8, December 2023
CPDM Crime Syndicate: Biya wants Camtel to remain a public entity 0
Cameroon’s President Paul Biya opposes the privatization of the country’s incumbent telecoms operator, Camtel. The decision was the subject of a letter addressed on December 4, 2023, by the Secretary-General of the Presidency (SGPR) to the Minister of Finance (Minfi).
Ferdinand Ngoh Ngoh instructs Minister Louis Paul Motazé, also the president of the Interministerial Committee for the Rehabilitation of Public and Parastatal Enterprises, to suspend any rehabilitation plan aiming at privatizing Camtel or any segment of its operations. The SGPR’s letter follows Minister Motazé’s appearance before the National Assembly’s Finance and Budget Committee on November 15, 2023, where he defended the 2022 budget settlement. Responding to questions about Camtel’s underwhelming performance compared to other telecom operators, the Finance Minister revealed the government’s intention to restructure the telecom giant into three entities, forming a holding.
“Referring to Camtel’s low level of competitiveness, given the dynamism observed in the telecommunications sector, the Finance Minister acknowledged that the company’s performance was not up to expectations. For this reason, an inter-ministerial committee has been set up to examine the restructuring of the company. The government is currently considering how to improve the company’s performance. It is envisaged that the company will be transformed into a holding company made up of three entities”, reads the report on the work of the National Assembly’s Finance and Budget Committee, on the defense of the 2022 Settlement Act by the Minister of Finance.
The report also mentions the plan to alleviate the significant burden on Camtel, including its 4,000 employees and a heavy debt of CFA600 billion. However, the minister did not explicitly mention privatization during his presentation to the deputies.
Furthermore, sources close to Camtel’s rehabilitation discussions disclosed that a ministerial-level meeting took place to address the alarming situation of Camtel. Representatives from the Ministry of Posts and Telecommunications (Minpostel), the Ministry of the Economy (Minepat), and Camtel’s Director-General were present alongside the Minister of Finance (Minfi) and a representative from the Presidency. Contrary to claims of privatization, major proposals focus on reinforcing the autonomy of business units (fixed, mobile, transport) under Camtel, reducing staff, and addressing the substantial debt.
Since 2020, Camtel has held three licenses, covering the operation of electronic communications transport networks, fixed communications networks, and mobile networks. The Finance Minister’s revelation of the transformation project into a holding with three subsidiaries corresponds to the specifics of these licenses.
In response to the President’s opposition to privatization, discussions arise about the suggested holding structure. A holding, or “mother company,” can have its assets predominantly or wholly owned by the state or its entities, maintaining the company in the public domain. However, assets in both the holding and its subsidiaries could also be majority or wholly owned by private operators, aligning with the concept of privatization.
This proposed option, which the President opposes according to the SGPR’s letter, appears more reassuring to many telecom operators in Cameroon. Critics argue that Camtel, operating as a wholesaler managing infrastructure leased by other actors, competes directly with retailers, such as mobile operators and internet service providers.
A 2017 report entitled “Cameroon Economic Memorandum” by the World Bank supports this perspective, suggesting the government ends the monopoly of companies like Camtel and Bolloré in sectors producing essential inputs for other activities. During a workshop in March 2017 in the Cameroonian capital on determining reforms for improving the competitiveness of the ICT sector in Cameroon, the World Bank recommended transforming Camtel into a holding with two entities: one controlled by the state, managing infrastructure and fixed telephony networks; and another dedicated to mobile services and the marketing of home fiber optics, open to private investors.
Source: Business in Cameroon
15, December 2023
Cocoa price surge boosts incomes of Cameroon’s farmers 0
A sharp rise in the price paid for cocoa beans has boosted the incomes of farmers in Cameroon as top global producers Ivory Coast and Ghana suffer a supply shortage this season.
Several farmers told Reuters that they have been selling their beans at prices ranging from 2,000 to 2,200 CFA francs ($3.67) per kilogram, up from 750 to 1,290 CFA francs/kg last season.
New York cocoa futures rose to a 46-year high on Monday as crop problems in West Africa tightened global supplies. Ghana cocoa port arrivals are down around 50% year-on-year so far this season, while Ivory Coast’s are down more than 35%.
Cameroon is not expecting a similar drop in production. It targets around 300,000 metric tons of cocoa annually, making it the world’s fourth biggest producer in recent years.
“I have made much more money from cocoa sales, which has enabled me to clear an overdue loan,” said Susan Itoe, a cocoa farmer near Konye in the South West region.
Cameroon’s guaranteed cocoa farmgate price for the 2023/24 season was set at 1,500 CFA francs/kg. But the actual prices paid to farmers are flexible depending on the market and have risen even higher.
In Ivory Coast and Ghana, by contrast, prices are fixed for the entire season.
“Cameroon is benefiting from the malaise of Ghana and Ivory Coast following flooding and cocoa swollen shoot virus,” said Epie Promise Ngolepie, a cocoa consultant at agri-tech company Help Farmers Cameroon, who told Reuters that prices were expected to fall by 2025 as production picks up again in West Africa.
The high cost of inputs and high cost of transporting the produce due to bad roads were, however, eroding the gains, he added.
“Price has always been our problem… So this increase is well appreciated especially as we have improved the quality of our cocoa,” said Esapa Patrick Enyong, president of the South West Farmers’ Cooperative Union, which groups thousands of farmers in the country’s largest cocoa production basin.
Cameroon was recently added to Annex ‘C’ of the International Cocoa Agreement, which places it on the list of countries producing fine flavoured cocoa.
The liberalisation of the country’s cocoa trade since the 1990s has also contributed to the higher prices, said Michael Ndoping, General Manager of the National Cocoa and Coffee Board (NCCB).
“All these factors put together make the cocoa trade these days very encouraging and we hope this will last for some time,” Ndoping said.
Source: Reuters