For more information, see Cameroon and the IMF

Cameroon — Enhanced Structural Adjustment Facility
Medium-Term Economic and Financial Policy Framework Paper
(1998/99-2000/01)

Table 2. Cameroon: Summary and Timetable of Policy Actions, 1998/99-2000/01
Policy Area Objectives and Targets Strategies and Measures Timing
Technical
Assistance
1. Incentives policies
a. Exchange and trade system Promote external
competitiveness
Halving of nonforestry export taxes to 5 percent. July
1, 1998



Elimination of all nonforestry export taxes. 1999/2000


Elimination of import surcharges on maize meal and cement. 1999/2000


Implementation of competitiveness committee's work program. From
January 1, 1999
World Bank
b. Regulatory and domestic pricing policy Improve the investment climate Implementation of a reform of the judicial system to ensure improved enforcement of commercial and financial contracts. 1998/99- 2000/01 World Bank


Adoption of a harmonized investment incentives framework within the context of the CEMAC which relegates all tax incentives for investment to the tax code and other specific codes (i.e., customs, mining, forestry, etc). July
1, 1999
World Bank

Increase competition Liberalization of the importation of refined petroleum products, and introduction of a temporary and declining surtax to protect the national oil refinery. July
1, 1998
World Bank

Promulgation of a competition law to improve economic efficiency and to eliminate anti-competitive practices. December
31, 1998

2. Fiscal policy and public sector reform
a. Tax policy and administration Reform tax policies with a view to modernizing
the tax system and enlarging the tax base
Introduction of the VAT, which replaces the sales tax. January
1, 1999
IMF


Introduction of a property tax levied on value derived from a property registry. 2000/01


Introduction of a consolidated tax on personal income. January
1, 2000
IMF


Reduction or elimination of the remaining tax exemptions granted to eight firms in enterprise-specific conventions. 1998/99-
2000/01



Implementation of the strategy to reduce collectible tax arrears. 1998/99


Issuance of tax identification numbers to all enterprises and individual taxpayers. 1998/99-
2000/01



Strengthening of material and human resources in the Tax Department, especially the large taxpayer units. 1998/99-
2000/01


Reform
forestry
taxation to promote efficiency in processing industries and increase the sector's contribution to government revenue
Initiation of a study of the forestry sector that assesses its economic and revenue-raising potential at various stages of the production cycle, including for processing industries. September 30, 1998 World Bank


Completion of the tax verifications of the largest 20 forestry enterprises. December
31, 1998

b. Expenditure policy and management Rationalize public expenditure Annual review of composition of public expenditure particularly for priority programs for human resource development, infrastructure, and poverty reduction. 1998/99-
2000/01




Provision of appropriate budgetary allocations to government consumption of utilities to avoid the accumulation of arrears. 1998/99-
2000/01


Strengthen expenditure management so as to fight more effectively against embezzle-
ment and corruption, and to ensure that budgeted outlays reach their final destination
Strengthening of the quarterly monitoring of actual spending (locally and externally financed) by the Education and Health ministries, and the verification of delivery of goods and services, consistent with budget allocations. 1998/99-
2000/01
IMF, World Bank,
EU and France


Reinforcement of expenditure control by ensuring that managers in spending ministries are made responsible for the delivery of goods and services, and that effective ex post verifications are carried out by the Budget Department. 1998/99-
2000/01
IMF and World Bank


Strengthening of the functioning of external audit body (Contrôle Supérieur de l'Etat) and reinvigorating of its inspections of financial management in public enterprises and ministries. 1998/99-
2000/01



Strict enforcement of sanctions against agents found guilty of corruption or embezzlement of public funds. 1998/99-
2000/01


Strengthen private sector confidence in the government Adoption and implementation of a strategy to eliminate outstanding domestic payments arrears as of June 30, 1997. December
31, 1998


Modernize the budget information system Evaluation of the reform of the accounting system under way. December
31, 1998
France and IMF


Audit of the computer systems of the Ministry of Economy and Finance. December
31, 1998
France, EU and World Bank


Implementation of the recommendations of the audit. 1998/99-
2000/01

c. Public investment Expand public investment and improve its programming Agreement with donors on the composition of the Public Investment Program (PIP). 1998/99-
2000/01

d. Public enterprise reform Accelerate the pace of the privatization program in support of private sector-led growth objectives Strengthening the administrative and technical capacity of the Privatization Commission. 1998/99


Launching of competitive bidding for the privatization of SODECOTON. February 28, 1999


Launching of competitive bidding for the privatization of CDC. December
31, 1998



Launching of competitive bidding for the privatization of CAMAIR, including the regional and international air traffic rights it uses. 1998/99

Increase access to high quality public services Adoption of a new regulatory framework for the electricity sector. December
31, 1998



Launching of competitive bidding for the privatization of SONEL. June 30, 1999


Issuing of calls for tender for the final round of bidding for SNEC September 30, 1998


Adoption of a restructuring plan for the postal sector. September 30, 1998


Launching of prequalification competitive bidding for the privatization of CAMTEL, a new telecommunications company resulting from the merger of INTELCAM and the commercial activities of the Directorate of Telecommunications. February 28, 1999

Restructure enterprises remaining in the government's portfolio Publication and application of the implementing regulations under the General Charter for Public Enterprises. With effect from January 1, 1999
e. Administrative reform Improve the efficiency of public administration and the quality of the civil service Beginning of the second phase of civil service reform and increase in government productivity. 1998/99


Introduction of a merit-based promotion system and revision of the remuneration system to gradually reverse wage compression, within the limits of the wage bill. 1998/99-
2000/01
World Bank


Accelerated reduction of the civil service by limiting recruitments to budgeted positions in priority sectors, continuing departure programs, and restructuring ministries. 1998/99-
2000/01



Removal of the employment guarantee for graduates of specialized training colleges, according to their branch of training. 1998/99-
2000/01



Strengthening of training programs. 1998/99-
2000/01



Modernization of management tools, including further computerization. 1998/99-
2000/01


Improve the control and management of civil service and payroll Completion of implementation of the integrated computerized system for civil service and payroll management (SIGIPES) in all ministries. December
31, 1999

3. Financial sector policy

Strengthen regional monetary
policy in support of financial resource mobilization
and allocation
Supporting the reform of indirect instruments of monetary policy to allow interest rates to reflect market conditions. In accordance with the timetable established by the BEAC


Endeavor within the BEAC toward the elimination of the medium-term credit refinancing mechanism (guichet B). Idem

Improve the effectiveness of monetary policy in supporting the adjustment effort. Maintaining an adequate positive interest rate differential with French money market rates. 1998/99-
2000/01


Facilitate the development of money and capital markets Implementation of procedures that foster the development of a secondary market in government securities and an active interbank market. 1998/99-
2000/01



Introduction of a regulatory framework aiming to develop financial markets in Cameroon. 1998/99


Ensuring the implementation of the recommendations of the study launched by BEAC on the determination of the appropriate financial market for BEAC countries. 1998/99-
1999/2000
World Bank
and France

Enhance competition in the banking system Establishment of a regulatory framework authorizing foreign exchange bureaus. December
31, 1998



Publication of an instruction abolishing the fixed commissions set by the government for bank transactions. July 31, 1998


Issuing of international tenders for the privatization of BICEC. December
31, 1998


Strengthen the regulation and supervision of commercial banks and savings and
loan institutions
Supporting COBAC in its banking supervision activities and application of COBAC's prudential decisions. 1998/99-
2000/01



Prohibition of bad debtors from access to bank credit, participation in the privatization program, and bidding for government contracts. 1998/99-
2000/01



Scission-liquidation of the guarantee fund for credits to medium- and small-scale enterprises (FOGAPE) and development of appropriate alternative instruments. December
31, 1998


Improve the operation of the national loan recovery agency (SRC) Setting of annual quantitative targets for the recovery of loans transferred to the SRC under the bank restructuring program. 1998/99-
2000/01


Strengthen the regulation and supervision of nonbank financial institutions Publication of the implementing decree relating to small-scale financial institutions. July 31, 1998

Strengthen the regulation and supervision of insurance companies Continued application of the CIMA insurance code and strict enforcement of the rules governing prudential ratios and actuarial reserves. 1998/99-
2000/01


Reform Social Security Adoption of an action plan to reform Social Security. December
31, 1998



Implementation of the action plan. From
January 1,1999

4. External debt

Ease external debt burden Strict limitation of external borrowing and guarantees to concessional sources of finance. 1998/99-
2000/01



Negotiations with London Club creditors. 1998/99-
1999/2000

5. Other Sectoral adjustment policies
a. Energy and natural resources Provide energy
at minimum
cost
Adoption of a comprehensive strategy for the reform of the petroleum sector (exploration and production), including the respective roles of the national petroleum company (SNH) and the private sector. December
31, 1998
World Bank


Enactment of annual audits of SNH's accounts by independent auditors. 1998/99-
2000/01



Enactment and implementation of new legislation in order to promote natural gas development. December
31, 1998



Drafting of a new petroleum code. December
31, 1998



Adoption of a new mining code. March 31, 1999





b. Transport and infrastructure Reduce costs and clearance time of the port of Douala Implementation, in consultation with port users, of the action plan for the restructuring of the port of Douala. 1998/99-
2000/01



Establishment of a single window (guichet unique) at the port. 1998/99


Adoption of an action plan aiming at reducing port clearance times to 7 working days for imports and 2 working days for exports. December
31, 1998


Increase availability and quality of air service through liberalization
and
privatization
Revision of the civilian aviation code to increase competition and enhance air transport security.

December
31, 1998





Improve quality of road maintenance,
via its privatization
Implementation of the road fund, by ensuring a direct and adequate funding of the Road Fund. 1998/99-
2000/01

6. Social policies
a.
Employment and poverty reduction
Stimulate growth of employment opportunities Adoption of a revised charter for NGOs to facilitate their participation in poverty-reduction activities. June 30, 1999


Definition in collaboration with donors and NGOs of employment-generating programs for unemployed people (e.g.subcontracting of road maintenance), and improve access by women and the poor to institutionalized credit. 1998/99-
2000/01


Bring poverty reduction to center-stage in economic
policy
Publication of a poverty reduction strategy declaration incorporating a preliminary action plan. December
31, 1998



Adoption and implementation of the strategy for poverty reduction, including the poverty-monitoring action plan. Adoption: April 30, 1999
b. Education Develop human resources through an increase in the primary school enrollment ratio Adoption of an education development plan that indicates the calendar for adopting the implementing texts of the scholastic orientation law. December
31, 1998



Increase in volume and effectiveness of budget allocations for the education sector, particularly for under-schooled areas and groups. 1998/99-
2000/01


Increase availability of textbooks and exercise books Removal of regulatory barriers to the distribution of textbooks. 1998/99-
2000/01


Increase the number of good quality teachers at the primary level Reduction of the pupil-teacher ratio to less than 60 in all primary education schools, by improving conditions for teachers in underprivileged regions. 1998/99-
2000/01

c. Health Increase access of population to primary health care Agreement with donors and on an action plan for the development of health districts and their management. December
31, 1998



Preparation and implementation of an action plan to accelerate the enlarged vaccination program (PEV) in order to increase the vaccination coverage (DTC) from 45 percent in 1997/98 to 70 percent by 2001. Adoption: December 31, 1998;
Implemen-
tation:
from January 1, 1999



Increase in the volume and effectiveness of public spending in the health sector. 1998/99-
2000/01


Ensure access of population to essential and generic drugs at affordable prices Rationalization of import procedures for medications, elimination of restrictive business practices regarding their production and distribution. December
31, 1998



Information and education campaign for use of generic drugs. 1998/99-
2000/01


Improve access of urban and rural poor to basic hygiene services Guaranteeing financing of operations covered by the Special Emergency Program (PSU). 1998/99-
2000/01



Adoption of a strategy to increase supply of clean drinking water and develop sewage systems in urban and rural areas. December
31, 1998

7. Environment and Forests

Promote environment-
ally sustainable use of forest resources
Definition of areas to be declared as community forests and ensuring that adjacent communities get their revenues. December
31, 1998


Allocate cutting rights using a market mechanism Adoption of new regulations detailing criteria for the attribution of short- and long-term forestry concessions through public and transparent competitive bidding mechanisms. December
31, 1998


Ensure compliance with forest management plans Establishment of mechanisms for monitoring proper execution,ensuring that foresters comply with the management plans. March 31, 1999

Promote environment-
ally sustainable forestry development and efficient processing industry
Implementation of a forestry taxation policy that promotes high value-added industries and protects ecological systems. 1998/99-
2000/01



Review of the law relating to the prohibition of log exports. July 1, 1999

Improve coordination of production and conservation activities Adoption of a national strategy for biodiversity management and for protected zones. December
31, 1998
World Bank
8. Improvement of Statistics

Improve the presentation of budgetary data Enhancement of administrative and economic classification of expenditure and establishment of a functional classification of expenditure. 1998/99 IMF


Improve the monitoring of public enterprises Expansion of the monitoring database (SISEP) to all public enterprises. September 30, 1998

Establish an adequate poverty-
monitoring system
Monitoring of social developments through annual household surveys, detailing policy outputs in education and health. 1998/99-
2000/01
World Bank


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