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Executive Summary

This study analyses the state of small business in Cameroon. The current state of small businesses, and the differences of small businesses between and within African countries are discussed, and some economic policy reforms proposed. This study covers various aspects ranging from the business environment, to innovation and competition among SMEs in Cameroon. The choice of Cameroon was motivated by the fact that despite positive economic growth rates (exempli gratia: 3.5% in 2017 and 3.8% in 2018), Cameroon is yet to significantly reduce the number of households living in poverty.

The World Bank estimates that formal SMEs  contribute up to 60% of total employment and up to 40% of national income (measured by the GDP), in emerging economies. These numbers are significantly higher when informal SMEs are included. SMEs are the main engine of economic growth in most developing countries. Developed countries enjoying a growing and booming economy attribute most of their achievements to a flourishing SMEs sector.

Cameroon’s vision is to become an emerging economy by 2035. Thus, the country has taken major reforms to boost the growth and development of SMEs, like the introduction of Small Business law in 2010―that was revised in 2015 and a further revision in 2017, a well-established Ministry for Small and Medium Size Enterprises, Social economy and Handicrafts (MINPMEESA) which was set-up in December 2004, and a state-owned and managed commercial bank to finance the needs of small businesses.

SMEs currently contribute only 36% of Cameroon’s GDP, though they have a potential to contribute more. This contribution highlights the co-existence of key hindrances such as payment of taxes, difficulties to access financing, administrative bottlenecks/bureaucracy, insufficient infrastructures, corruption, insufficient technical assistance, etc.

However, Cameroon is a good example for assessing the performance of SMEs in Sub-Saharan Africa because Cameroon is the biggest economy in the CEMAC Zone, and its structure is similar to that of most Sub-Saharan Africa countries.

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