CAMEROON BUSINESS IN - CFA: The debate is open in the CEMAC - Business in Cameroon
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December 2019 - January 2020 / N° 82-83
BUSINESS IN
MAJOR PROJECTS
AGRICULTURE
CAMEROON
ENERGY
MINING
INDUSTRY
SERVICES
FINANCE
CFA: The debate is open
in the CEMAC
Aurélie Chazai: ”We are Cameroon becomes CEMAC’s
afro-optimists” financial center
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3
By Brice R. Mbodiam
Decentralization, let’s go…
No sooner had they reviewed and approved the 2020 budget that the
MPs were once again convened for a 15-day special session to review
and vote the draft law on the code of decentralized territorial units.
The session already started since December 13, 2019 and according
the government explanatory statement, the focus law gathers all
the legislative corpus for decentralized territorial units in a single
document.
Government says the drafting of this law is the concretization of
“public authorities’ desire to speed up and deepen the decentralization
process, reinforced by the recommendations resulting from the general
meetings of communes, as well as those of the national dialogue”.
Indeed, one of the outcomes of the national dialogue, initiated by
the Head of State to find a way out of the Anglophone crisis that
has been shaking the country since 2016, was to accelerate the
decentralization process and grant a special status to the northwest
and southwest regions. Decentralization was then chosen instead of
federalism, supported by some of the participants, and the secession
advocated by the separatists, who refused to participate in this great
dialogue.
It’s now effective that the country’s two Anglophone regions have
a special status, “based on linguistic specificity, which is expressed
through a particular educational and judicial system, the manage-
ment methods of which are laid down by specific laws”. But, despite
this measure, the law “emphasizes the need to respect national unity,
territorial integrity and the primacy of the State”. This means that
the government is not going for a partition of the country along
linguistic lines.
Beyond the decentralization acceleration vision that will also enable
the direct transfer of financial resources to local authorities (mean-
ing they will no longer be included in the budgets of ministerial
departments); the special status for Anglophone regions; or the reaf-
firmation of the country’s unity; the new law also meets a multi-year
request which is the suppression of government delegates’ posts in
major cities. They were kind of “super mayors” appointed to keep a
firm grip on the management of large cities despite the presence of
elected mayors. The fulfilment of this request was long awaited by
many policy entrepreneurs who advocated for it.
These significant changes contained in the draft law, which also
specifies the functioning of the regions to be set up in the framework
of the decentralization process, are to be commended despite the
controversy which seems more like identity affirmations rather than
real attempts to build a harmonious national community.
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
4
CONTENTS
FCFA INTERVIEW
08 • C EMAC: Challenges ouna Kadiri : “The African
18 • M
and directions Continental Free Trade Area
to accommodate will bring extraordinary
monetary stability opportunities to this
and development continent and its people”
financing
INTERVIEW
FOCUS 22 • A urélie Chazai :
“Returning
to Cameroon
might seem very
surprising and
risky to many”
12 • C ameroon and those foreign junior mining
companies full of unfulfilled promises
BUSINESS IN CAMEROON
13 • G eovic Mining could lose its permit for
Publisher
Nkamouna nickel-cobalt deposit Stratline Limited
15 • C &K Mining divests shares in Mobilong diamond Publication Director
project to Sino-American investor, following Yasmine BAHRI-DOMON
scandalous potential overvaluation Contributors
Brice R. MBODIAM, Sylvain ANDZONGO, Idriss LINGE.
16 • A fter it failed the Minim Martap bauxite project,
Operator
Hydromine announces giant hydro project in Médiamania Sàrl
Cameroon www.mediamania.pro
Design : Jérémie FLAUX,
17 • M
balam iron Project: Sundance relies on Translation : Schadrac AKINOCHO
AustSino, after several unsuccessful extensions of Advertisement
its agreement with the government regiepub@investiraucameroun.com
In Cameroon
17 • O
nly a year after it acquired shares in the Nkout
Albert MASSIMB, almassimb@yahoo.fr
Tel : 00 237 694 66 94 59
iron ore deposit from Affero Mining, IMIC is
Printing
already seeking Rotimpres, Aiguaviva, Espagne
a new buyer
Office - Distribution Cameroon
Albert MASSIMB, almassimb@yahoo.fr
LEADER OF THE MONTH Tel : 00 237 694 66 94 59
66 • E DF Pulse Africa 2019: Young Cameroonian
Free – cannot be sold
engineer wins the prize “Prix coup de cœur” with
www.businessincameroon.com - info@businessincameroon.com
off-grid power-generation solution
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020
5
NEWS IN BRIEF
PUBLIC MANAGEMENT P 27-39 ITC & TELECOM P 48-54
FINANCE P 40-43 ENERGY P 55-59
AGRIBUSINESS P 44-46 TRANSPORTATION P 60
INDUSTRY P 47 SERVICES P 61-62
WWW.STOPBLABLACAM.COM
Rumours, preconceived notions, clichés, superstitions,
urban legend: What is real? What is fake?
P 63-65
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
6
COMPANY OF THE MONTH
Glass factory Socaver boosts production
capacity with 5.3 bln CFA Francs investment
On November 15, 2019, Cameroonian different sizes and colors (35 cl, 100 cl, in Cameroon and neighbouring
minister of industry Dodo Ndocké 150 cl, etc.),” SOCAVER explains. countries such as Equatorial Guinea,
inaugurated the new facilities of local “This investment, made in a difficult Chad and the Central African
glass-making company SOCAVER context, is part of SOCAVER’s strategic Republic.
in Douala, the country’s economic plan launched in 2018 by the general In addition, thanks to its crate
capital. management, in order to make the production workshop created in
A subsidiary of SABC group, leader company a real expert in packaging 2014, SOCAVER, the company 28%
of the brewing market in Cameroon, (Ed.note: glass bottles, plastic crates, owned by the Société Nationale
SOCAVER invested the tune of 5.3 and preforms), oriented towards a d’investissements (SNI) and private
billion CFA Francs for the renovation greater diversification of its business- Cameroonians, also has an annual
of its oven number 2, and construc- es,” the company adds. production capacity of 2 million
tion of a PET preform production By launching the production of PET plastic crates (12 and 24 holes). At
workshop. preforms, SOCAVER, the only glass the same time, with the renovation of
“With this investment, SOCAVER now factory in the CEMAC Zone, is thus furnace No. 2, SOCAVER’s yearly glass
has a workshop with two preform completing its range of products melting capacity has increased from
production lines with a capacity of (glass and PET) to satisfy the PET 32,500 to 38,500 tons.
300 million preforms per year. This beverage (soft drinks, mineral Brice R. Mbodiam
will enable the production of bottles of water) segment’s packaging needs
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020
7
MONTHLY STATISTICS
55%
The Cameroonian government, via the Ministry of Water
and Energy, just launched a program to monitor, control
and optimize electricity bills in the public sector. According
to the program’s creators, it is aimed at reducing the coun-
try’s electricity expenditures, which average 41 billion CFA
Francs every year according to official reports.
1300
A study commissioned by the government reveals that
public lightning represents more than 55% of the electrici- Jean-Bernard Levy, CEO of Electricité de France (EDF), a
ty bills the government pays every year. shareholder in the Nachtigal dam construction project in
Central Cameroon, was on the dam’s construction site on
November 26, 2019.
During this field trip, accompanied by Cameroon’s
Minister of Water and Energy Gaston Eloundou Essomba,
it was revealed that more than 1,300 employees are already
working on this project, which was officially launched in
February 2019.
These employees, and many others to certainly be recruit-
ed, are working to deliver, in 2023, a 400 MW dam repre-
senting one-third of the country’s current power genera-
tion capacity.
1,250 CFA Francs
In Cameroon, cocoa farmgate price has been ever increas-
ing. Indeed, according to figures published by Système
d’information de filières (SIF), a system that provides up-
dated information about the coffee and cocoa sectors, the
maximum price per kilogram rose from 1,220 CFA Francs
in early November to 1,250 CFA Francs on November 21,
11 300 tons
2019.
This 30 CFA Francs increase recorded in the country’s pro-
duction basins at the end of the rainy season announces an
improvement in sales towards the end of the year since it
is a reflection of the growing demand due to the arrival of Between July and September 2019, Cameroonian log-
new cocoa processors in the country. gers exported only 11,300 tons of logs to the European
Union market. According to the International Tropical
Timber Organization (ITTO), these exports are down 20%
year-on-year.
In Central Africa, this decline in log exports to the EU is
also observed in countries such as the Central African
Republic (-17% to 13,200 tons), the DRC (-35% to 10,600
tons) and Equatorial Guinea (-64% to 2 900 tons).
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
8 FCFA
CEMAC: Challenges and
directions to accommodate
monetary stability and
development financing
During the extraordinary meeting, In December 2016, when CEMAC to strengthen foreign exchange
on November 21-22, 2019, the presidents met in Yaoundé, these re- reserves.
Heads of CEMAC member coun- serves were just over 50% of imports During an interview with Ecofin
tries expressed a common desire needs, raising public concern about Agency, Gabonese Finance Minister
to defend the stability of their the risk of currency devaluation. Roger Owono Mba, acknowledged
currency (XAF). At the same time, According to a report published in this problem. He finds it legitimate to
they indicated their will to see the November 2019, by the BEAC, the repatriate all the currencies resulting
current monetary cooperation region’s foreign reserves at end July from the exports of resources but he
agreements with the European 2019 reached CFAF XAF4272.7 billion also points out that discussions with
Union and France evolve. (66.21% of import requirements), mining and oil operators have raised
an improvement by a little over the concern that the Central Bank
The CEMAC Commission and the XAF1,000 billion compared with the should upgrade to the standards for
central bank BEAC were tasked with level it was a year ago. fund transfers. A requirement that
“proposing, within a reasonable time has not yet been met because this
frame, an appropriate plan leading to EXTERNAL POSITION implies going through international
the evolution of the common currency.” STABILIZED BUT CHALLENGES clearing entities, whose access is
To maintain domestic and external REMAIN TO BE ADDRESSED more demanding than the traditional
stability, the Beac has pursued a To achieve this result, the Central SWIFT system (normal transfer
restrictive monetary policy over Bank has taken many measures. mode).
the past three years. Its actions are The most important, and the most In sectors other than oil and mining,
aimed at maintaining the parity rate challenging to implement, is the new the implementation of this exchange
between the CFA franc and its refer- foreign exchange regulation. Under rate policy has not been easy. The
private sector, in Cameroon par-
ticularly, put strong pressure on the
“As for our monetary policy, it has so market, making the black market for
currency exchange seize the oppor-
far helped ensure financial stability in tunity. This change has highlighted
many problems. These include the
our sub-region. However, there is the alignment of commercial banks,
human resources within the Central
need to remain flexible for any reform Bank and its branches and even the
adaptation of economic operators
proposal” to the new procedures. However,
the implementation of a permanent
consultation and communication
ence currency (the euro). According this regulation, all foreign currencies strategy has helped stabilize the
to the monetary agreements with generated from exports by CEMAC situation.
France, this monetary stability countries, including products of the So far, the BEAC has been unable to
requires that the region’s foreign oil and mining sectors, which are overcome some problems. CEMAC
reserves always represent at least the leading products exported by member countries have agreed to
20% of CEMAC’s imports. the sub-region, must be repatriated make oil and mining agreements
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020
FCFA 9 available so that the BEAC can en- STABILIZATION OF THE considered that too much liquidity sure the revenues declared in these INTERNAL ENVIRONMENT IN represents a risk on foreign exchange sectors are in line with the signed PROGRESS… AT THE EXPENSE OF reserves and that this should guide contracts. However, according to DEVELOPMENT FINANCING the pace at which money is cut. our sources at the BEAC, no con- As far as domestic stability is However, in a context of economic tracts have been sent yet. The other concerned, Beac’s main focus is on diversification, States and investors challenge is that many non-bank reducing excess liquidity in the bank- in the subregion need cash to launch economic actors have not repatriat- ing sector and the monetary system. projects. Some analysts believe that ed their foreign currencies yet. It has reduced cash advances to pressure on the quantity of currency At the end of June 2019, the assets States, added new constraints to the in circulation is a problem for the of CEMAC residents held in foreign refinancing of commitments made financing of the subregion’s develop- banks still amounted to $5.2 billion by banks and undertaken the gradual ment. It would not take the econo- (XAF3,153 billion). The central reduction of cash injections into the my’s actual credit need into account, bank indicated in its discussions sub-region banking sector. It also but rather the willingness to solve a with the International Monetary announced an operation to reduce problem that has never arisen, name- Fund (IMF) that it had no details excessive liquidity for early 2020. ly the pressure on foreign reserves as on the nature of these assets but However, these actions, suggested a result of monetary creation. data collected by Ecofin Agency by the IMF, do not consider the fact At the Central Bank, there is also on the Bank for International on ground. They are based on the discomfort in pursuing this type of Settlements’ platform indicate that assumption that too much liquidity domestic currency stabilization pol- nearly $1.5 billion of these assets in banks could become a risk for icy. Challenges include the fact that are held by CEMAC households currency hedging if large volumes of excess liquidity concerns only a few while nearly $2 billion are owned transfer requests are made. Within banks, owned by foreign groups, with by businesses. the BEAC itself, experts have often restrictive lending policies. Another N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
10 FCFA
“THE NEW MONETARY COOPERATION MUST BE BUILT
ON THE BASIS OF SOLIDARITY BETWEEN THE 6 COUNTRIES
IN THE REGION”
Benjamin Ngongang, Associate Director in charge
of the Central African region at FinAfrique that
specializes in advice and accompaniment for re-
forms in the banking sector, was once the super-
visor of Banque de France, CEMAC’s monetary
partner. The native Cameroonian comments on
CEMAC Heads of State’s decision on the evolution
of monetary cooperation with France.
Analysts believe that a medium-term breach of
the guarantee provided by France could dest-
abilize CEMAC’s financial sectors and econo-
mies. Do you share this opinion?
BN: The termination of the CFA franc convertibility
guarantee provided by France to the CEMAC zone
for about 60 years now would obviously be a sig-
nificant change for the zone. With such important from an accounting point of view, over this long
reform, some may take a pessimistic view of the period and should be able to continue to do so with
future and fear a destabilization of the economy the additional autonomy that this reform would
and of the financial sector in particular. However, grant it. As long as the reform is carried out in an
this break can also be seen as an extraordinary op- organized manner, by involving from the outset all
portunity for the zone, which would then have the the stakeholders, there is no reason to fear a col-
opportunity to choose a new convertibility regime lapse at the end.
more adapted to its contemporary situation.
Indeed, at the beginning of the 1960s, when this What do you think would be the best scenar-
guarantee system was put in place, the countries io for the evolution of this monetary coopera-
of the CEMAC zone were barely officially joining tion?
the community of nations after their independ- BN: The new monetary cooperation must be built
ence, the solution of a French guarantee for the on the basis of solidarity between the 6 countries
young common currency undoubtedly reassured in the region, obviously strengthening the prin-
the countries of the region and their trading part- ciples of economic convergence and shared fiscal
ners, led by France itself, at the time. Today, the discipline, without losing sight of the structural
context is very different. CEMAC countries have differences between the economies. On the oth-
acquired experience in the joint management of er hand, as France is no longer the main trading
their currencies and foreign exchange reserves; partner of the region, the new currency should
trade partnerships have evolved with the arrival, be pegged with a basket of currencies that better
in the early 2000s, of Chinese, Indian and Turkish reflect the region’s international trade, with an
players which are gradually weighing heavily in autonomous target for the Beac, on the exchange
the trade balance of the CEMAC zone. The French rate and price stability objective.
guarantee no longer seems really essential in such Finally, we believe that this transformation should
context. It is also worth mentioning that this guar- be achieved by strengthening governance and
antee has almost never been used because, in 60 transparency within institutions. This must be
years of existence, the operating accounts have done gradually, with clear milestones and the in-
rarely been negative. Even during the sharp de- volvement of the region’s economic and financial
valuation of 1994, the level of reserves had fallen actors so that they will be ready to implement the
sharply without, however, becoming negative. new rules when the time comes.
Beac has, therefore, managed its reserves well,
Interview by Idriss Linge
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020FCFA 11
problem is that if the Central Bank A new development may lie in the African version of the euro), a parallel
stops its liquidity injections, banks, stated desire to review monetary monetary mechanism called the dual
whose failure would be a major cooperation with France and the currency system. This would unlock
problem for the sub-region’s financial European Union. The definition the potential of productive sectors
system, would find themselves in of the scope and content of this boosted by the dual requirement for
difficulty while their balance sheets evolution has been entrusted to the external and internal stability of the
and governance are quite good. CEMAC Commission and the BEAC currency.
but already, we have felt a differ- Nigeria’s experience can also be
WHAT ARE THE PROSPECTS ence in approach among the Heads inspiring. There, the Central Bank did
FOR MONETARY COOPERATION of State. While Teodoro Obiang not limit itself to setting up mone-
WITH FRANCE? Nguema of Equatorial Guinea sees tary policy mechanisms. It reduced
In his closing speech, Cameroonian this as an opportunity to be free from banks’ access to foreign currencies
President Paul Biya recalled the the long-standing monetary partner for the financing of basic needs. The
need for flexibility. “As for our mone- (France), Denis Sassou Nguesso of other foreign exchange needs are
tary policy, it has so far helped ensure Congo believes that they must take met by the money market (Nafex). In
financial stability in our sub-region. more responsibility. addition, it prohibited commercial
However, there is the need to remain There are plenty of avenues for reflec- banks from investing in treasury bills
flexible for any reform proposal tion. One of them is defended by the and bonds. The objective is to reduce
aimed at consolidating its action and Cameroonian statistician Dieudonné excess liquidity in the monetary
ensuring the best conditions for an Essomba. The latter, who was already system while ensuring that produc-
effective contribution of monetary predicting this crisis situation in the tive sectors are financed, to support
policy to the development of the CEMAC region, had suggested creat- diversification.
sub-region,” he said. ing, alongside the FCFA (which is the Idriss Linge
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON12 FOCUS
Cameroon and those
foreign junior mining
companies full of
unfulfilled promises
In November 2019, two major events Codias commits to exploiting, at an have fallen on companies with just
occurred in the Cameroonian mining industrial scale, the 480,000 tons promises but no actions. On close
sector. Indeed, within days, the gov- Colomine gold deposit in the Eastern observation, these operators seem
ernment signed iron and gold mining region. The overall investment for more concerned about the impact
agreements with two local mining this project is estimated at XAF40 of speculation organized around
companies. The first agreement was billion, according to official sources. Cameroonian mining licenses on
signed with Cameroonian billionaire This is the first time the international stock exchanges than
Dieudonné Bougne’s G-stones which Cameroonian government is placing about the effective development of
plans to invest XAF900 billion in such high level of confidence in local the country’s mining potential.
partnership with Canadian investors investors operating in the mining Consequently, the mining licenses
for the exploitation of Akom II iron sector. Therefore, many observers the country attributed to them are
deposit in the Southern region. The see in those conventions signs of the being traded but there are no bene-
investment project includes the con- government’s hopelessness with the fits for Cameroon and the pompous
struction of a steel plant in Fifinda, numerous unfulfilled promises of for- announcements of exploitation of
also in the South, to process the ore eign mining companies that signed mining deposits, covered by those
mined from the Akom II deposit. such agreements with Cameroon. licenses, are not followed by actions.
The second mining company Indeed, from American Hydromine, Here is a look back at those mining
Cameroon trusted for mining Australian Sundance Resources, projects that raised a lot of hope, but
operations is Bonaventure Mvondo Canadian-American Geovic to have gradually led to despair.
Assam’s Codias. Through the agree- Korean C&K International, the Brice R. Mbodiam
ment signed on November 29, 2019, Cameroonian government seems to
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020FOCUS 13 Geovic Mining could lose its permit for Nkamouna nickel-cobalt deposit In recent days, we learn more about authorities let him keep the mining sell the project’s shares to the highest the audience granted on February permit, which its local subsidiary has bidder,” a source said. 21, 2018, to William Alan Buckovic, held for 16 years but has produced founder of American-Canadian no concrete performance so far. PROJECT ABANDONED AFTER A Geovic Mining Corp, by the General What happened is, given Geovic FAILED ASSET TRANSFER Secretary of Cameroon’s Presidency, Mining’s inability to develop the According to local sources, there has Ferdinand Ngoh Ngoh. The company Nkamouna project since 2003, the been no activity on the Nkamouna has held, since 2003, Cameroon’s very Cameroonian government has been site since 2013, equipment at the first mining permit, granted for the considering, since late 2017, with- headquarters in Yaoundé have been Nkamouna nickel-cobalt-manga- drawing the permit and subsequently removed and it seemed clear that nese deposit, located in the Eastern launching an international tender to Geovic gave up on the project. This district of Lomié. recruit a new partner who, it hopes, happened after the junior mining During that meeting with the would succeed where Geovic failed. company failed to sell its assets on General Secretary, sources close to “Geovic cannot develop the Nkamouna the project to Chinese Jiangxi Rare the matter say, Buckovic announced mining project simply because it has Metals Tungsten Group Holdings his company is going to resume ac- no resources. The proof is that they Company Ltd (JXTC). tivity on the project following a dead have not done anything for 15 years On July 23, 2013, Geovic Mining Corp period of 6 years and pleaded that (16 years today, ed). They just want to had announced that it had signed N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
14 FOCUS
a “definitive agreement” with the National Investment Company (SNI), for non-compliance with the rules);
Chinese company. “This final agree- which represented the local partners This is a real disappointment for the
ment represented a significant pro- and controls 39.5% of the project was populations of the Lomié district,
gress for the operation of the project not satisfied with the Chinese side. who have once dreamed that the
in Nkamouna. The development of the This unsuccessful transaction is only town of Nkamouna would become
project will start as soon as funds are one of many others either due to home to Cameroon’s first cobalt
available and will allow the creation unfulfilled promises, hesitations, or a mine. “In any case, no one listens to
of jobs and diversify the economy of constant revaluation of the potential them here anymore. The populations
Cameroon,” said Michael Mason, CEO of the Nkamouna deposit. As a result, no longer believe in it,” Célestin
of Geovic Mining Corp. sources say, the Geovic shares con- Assama Mbongo, former mayor of
But what had been presented as a tinued to rise on the Toronto Stock Lomié, told Business in Cameroon in
“definitive agreement” in July 2013 has Exchange in Canada (it was finally December 2014.
not be respected by the parties. The excluded from this market in 2014
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020FOCUS 15 C&K Mining divests shares in Mobilong diamond project to Sino-American investor, following scandalous potential overvaluation C&K Mining, which has held a permit for the Mobilong diamond deposit in eastern Cameroon since December 2010, has transferred the majority of its assets in this mining project to a Mr. Yang, a Chinese billionaire resid- ing in Hong Kong, who sources said is also a US citizen. In this regard, C&K Mining held a general meeting on November 19, 2014, in Yaoundé, after a board meeting in Seoul on November 2, and announced that Mr. Yang is the “new majority sharehold- er” of this mining company. C&K Mining was a joint venture between Koreans and Cameroonians. Following the transaction, the Korean partners who were previously majority shareholders with over 50% stake now only control “less than 10%.” The amount invested by the leading Korean public figures and According to our sources, Paul Ntep Sino-American investor has not been the heads of C&K International, the Gwet who has virtually worked on all disclosed but operations took place parent company of C&K Mining, took mining projects in his country was since “late 2013.” advantage of the opportunity, selling invited as witness on behalf of C&K The assets were sold after the at the higher price before it later Mining to reassure Korean justice on Mobilong diamond mine scandal in declined. the real existence of a world-class South Korea in December 2010. That diamond deposit in Mobilong in East year, C&K Mining, which explored QUESTIONED, BUT NEVER Cameroon. CAPAM has a 10% stake the deposit in 2006, was accused of DENIED in C&K Mining, a company he helped over-evaluating its potential (initially Legal action was taken against the to create with Korean partners and 736 million carats, or 5 times global Korean mining company whose other national operators. production, followed by a readjust- chairman, Deuk Gyun Oh, was Although the Mobilong diamond ment which brought the figure down arrested and jailed in Korea in deposit’s potential is questionable, to 420 million carats) in order to February 2013, before being freed no credible contradiction has so far speculate on the Seoul stock market. in September 2014. This occurred been made against C&K Mining’s Indeed, after receiving the mining following a long hearing (9:00 am 420 million carats estimate. But all permit in December 2010, and to 7:00 pm) in the Seoul Court of parties agree that this is a world- following the initial projection Justice on September 15, 2014, with class deposit. Especially thanks to being declared inaccurate, C&K Cameroonian Paul Ntep Gwet, its conglomeratic part, which is not Mining’s stock rose on the Seoul former Coordinator of the Small- estimated yet but considered more stock exchange, multiplying its scale Mining Support Framework important than the alluvial part, going selling price “by 4.6 in only 16 (CAPAM), a governmental program whose total potential is estimated at days,” stated Frederic Ojardias, an governing small-scale mining in only 230,000 carats of diamonds. RFI correspondent in Korea. Many production zones. N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
16 FOCUS
After it failed the Minim Martap
bauxite project, Hydromine announces
giant hydro project in Cameroon
US-based energy company of “any activity launched by businesses the joint venture created for this
Hydromine said it has plans to build, in accordance to Cameroon’s legisla- purpose, developed the project until
over a period of 5 years, a 2 billion m3 tion.” An objective which perfectly 2016.
dam and a 1,800 MW power genera- fits the reputation of this firm in the For “failure by CAL to provide all the
tion unit (higher than the 1,500 MW country. final preliminary studies on all the
currently produced by the country, It should be recalled that Hydromine components of the project (baux-
ed) in Cameroon. Projects will be de- somehow bluffed on a significant ite-alumina), with an integrated
veloped in the Littoral region, and are project involving bauxite exploita- financial model, on the one hand,
part of a bigger project called Grand tion in Minim Martap and Ngaoundal and Dubal Alumina’s feverish desire
Eweng, initiated by the company. in the Northern part of Cameroon. In to continue to invest in the project, on
Hydromine had already gotten the fact, Hydromine, which appeared, at the other hand,” the Cameroonian
green light from authorities and the time, to be just a minor American government was unable to conclude
an agreement was signed in that start-up with no offices, financial a mining agreement with CAL.
regard on April 6, 2015, a month after resources or even mining expertise, Cameroon also withdrew the
Peter Lionel Briger, the promoter of said it would invest around 5,000 licenses for the project from this
Hydromine, established Hydromine billion FCFA in the bauxite project. company and sold them to Canyon
Cameroon Ltd in Douala, with an Resources in 2017. Through its local
initial capital of 1 million CFA Francs. WITHDRAWAL OF LICENSES unit Camalco, Canyon Resources
The company claims, without any Unable to manage the Minim Martap committed, according to a source
proof so far, that it has increased this and Ngaoundal bauxite project, close to the project, to mobilize more
capital to 600 million CFA Francs and Hydromine eventually entered into than 6 billion CFA Francs to meet
is considering bringing it to 1 billion a joint venture with Emirates Dubal specifications that extend over a
CFA Francs. Alumina and India’s Hindalco, to 3-year non-renewable period.
This firm is socially dedicated to the retain only residual shares in the
establishment of energy projects and project. Cameroon Alumina (CAL),
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020FOCUS 17 Mbalam iron Project: Sundance relies on AustSino, after several unsuccessful extensions of its agreement with the government Australian junior mining company Sundance Resources and AustSino decided on 22 October 2019 to ex- tend the deadline for finalizing their equity investment agreement for the Mbalam iron ore project in eastern Cameroon to 30 June 2020. The two companies expect that be- fore that date, Cameroon will reach a new agreement for this project rights on this iron project to June on track. Indeed, the agreement since the old agreement between the 2019 but its wish was not granted. between the two companies provides country and Sundance Resources’ Maybe, Cameroon was scalded by the for the transfer of majority shares subsidiary Cam Iron expired in Australian company’s inability to find in Sundance to AutSino, which will March 2019. financial partners for the project. then develop the Mbalam mining Sundance Resources, which was Anyway, Sundance Ressources sees project, which includes the construc- looking for investors, was hoping AustSino as the investor that will tion of a mine and a railway of more that Cameroon would extend its put the Mbalam iron project back than 500 km. Only a year after it acquired shares in the Nkout iron ore deposit from Affero Mining, IMIC is already seeking a new buyer British company International CFA Francs each represent 49.5% of important in Cameroon, ahead of Mining & Infrastructure Corporation Caminex’s assets, IMIC specified in the Mbalam-Nabeba iron deposit (in (IMIC), which bought the shares its statement. This call for funds, the the east of the country), 2/3 of which of Affero Mining in the Nkout iron final results of which are still not yet is located in Congo. In December project, in Southern Cameroon, an- revealed 4 years later, reveals IMIC’s 2014, IMIC announced a revaluation nounced it has decided to sell 4,903 difficulties in developing the Nkout of the potential of the Nkout deposit shares of its Cameroonian subsidiary, iron project, in an international to 2.7 billion tons of iron resources, Caminex. The decision was taken context marked by the continuous with a 68% growth on DSO (directly during a general meeting held on 15 decline in the price of this metal. exportable ore). December 2015. As a reminder, the Nkout iron These shares with a value of 10,000 deposit is presented as the most N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
18 INTERVIEW
Mouna Kadiri
“The African Continental
Free Trade Area will
bring extraordinary
opportunities to this
continent and its people”
Mouna Kadiri is the director of the Africa
Development Club, which belongs to the Moroccan
Attijariwafa bank’s group. She recently co-chaired
with Cameroon’s minister of trade the third edition
of the Africa Development Club’s conference, in
Douala. In this interview, she talks about the Club’s
actions to benefit African entrepreneurs; this is
as the Continental Free Trade Zone is about to be
launched.
Business in Cameroon : Recently, nies.” The theme was picked by SCB recent years. They are mostly due to
the Africa Development Club Cameroon (subsidiary of Attijariwafa exchange regulations, key reforms
held a meeting focused on trade, Bank) and the African Development introduced by the government, and
a meeting which you co-chaired. Club in Cameroon. These two firms a will (of the government and the
Why did you pick this topic are the most fit to identify the most private sector) to make them more
particularly? relevant topics to foster investment visible. It was based on these changes
Mouna Kadiri : This was a multi- and value creation, for both local and that the committee that worked
sectoral mission around the theme international firms. Cameroon has on the meeting decided that trade
“Trade as growth leverage for compa- recorded various transformations in would be a great theme, given its
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020INTERVIEW 19
“Regardless of its origin or identity, any business that can contribute to the development of a community, create jobs, pay taxes, improve the lives of people or
infrastructure, in Africa, is welcomed by the Africa Development Club.”
huge potential for value creation to your club to better profit from initiative to create economic val-
through deals, joint ventures, etc. the African continental free trade ue, ---. Truth is, this zone marks the
The main component of the meeting agreement (AfCFTA)? beginning of something big and with
were the business meetings organ- MK : Long before the AfCFTA project it, we can achieve historical records.
ized after discussions between key came up, we had been operating for We can affirm that this free-trade
speakers. The latter included some 10 years, with no free trade zone. We zone is not only the materialization
top officials such as the minister of had, as you may guess, to deal with of a strong political will but also a
trade, who sponsored the mission, multiple challenges, related to infra- project aimed at bolstering econom-
the deputy national director of the structure, administrative procedures, ic value since we already cooperate
Bank of Central African States, and transport, and logistics. Over the pe- among ourselves, even without it.
the chairperson of Telcar Cacoa, riod, we brought together more than Our role since the last edition of
Mrs. Fotso. During these business 10,000 operators. This took us six the Africa Development Forum
meetings, participants were able to editions of the Africa Development themed “When East meets West,”
exchange on investment opportuni- International Forum, which generat- is to primarily inform, connect,
ties, deals, and joint ventures. ed more than 22 business meetings. and get operators to engage in the
They also visited the autonomous The latter yielded concrete deals, daily activity of businesses; raise
port of Kribi, which is a major project investments, factories, among others awareness of economic operators
considered as a hub in Central Africa. - transactions worth millions of about the African Continental Free
They were able to appreciate the dollars. Trade Area, which is key to boosting
enormous infrastructure, as well as The first challenge to tackle is to business opportunities, in line with
its modern aspect. This helped build help businesses build a relationship the continent’s 2020-2025 strategic
trust with economic operators and of trust with their partners. This plan for trade.
that is mainly why we picked trade as way they will have an axis for value We also wanted to break from the
our main theme. creation and that is exactly the old habit that African countries got
purpose of the free-trade area. Our into since independence. Indeed,
BC : So, the Club is not only an role is to be the flag-bearer of Africa’s we are used to North-South, South-
organization but a real tool that private sector, tell the world: “Yes! South cooperation, as well as to
is building tomorrow’s African It is possible, we create jobs.” Some France and UK centered trade. Well,
trade industry. Concretely, how affirm that this free-trade zone is not we wanted to end this and connect
do you help businesses affiliated only a political act, but also a strong major regions, large cultures, and
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON20 INTERVIEW
“It is time we become real actors and take our responsibilities. It is not really obvious nowadays where given shareholders of a company are each located, so instead
of focusing on origins of economic operators, we’ve decided to concentrate on creating added value across businesses in Africa.”
major cultural groups. To this end, We must preserve this dynamic. We Club, there is a great bank group
we invited representatives from must protect it, and though this will like Attijariwafa. But you also said
Kenya, Rwanda and Sierra Leone to be a long journey, we are convinced there were other banks such as
be guests of honor of our forum. that the African Continental Free Spain-based Banco Santander, or
We also had some from Nigeria, and Trade Area will bring extraordinary the Al Mada Pan-African Fund. Tell
even China; all to break old habits, opportunities to this continent and us, how do all these institutions
mix things up in the way we work. its people. plan to finance intra-African trade
This sharing of experience must yield which you support?
impressive insight on optimal coop- BC : Nowadays, trade and finance MK : First, let me tell you how our
eration methods. It must help foster almost go in pairs in Africa and Club operates and the model we
an intra-Africa collective mindset. behind the Africa Development have adopted. We have decided
to connect and regroup all banks
of the Attijariwafa Group, as well
as communities it works with,
“This helped build trust with both private and public. Next, we
had support from a Pan-African
economic operators” investment fund, which is Al Mada,
Attijariwafa’s reference stakeholder.
We were also among the founders
of the Trade Club Alliance, which
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020INTERVIEW 21
“Our role is to be the flag-bearer of Africa’s private sector, tell the world: “Yes! It is possible, we create jobs”
regroups 14 partner banks. The BC : While this idea is original, the This is a new path. We, Africans, don’t
Attijariwafa Bank Group is the only Africa Development Club comes know one another enough and this
African lender, besides a South behind others like China, Japan, brews clichés and in the worst-case
African bank (Ed.note: Standard India, or Russia. These economies real social disasters. Based on this
bank), to be part of this alliance are entering the African continent assessment, we focused on suppress-
which currently covers 65% of leveraging similar initiatives. Do ing barriers, providing reliable data,
global trade corridors. you consider them as potential connecting, supporting, encouraging,
The alliance was created at the partners, rivals or maybe both? and nurturing the interest sparked by
beginning of October 2019. It is a MK : Our vision is to contribute to African businesses.
digital platform that helps entities Africa’s development, but this vision You may be aware that Africa does
such as the Africa Development is not Afro-centered. Regardless of its not only consume what foreign part-
Club operate better. It provides origin or identity, any business that ners decide they should. Recently,
support, networking opportunities, can contribute to the development there have been some eloquent
access to reliable market data, and of a community, create jobs, pay speeches in this regard. It is time we
financial support to its members. taxes, improve the lives of people or become real actors and take our re-
A key contributor to the alliance is infrastructure, in Africa, is welcomed sponsibilities. It is not really obvious
Banco Santander. To date, the alli- by the Africa Development Club. nowadays where given shareholders
ance gathers more than 16,000 busi- However, we are pragmatic and we of a company are each located, so
nesses. It is our pride to have major know that out there, on the field, instead of focusing on origins of eco-
international banks praising the African businesses come first. What nomic operators, we’ve decided to
Africa Development Club, referring we do is tear down all invisible, psy- concentrate on creating added value
to us as being extraordinary. They chological walls that exist between across businesses in Africa.
not only praise us but all African Africans with different backgrounds
businesses which we represent. and cultures, all over the continent. Interview with Idriss Linge
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON22 INTERVIEW
Aurélie Chazai
“Returning
to Cameroon
might seem very
surprising and
risky to many”
After working for many major law firms in France,
this Cameroonian lawyer and legal advisor decided
to return and serve her country in 2017. Chazai
& Partners, is the firm she founded and a dream
come true for a woman who dared to believe in
her country. In this interview, she shares her very
unusual story.
Business in Cameroon: Could you market shares in an environment a difficult business environment?
tell us about your beginnings in where we were unknown. The main AC : As afro-optimists, we tend to
Cameroon? When did you start challenge at first was to convince see the glass half full rather than
your activity and under which prospects and clients to reach out half empty. However, operating in
conditions? to us. Cameroon’s legal industry is quite
Aurélie Chazai : We started in complex as many see this sector as
November 2017 with a team of only BC : What pushed you to decide to corrupt. What we have therefore
two people. No one knew about us return to set a business law firm in decided to do is provide a different
in Cameroon so we had to secure a country which is known to have service, one based on good ethics,
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 202024 INTERVIEW
a structure that gives them access to
the international market.
BC : Being at the centre of legal
talks between investors and even-
tually public authorities, what do
you make of Cameroon’s business
law? Do you think it enhances
businesses’ competitiveness in its
actual state?
AC : Let’s not play ostrich here.
Things can be improved in this area.
Cameroon’s ranking in the latest
edition of the Doing Business index
is not really the best. We can make
some improvements, in the govern-
ance area, for example, to be more
attractive to investors interested in
Cameroon. We try to reassure foreign
“Our goal was to provide a different economic offer: we wanted to make sure that economic operators investors by telling them that not all
have access to local experts for their major transactions, instead of necessarily resorting to firms based is bad in Cameroon, that there are
in London or Paris.”
some people, both public authorities
and civil servants who do their job
very well. So, they can discuss with
diligent work, and a reliable report to AC : It is true, looking at corruption serious and competent people, who
our clients. That was what drove us, in the Cameroonian legal system, can support their investments in
with a little naivety, to come back to that some things must be im- Cameroon.
offer our services in Cameroon. proved in regard to management. We have success stories here in
Regardless, there are real opportu- Cameroon, companies that came to
BC : There were other lawyers nities in our daily activity, especially invest and were happy about their in-
already established in the country. as more and more companies need vestments. Some of them have been
What added-value did you bring structuring. Cameroon is not in Cameroon for more than twenty
and what was, in your opinion, the isolated from the rest of the world. years. And though we tend to often
factor that would be decisive to We are the driving force of Central talk about what is wrong, we should
your success? Africa. We have business relations also talk about what goes well.
AC : Our added-value compared to
already established firms was that
our associates already had some
experience at the international “Returning to Cameroon might
level. We had been trained and had
worked at major firms in Paris, and
seem very surprising and risky
other places in Europe. Also, we had to many.”
a different look on things. Our goal
was to provide a different economic
offer: we wanted to make sure that with other countries so, economic
economic operators have access to operators in Cameroon need to have BC : What challenges did you face
local experts for their major transac- a specific structure and that is where as you launched your firm?
tions, instead of necessarily resorting legal advising comes in. AC : Our biggest challenge was to in-
to firms based in London or Paris. There could be legal frictions if some vest in a sector which was not really
decisions fail to be executed or are known. There were many obstacles
BC : Tell us a bit about legal advis- executed poorly. Fortunately, there on this path. Talks with the adminis-
ing in Cameroon. Do you believe are ways to avoid these, through tration, the fact that we had to find
there are opportunities or things advising. We intervene before reliable partners are some of the
to improve in this sector? conflicts by helping businesses adopt obstacles we had to overcome. Then,
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 2020INTERVIEW 25
“We had no issues regarding human resources.There are a lot of very well trained lawyers and jurists in Cameroon”
there was the issue of trust. Being tend to go to much older lawyers, team. Another challenge was how
a team of young people, securing a with more experience. We had to put other lawyers in the country treated
spot on the market is not the easiest a lot of efforts into convincing our us at first, as they were not really
in Cameroon. We, therefore, had to prospects and clients to trust us. On used to the innovative communica-
convince clients and prospects to the other hand, we had no issues re- tion methods we practiced. All these
trust their cases with us, even the garding human resources. There are actually forced us to build ourselves a
most sensible involving millions of a lot of very well trained lawyers and spot in Cameroon.
CFA francs. jurists in Cameroon. It was fairly easy
In effect, in such conditions, people to put in place a reliable and strong BC : As a woman, what challenges
do you face while running your
business daily?
“As afro-optimists, we tend to AC :The only true issue here is trust.
Often, when a case is handed to a
see the glass half full rather man, he is not asked for a cascade
of references beforehand. However,
than half empty.” when it comes to a woman, a young
one, in addition, most people ask for
more assurance than they would if
N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON26 INTERVIEW
“What actually pushed me to take action was realizing that most Africans flying abroad were flying third-class whereas foreigners coming to Africa would fly business
class.This means that foreigners come here to make money while we go to Europe to survive.”
they were working with a man. This BC : You decided to leave France was realizing that most Africans
is not specific to our profession, it to return to Cameroon in 2017 flying abroad were flying third-class
happens in all economic sectors. while many Africans move to the whereas foreigners coming to Africa
Regardless, instead of complaining Western part of the world seeking would fly business class. This means
about it, I see this as an opportunity greener pastures. You have taken that foreigners come here to make
for us, women, to do better than the the opposite path. Why did you money while we go to Europe to
rest. Once you show how competent pick this path which may seem survive. I just thought there is really
you are, everyone forgets that you surprising to many? something to do in Africa and also I
are a woman. Women working in AC: It is true that my choice of believed that Africans must under-
this field must be highly resilient and returning to Cameroon might seem stand that our continent is full of
perseverant. very surprising and risky to many, opportunities.
especially given that 2017 was a year
BC : With such a demanding work, when things started getting difficult Interview by Idriss Linge
how do you reconcile your job as in Cameroon. Regardless, I thought and Jean Christian Bernard Nselel
legal advisor with your family life? that was the right move and what
AC : Being a woman and having to actually pushed me to take action
run a legal advising firm while also
managing my family, it is crucial to
have a support system. It is crucial to “What we have therefore decided
have a caring, understanding, and at-
tentive family. In my case, I am lucky to do is provide a different service,
one based on good ethics, diligent
enough to have a very understanding
husband who is also a very good
father. This allows me to be fulfilled
professionally, without feeling guilty work, and a reliable report to our
personally. That’s something I’m
lucky to have.
clients.”
BUSINESS IN CAMEROON N° 82-83 / December 2019 - January 202027 PUBLIC MANAGEMENT Government submits penal code amendment, punishing tribalism, before parliament During the November 2019 budget from XAF5,000 to XAF500,000. This 3 million. If mitigating circumstances session, the Cameroonian parliament fine is increased to XAF20 million are admitted, the prison sentence will review a draft amendment to if the offence is committed via “the may be less than 3 months and the the Penal Code. The purpose of this press, radio, television, social networks fine XAF200,000. These penalties are amendment is to introduce provi- or any other means likely to reach the doubled when the offence is com- sions punishing racial, religious and public.” These penalties are doubled if mitted by a public official, a political tribal vilifications. the offence is committed to incite ha- party official, a media official, an According to the draft text submitted tred and contempt between citizens, NGO or a religious institution. to parliamentarians for consid- the draft indicates. This draft text appears as a response eration and adoption, racial and As far as tribal vilification is con- to the hateful and tribal speeches religious vilifications will now be cerned, the offence is punishable by in Cameroon, mainly on social punishable by prison terms ranging imprisonment of one to two years, networks, since the October 2018 from 6 days to 6 months, with fines with a fine between XAF300,000 and presidential election. Refugee assistance: Cameroon obtains over XAF77 billion from World Bank On November 19, 2019, in Yaoundé, four projects funded by the “the IDA18 regional sub-window for refugees and host communities” were officially launched. According to Abdoulaye Seck, Country Director of World Bank operations in Cameroon, the total financing amounts to $130 million (a little over XAF77 billion), includ- ing $86 million (Over XAF51 billion). “It is important to recall here that Cameroon was the first African coun- try to benefit from the IDA 18 special refugee window. This is in recognition of the country’s generosity and its long tradition of solidarity and hospitality income-generating activities for poor level, where the same organizations towards displaced people,” Abdoulaye and vulnerable households will enable and community relays can facilitate Seck said. them to bear the direct and indirect different activities. The objective is Specifically, in the framework costs associated with these services,” that the sum of the efforts should be of the projects launched, “basic the country director explained. greater than the fragmented efforts, services such as education, health “To this end, the four projects will and this, for a maximum impact on and nutrition will be provided to have to be implemented together at the communes and host populations,” populations, while cash transfers and all levels, especially at the communal he indicated. N° 82-83 / December 2019 - January 2020 BUSINESS IN CAMEROON
28 PUBLIC MANAGEMENT
National dialogue: The AU, la Francophonie,
and the Commonwealth inquire about the
implementation of recommendations
Paul Biya, President of Cameroon, can count on the constant support It has been almost three years since
received on November 27, in and accompaniment of the African a socio-political crisis broke out in
Yaoundé, a joint mission of three Union, the Francophonie, and the northwestern and southwestern
international organizations, led Commonwealth in its efforts to resolve Cameroon. The said crisis began with
respectively by the President of the the crisis in the North-West and South- corporate demands from lawyers
African Union Commission Moussa West,” the Presidency reports. and teachers but turned into violent
Faki Mahamat, the Secretary-General “We believe that we have an obliga- separatist claims with armed groups
of International Organisation of tion to contribute modestly through spreading death and desolation.
La Francophonie (OIF) Louise advice, interventions in mediation According to the United Nations
Mushikiwabo and the Secretary- activities or on technical subjects such High Commissioner for Refugees,
General of the Commonwealth as bilingualism and multiculturalism,” 21,291 Cameroonians fled violence
Patricia Scotland. said Louise Mushikiwabo. Patricia and fights between secessionists
According to the Presidency, this Scotland, for her part, said that the and the army, towards Nigeria. The
mission came to inquire about Commonwealth is committed to NGO International Crisis estimates
developments of the situation in the doing everything possible to support that about 2000 people died after
English-speaking regions (North- the ongoing peace process initiated 20 months of fighting. The UNICEF,
West and South-West) and on the through National Dialogue. “The on its part, indicates that the
implementation of the recommen- President of the Republic has once widespread insecurity has forced
dations of the National Dialogue again expressed his willingness to more than 4,400 schools to close in
held from September 30 to October engage in dialogue and appeasement,” the English-speaking regions of the
4, 2019. “Overall, it appears from the president of the African Union country.
their interventions that Cameroon Commission added.
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