Cameroon – EU Launches 11th Phase of the Economic Partnership Agreement? Is Cameroon Ready

Introduction

The 11th Phase of the Economic Partnership Agreement between the European Union and Great Britain launched on August 4th 2026, reducing tariffs on selected products by 70%. This includes vital products like commercial vehicles, fuels, cement, paint and industrial packaging, products that will be completely exempt from tariffs by 2030. Now is a great time to remind ourselves that products in the second group were reduced by 15% in August 2017 and are now completely exempt from tariffs. This product range includes clinker, lime and marble, yeast, wire rods and electric generators, as well as trucks and semi-trailers, to name a few. These are all products that Cameroon does not produce yet or nearly enough, so should support domestic economic activity and reduce the cost for entrepreneurs.

Yes, there will be some revenue loss from lower customs duties.

Ten years after implementation, the Economic Partnership Agreement between Cameroon and the European Union has resulted in a revenue loss of about CFAF 103.6 billion, as tariff reductions reached 70% for key imported products in August 2026. Although customs duties have fallen on selected products, the government raised a record FCFA 1 trillion in 2023 as higher trade volumes have compensated for the revenue loss.

Naturally, some Cameroonians will question whether the deal is a win-win. The EPA gives Cameroonian entrepreneurs access to 27 EU markets. However, we must build and sell products that can meet the needs of a sophisticated EU consumer. We must accelerate the implementation of market-friendly reforms that will boost industrialization by addressing the large structural gaps that exist. Access to electricity, finance, and better matching opportunities will ensure Cameroonian producers are ready for international EU markets. This means preparing our producers to meet strict sanitary and phytosanitary standards as well as making sure packaging meets the demands of EU markets.

Slow Pace of Industrialization is Supporting Huge Deficit with the EU

Cameroon’s trade with the EU is dominated by cocoa, coffee and low-value-added raw materials. Meanwhile, we import higher value-added cars, electronics, chemicals and pharmaceutical products, to name a few. Research from CEPI identifies a structural deficit of 500 billion euros every year. The EPA will not materially change Cameroon’s deficit as industrialization is first driven by national policies, with imported machinery playing a marginal role in boosting industrialization and competitiveness.

Cameroon has enacted a set of reforms that have supported the private sector, but greater efforts should be made to improve matching and encourage exports that easily integrate global value chains. Since Cameroon’s independence, there has been no coherent strategy to ensure that local producers integrate the auto, defense, or electronics sector in the EU. Policymakers must be more intentional about policies that boost private sector competitiveness, use subsidies sparingly, and popularize the benefits of trading with the EU.

The Ministry of Economy and Planning finds that of the 1,021 companies trading with the EU, less than 5% of them captured the 75% tax advantages that are linked to the EPA. The same source states that 80% of the gains from the EPA went to large companies versus 20% to SMEs. This is an illustration of Cameroon’s economy that is dominated by a few large companies, underscoring the need to make trade more inclusive.

A Way forward for informal sector workers

The EPA is only accessible to formal companies, but 80 – 90% of Cameroonians operate in the informal sector. This means greater efforts should be made to link formal sector exporters and informal sector workers who can supply raw materials and other inputs at low cost. Because the opportunities are not popularized, it is difficult for informal sector workers to play an active role in shaping the EPA and improving Cameroon’s competitiveness. The suspension of value-added taxes (VAT) is a start, but we must ensure that market-friendly reforms are implemented for 5 years, not three. Ensuring informal sector workers contribute to formal chains will not slow the pace for business registration or formalization. In fact, the Ministry of Small and Medium-Sized Enterprises has reported consistent growth in the number of newly registered businesses for the last three years. We can balance inclusion in global trade while encouraging more businesses to formalize their activities. If policymakers make it easy to register and run a business, we will see more people register over th coming years. This means paying taxes and social security contributions should be easier and more intuitive.

Cameroonians will benefit from the EPA.

Inflation in Cameroon has risen above 3% over the last three years. In fact, food inflation was around 6% in the first half of 2026. The EPA will ensure that Cameroonian businesses and entrepreneurs have access to cheaper goods, including food from the EU. Lower prices and more variety give consumers choice. The ability to choose what product or service to consume is indispensable to improving the lives of everyday Cameroonians. The EPA will increase competition, which will push up innovation and drive prices down – ultimately, Cameroonians ‘ consumers will benefit from the trade agreement.

Import-Substitution and the EPA are not in Competition.

Cameroon should focus on developing its capabilities around products it can make more competitively. If flour and rice are cheaper locally, the EPA will not prevent local producers from selling their products. Policymakers should continue to focus on making locally-sourced products available. Currently, locally produced rice can only satisfy 20% of local demand, and we still import a great deal of fish and meat. The EPA is not stopping Cameroon from producing more; a difficult business environment is holding back entrepreneurship and human flourishing.

The Economic Partnership Agreement (EPA) will reduce tariffs and non-tariff barriers between Cameroon and 27 EU countries. With the EU economy experiencing structural changes, now is the time to expand trade and integrate global value chains in a verifiable manner. Market-friendly reforms – low taxes and a supportive business environment – will boost Cameroon’s competitiveness. We should focus on the opportunities in the EPA, not revenue loss. After all, there is much more to say about government waste than revenue loss from customs. The EPA gives Cameroon businesses access to cheaper industrial machinery and equipment, vehicles, and chemicals. Those can reinforce our blueprint for development and allow us to industrialize effectively. For informal sector operators, we need a simplified trade regime that aligns with the EU Deforestation Regulation as well as better matching opportunities with local exporters.

Author

Henri Kouam, Executive Director