Cameroon has implemented a sweeping tariff reduction on European imports, cutting customs duties by 70% for goods covered under the Economic Partnership Agreement (APE). The decision, announced by Finance Minister Louis Paul Motazé, applies to a third category of products deemed critical for public revenue streams. The phased reduction will see annual decreases of 10%, culminating in complete duty elimination by 2030.
The initiative targets key sectors, including commercial vehicles, fuels, cement, paints, and industrial packaging originating from the European Union and the United Kingdom. This move extends an existing schedule that already granted duty-free access to two other product categories. Since August 4, 2023, goods in the second group—such as plasters, clinkers, trucks, trailers, and generators—enter Cameroon without tariffs. Meanwhile, the first group, encompassing pharmaceuticals, fertilizers, pesticides, computers, gas cylinders, and tractors, has enjoyed similar exemptions since August 4, 2019.
Maintaining fiscal stability amid APE implementation
When the APE was first introduced, concerns arose about potential revenue shortfalls for Cameroon’s treasury. However, the projected fiscal impact has been far less severe than anticipated. Official data indicates cumulative customs revenue losses of approximately 103 billion FCFA over a decade, averaging just over 10 billion FCFA annually. While significant, this figure remains manageable within the broader economic context.
Surprisingly, Cameroon’s total customs revenue crossed the 1,000 billion FCFA threshold for the first time in 2023. This growth, occurring even as tariffs on European imports decline, stems from a strategic shift in trade partnerships. Diversification, particularly toward Asian markets, has offset the decline in European trade through expanded revenue bases.
China emerges as the unexpected winner of APE
The APE’s design intended to strengthen trade ties with Europe, but its unintended consequence has been the rise of China as Cameroon’s dominant commercial partner. Beijing became Cameroon’s top bilateral client and supplier in 2013 and has since solidified its position. A 2024 report by the National Competitiveness Committee highlights this transformation.
In the machinery and equipment sector alone, China’s market share surged from 23.8% in 2016 to 52.5% in 2024, a remarkable increase of 28.7 percentage points. Over the same period, the EU’s share plummeted from 50.1% to 29.3% in 2023 before partially recovering to 32.3% in 2024—a decline of nearly 20 points. This trend underscores the limited effectiveness of tariff preferences for European manufacturers against China’s aggressive pricing strategies.
Unequal distribution of APE benefits
An analysis of APE beneficiaries reveals structural disparities. As of December 31, 2023, fewer than 5% of the 1,021 companies utilizing the APE preferential tariffs captured approximately 75% of the fiscal benefits. The imbalance extends to business size, with large enterprises securing 80% of the gains, leaving only 20% for small and medium-sized businesses. This disparity reflects both the structure of formal imports in Cameroon and the varying capacity of businesses to navigate preferential customs procedures.
The National Competitiveness Committee notes that « an examination of the top 50 companies leveraging the APE preferential tariff shows a clear dominance of industrial and commercial sectors ». With full exemption scheduled for 2030, Cameroonian authorities face a critical decision: balancing historical ties with Europe against the realities of an economy increasingly shaped by China’s influence. Debates on revising the APE framework are already underway, driven by this economic reconfiguration.
