2013-03-13 17:36:08 - Recently published research from Business Monitor International, "Cameroon Business Forecast Report Q2 2013", is now available at Fast Market Research
Real GDP growth in Cameroon will climb above the 4.0% long-run trend for the next few years. This is on the back of investment in several new mega-projects and increased oil production.
Acute and systemic problems in the banking sector are likely to be addressed very slowly and only partially.
The probability that President Paul Biya will run for re-election in 2018 - and hence further delay planning for his own succession - is rising.
Major Forecast Changes
On the back of new data we have revised up our forecasts for import growth over the next three years. We now believe the regional central bank will hold its policy interest rate at 4.00% through 2013 and beyond.
Key Risks To Outlook
Political stability is likely
to persist, unless the ageing Paul Biya unexpectedly exits the presidency.
Positive price shocks to oil would help bring into balance the persistent current account and fiscal deficits.
Full Report Details at
- www.fastmr.com/prod/552226_cameroon_business_forecast_report_q2_ ..
Report Table of Contents:
Major Forecast Changes
Key Risks To Outlook
Chapter 1: Political Outlook
BMI Political Risk Ratings
No Successor for Biya
- While the 2018 presidential election is a long way away, there are indications President Paul Biya intends to run again (besides his own statements, there have been prosecutions that could be interpreted as designed to keep opposition voices in prison through the elections). To the extent this will prevent the authorities for preparing for life after the ageing Biya, such a decision will continue to exacerbate long-term risks for the country.
Long-Term Political Outlook
President's Longevity A Key Vulnerability
- Over the next 10 years, the single greatest uncertainty facing Cameroon is how a transition from the leadership of President Biya, who has ruled since 1982, will be managed. Despite this significant risk - and smaller challenges such as piracy - Cameroon is remains relatively stable, leading to our expectation of broad political continuity.
TABLE: POLITICAL OVERVIEW
Chapter 2: Economic Outlook
BMI Economic Risk Ratings
Investment Push Underway
- Cameroon is enjoying a period of above-trend growth that is likely to continue through at least 2015. Thereafter, declining oil production and the wrapping up of major investment projects should lead to a modest drop in growth, and a transition of the economy away from dependence on the shrinking oil sector.
TABLE: ECONOMIC ACTIVITY
Budget Deficits in 2013
- Cameroon's 2013 budget deficit should come in lower than 2012, but not by much. We continue to believe the government will fail to balance its budget for the foreseeable future, though shocks to the price of oil present upside risks.
TABLE: FISCAL POLICY
Balance of Payments
Trade Deficits Steady, Manageable
- While Cameroon's current account deficit is unlikely to narrow by 2017, we believe it will remain at manageable levels. Over the next two years, rising exports from oil will likely be offset by increased imports related to capital investment.
TABLE: CURRENT ACCOUNT
Slow Crisis In A Little Banking Sector
- Weak banking oversight by regional regulator COBAC has allowed problems in the banking sector to spread to four, possibly five, of Cameroon's 13 banks. We expect the resolution of these problems to take place at a very slow rate, and that much needed reforms to the regulatory structure will be similarly slow. Fortunately, the sector's linkages with the wider economy remain small, and we do not expect banking problems to spill over into the wider economy.
TABLE: MONETARY POLICY
Regional Monetary Policy
- Following revisions to the outlook for regional growth and a cautious statement by the regional central bank, we have changed our policy interest rate forecast from a 50 basis points hike over 2013 to a hold at 4.00% until inflationary pressures rise.
Chapter 3: 10-Year Forecast
Cameroon's Economy To 2022
Halting The Decline in Growth
- Over the next ten years we see Cameroon's growth exceeding long-run levels, with many of the gains front-loaded on the back of increased investment. A weak business environment and poor governance have long held down growth, however, and we expect them to continue to constrain over the decade to come.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 4: Business Environment
BMI Business Environment Risk Ratings
Business Environment Outlook
TABLE: BMI BUSINESS AND OPERATION RISK RATINGS
TABLE: BMI LEGAL FRAMEWORK RATING
TABLE: LABOUR FORCE QUALITY
TABLE: AFRICA - ANNUAL FDI INFLOWS
TABLE: TRADE AND INVESTMENT RATINGS
TABLE: TOP EXPORT DESTINATIONS
Chapter 5: BMI Global Assumptions
Brighter Outlook In 2013
TABLE: GLOBAL ASSUMPTIONS
TABLE: DEVELOPED STATES, REAL GDP GROWTH FORECASTS
TABLE: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS (%)
TABLE: EMERGING MARKETS, REAL GDP GROWTH FORECASTS
About Business Monitor International
Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets. BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports. Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports. View more research from Business Monitor International at www.fastmr.com/catalog/publishers.aspx?pubid=1010
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