexpected beneficiary
An ironic twist in the EPA’s implementation is that China has emerged as the biggest winner. Since 2013, China has held the top position as both Cameroon’s largest client and supplier. The 2024 Competitiveness Report from the Ministry of Economy highlights this trend in stark terms.
Between 2016 and 2024, China’s market share in machinery and equipment surged from 23.8% to 52.5%, a gain of 28.7 percentage points. Over the same period, the EU’s share plummeted from 50.1% to 29.3% in 2023, before stabilizing at 32.3% in 2024—a drop of nearly 20 points. This decline raises questions about the EPA’s effectiveness in supporting European industrialists against China’s aggressive pricing strategies.
Unequal distribution of EPA benefits
An analysis of the EPA’s beneficiaries reveals structural imbalances. By December 31, 2023, only 5% of the 1,021 companies utilizing the EPA’s preferential tariffs captured roughly 75% of the tax benefits. The disparity extends to company size, with large enterprises absorbing 80% of the gains, leaving just 20% for small and medium-sized businesses. This imbalance reflects both the structure of formal imports in Cameroon and the varying abilities of businesses to navigate preferential customs procedures.
The Competitiveness Committee notes that « an analysis of the top 50 companies benefiting from EPA tariffs shows a dominance of industrial and commercial sectors ». With full duty elimination set for 2030, policymakers face a critical decision: balancing Cameroon’s historical ties with Europe against the economic reality of China’s growing influence. Debates on revising the EPA framework are already underway, driven by this shifting trade dynamic.
