GEC GENERAL ENTERPRISE CENSUS In Main findings NATIONAL INSTITUTE OF STATISTICS INSTITUT NATIONAL DE LA STATISTIQUE

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1 REPUBLIQUE DU CAMEROUN Paix Travail Patrie REPUBLIC OF CAMEROON Peace Work Fatherland INSTITUT NATIONAL DE LA STATISTIQUE NATIONAL INSTITUTE OF STATISTICS GEC 2009 GENERAL ENTERPRISE CENSUS In 2009 Main findings Summary Page Presentation note 1 Kinds of surveyed enterprises 2 Data collection summary 2 Legal forms of surveyed enterprises 3 Employed workforce turnover 4 Distribution with respect to activity sector 4 Types of accounting schemes in place 5 Age of enterprises 5 Nominal capital structure 6 Business development impediments 6 Penetration of ICT 7 Enhancement of research findings 8 Environment protection 8 Conclusion, recommendations and ways forward 8 September 2010

2 Presentation note The General Enterprise Census (GEC), carried out from August to November 2009 by the National Institute of Statistics (NIS), made it possible to identify and localise 93,969 enterprises and establishments operating in Cameroon at that period. The analysis of the results of this survey show that tertiary activities are strongly represented, accounting for 86.5% of the enterprises. The consequence of this situation is the predominance of commercial activities and the low valorisation of local resources. The modern agricultural sector is poorly represented and developed while manufacturing industries constitute the bulk of the secondary sector. Furthermore, the youthfulness of most of the enterprises reminds us of the economic crisis of the 1980s and 1990s, which caused the disappearance of many production units, especially in the primary and secondary sectors, reducing as such their relative proportion. The two metropolises, namely Douala and Yaounde, account for 60% of enterprises, 68.4% of permanent jobs and 73.8% of the total turnover. This situation explains why both cities are attractive to job-seekers and justifies the high concentration of informal sector operators. Nationals control mainly the very small and small enterprises as the capital of large enterprises is especially in the hands of aliens, coming mostly from Western Europe. It is important to note that these modern enterprises provide less than permanent jobs, to which should be added the civil servants and contract workers. The total number of permanent jobs is very few compared to the size of the active population which stands at about according to the 2009 figures. The gap has thence been filled by the informal sector, which has become the haven of young people seeking stable and well-paid jobs. Women account for less than a third of the workforce and head only one enterprise out of four. There are still important shackles to business development. In spite of the ongoing fight of the authorities against these impediments, the economic operators complain about, in order of importance, discouraging tax practices, corruption, difficult access to loans, slow administrative procedures and unfair competition. Other handicaps identified include the low penetration of information and communication technologies (ICT), insufficient use of research findings as well as the little interest shown in the protection of the business environment. The outcomes of the census constitute a rich source of information likely to reassure stakeholders as to the relevance of the economic policy mapped out in the Growth and Employment Strategy Paper (GESP). The enterprise index, which has been put in place for statistical purposes, is a database that can be used by economic operators, notably for market studies. 1

3 The production units surveyed include localisable enterprises set up in business premises. The GEC has surveyed all the modern localisable production units carrying out their activities in fixed and permanent business premises. This restriction made it possible to properly identify the formal production units because, according to the 2005 national Survey on employment and informal sector, 75% of informal workers do not carry out their activities in business premises. Some categories of enterprises such as street hawkers, open-air activities, taxis, motorbiketaxis and call boxes, were excluded from the scope of the study enterprises and establishments have been counted, 35.1% of which are in Douala and 23.9% in Yaounde Following the classification into (i) very small enterprises (VSE); (ii) small enterprises (SE); (iii) medium-sized enterprises (ME); (iv) and big enterprises (BE), based on the volume of turnover and the size of employed staff, active enterprises were surveyed, of which production units were found in Douala and units were located in Yaounde representing 59% of the total number of enterprises located in the two main cities of the country. The rest of the national territory is shared by the remaining 41% of enterprises. Concerning the structure questionnaires, 8035 enterprises were retained for data processing following the clean-up of the database. This made it possible to produce the different results tables presented in this report, the national enterprise index and the thematic reports which will be published later. Graph 1: Distribution of enterprises and establishments with respect to survey regions. The examination of the distribution by type of unit reveals that the very small production units account for more than two-thirds of all the enterprises surveyed. Very small enterprises employ at most 5 persons. Regarding activity sectors, tertiary activities come first as they make up 86.5% of the enterprises surveyed, followed by the secondary sector (13.1%) and the primary sector (0.4%). Graph 2: Distribution of enterprises with regard to their types. 2

4 89% of the enterprises are sole-proprietor enterprises while 11% are joint-stock companies. With respect to the legal form, sole proprietor enterprises account for 89% of the enterprises surveyed. Joint stock companies such as corporations (Plc), limited liability companies/enterprises (Ltd) and other limited liabilty companies having one proprietor, represent only 11% thereof. Similarly, it was observed that 8 commercial enterprises out of 10 are sole proprietor enterprises. They are mainly run by Cameroonians. Joint stock companies such as corporations, etc (Plc) and limited liability companies/enterprises (Ltd) are mostly run by foreigners, especially the French, other European nationals and Americans. Indeed, one Plc out of three and 37% of Ltd are managed by aliens. Graph 3: Distribution of enterprises and establishments according to the legal form. With less than permanent jobs provided, enterprises reveal their inability to create more jobs. The enterprises surveyed during the GEC employ permanent workers, including men (73%) and women (27%). Graph 4: Distribution of permanent jobs with respect to sex Graph 5: Distribution of jobs with respect to activity sectors and sex Even if the temporary jobs counted were added to the above figure, the total number of jobs provided by enterprises would only be , that is, 4.3% of the active population which stood at people in It should be noted that the Civil or Public Service employs workers. The limited job creation capacity of the modern sector tells of the fragile nature of the modern sector and its inability to create decent wage-earning employment for the majority of the active population which resorts to the informal sector where it carries out precarious activities. 3

5 The cities of Douala and Yaounde account for 68.4% of the global workforce and 73.8% of the total turnover of all the enterprises. Depending on the milieu, the cities of Douala and Yaounde account respectively for 47.1% and 21.3% of permanent jobs. On the economic dimension, all the enterprises realised a total turnover of billion CFA francs in The cities of Douala and Yaounde alone produced 73.8% of this turnover, which are 59.7% for enterprises in Douala and 14.1% for enterprises in Yaounde. Graph 6: Distribution of jobs and turnover by type of enterprise It is important to note that the very small and small enterprises only realised 15.4% of the total turnover, but they provide 48.7% of the permanent jobs. Meanwhile, the medium and large-sized enterprises produce 84.6% of the global turnover and employ only 51.3% of the workforce. This highlights the important role played by the very small and small-sized enterprises in job creation. Graph 7: Distribution of workforce and turnover with respect to regions surveyed. Accounting for 86.5% of the enterprises surveyed, the tertiary sector is by far the prominent one The predominance of the tertiary sector has been revealed with 86.5% of the production units surveyed as against 13.1% for the secondary sector and only 0.4% for the primary sector. Graph 8: Distribution of enterprises and establishments per activity sector. Analysis based on profile shows that threequarters of managers or promoters of enterprises are men. Women, who hold 27% of permanent jobs, only run an enterprise out of four. The reasons of this imbalance in favour of men are straightforward. According to the findings of the 2005 Survey on Employment and the Informal Sector (SEIS 2005), more women than men operate in the informal sector. The 2005 survey findings show that female jobs are in several ways more precarious than male jobs. Women more often than not lack business premises for their activities. Close to 86.7% of female promoters of the informal sector have no business premises. A lot of women operate at home. 4

6 Only a minority of enterprises do their book-keeping in conformity with OHADA norms The GEC revealed that only 42.9% of enterprises carry out a written book-keeping against 57.1% that do not keep any accounts at all. Among the enterprises that keep written accounts, only 31.1% of them keep formal accounting records, that is, an accounting that results in drawing up of a Statistical and Tax Declaration (STD). This only includes 13% of all the enterprises surveyed. This situation is regrettable because the keeping of proper accounts by an enterprise is a prerequisite of transparency and corporation governance. This means that there is still a lot to be done to induce the majority of enterprises to keeping formal and regulatory accounts. It is therefore our joy to note that within the GESP, the Government in its drive to accompany enterprises of the informal sector to migrate towards the formal sector, has undertaken to set up training aimed at helping actors of the informal sector to properly follow-up their activities by keeping simple accounting. Graph 8: Distribution of enterprises based on whether or not they carry out formal book-keeping. Most enterprises are young, 81% of them being less than 10 years old The survey has revealed that most of the enterprises are young: 81% of the enterprises were established less than 10 years ago against 0.5% of the enterprises that were created before Moreover, two-thirds of these young enterprises are sole proprietor enterprises of very small size. Besides, more than 85% of entrepreneurs are less than 50 years old. In addition, the results have also shown that many entrepreneurs display a very poor educational background as 46% of them are primary school leavers. Nevertheless, 40% of enterprises are run by graduates of higher educational institutions. Graph 9: Distribution of enterprises based on their date of creation. While very small and small enterprises are in the majority owned by nationals, large ones are mainly owned by aliens An analysis based on the nationality of the owners of enterprises, shows that nationals come first as they own 92% of the enterprises surveyed and are mostly present in the very small and small enterprises. Nigerians come next owning 4% of the enterprises and mainly manage very small commercial ventures. 45% of large enterprises are run by 5

7 Europeans and Americans. These large enterprises are mostly seen in sectors of high capital intensity such as transport, banking and insurance, agribusiness, mining, forestry and modern agriculture. Enterprises in which the majority of the capital is held by nationals employ 68.1% of the workforce while those owned by foreigners employ only 15.6% thereof. In the modern primary sector, enterprises owned by foreigners employ 26.3% of the permanent workforce against 30% for the secondary sector and 9.4% in the tertiary sectors. However, if we consider the size of the production unit, we observe that foreigners are less interested in very small and small-sized enterprises. There are more present in the medium-sized and large enterprises. Indeed, 34.4% of large enterprises are owned by aliens and employ 37.8% of the total permanent workforce of large enterprises. Enterprises belonging to national or multinational groups are few and concentrated in Douala and Yaounde. A small proportion of enterprises are owned by national or multinational group. Indeed, only 413 units are linked to a group and are mostly (more than half) found in the medium size and big enterprises. Besides, 81% of them have their head offices either in Douala or in Yaounde. Graph 10: Distribution of enterprises based on the nationality of owners. Tax and economic governance issues top the entrepreneurs preoccupations Asked about the primary shackles to the development of their businesses in Cameroon, the majority of entrepreneurs pointed to the economic environment that is less favourable to business development within the administrative, legal and financial dimensions. In order of importance, the most mentioned obstacles include (i) taxation (58.8%); (ii) corruption (50.6%); (iii) access to loans (37.6%); (iv) administrative procedures (35.2%); (v) unfair competition (25.8%); (vi) infrastructures (18.4%); and (vii) the cost of financing loans (18%). The other impediments that hamper business development include insufficient dialog between the private sector and public authorities; electricity shortages; transport; and the ill function of justice. Graph 12: The main impediments to business development (as a % of entrepreneurs opinions). These negative appreciations were made mostly by nationals (53.8%), the Chinese (57.9%), Nigerians (47.5%), the French 6

8 (40.3%) and Americans (37%). These include 56% of the owners of very small enterprises and 54% of owners of small enterprises. Indeed, the size and financial capacity of their enterprises undoubtedly render them more vulnerable. The rate of penetration of Information and Communication Technologies (ICT) into enterprises remains low at below 50% In the domain of information and communication technologies, the presence of computers in the enterprises is a common practice. Indeed only 22% of the 8035 small, medium and large-sized enterprises surveyed do not have a computer as a working tool. The presence or absence of the computer in an enterprise is not always related to the capacity of the staff to use it. Indeed, in 86% of enterprises, at least one employee knows how to use a computer. In a nutshell, the penetration of ICT in enterprises is low. Roughly half of enterprises are connected to the internet and just about one enterprise out of four has an intranet network within it. This situation might improve due to the fierce competition observed in the ICT sector as well as the slump in the cost of computers and cell telephones. Graph 11: Main ICT indicators within enterprises TIC 1 : TIC 2 : TIC 3 : TIC 4 : Access rate to computer Percentage of employees who know how to use a computer Rate of connection to internet Percentage of enterprises that have an internet network TIC 5 : Percentage of enterprises using internet for business It is the agricultural sector which draws the most from research findings Despite all the efforts put in by the Government to popularise research findings, the latter are little used. The study reveals that only 11% of entrepreneurs tap them. Research results are used by 76% of agricultural enterprises followed by mining with 30%, Enterprises do not seem to be concerned about environmental protection livestock production (29%), electricity, gas and water (21%) and agribusiness (17%). Only 15% of production units have environmental protection installations. However, there are certain sub-sectors that display a lot of awareness on environmental protection. These include agricultural enterprises (70%) own environmental protection facilities, followed by forestry enterprises (60%), mining companies (50%) and agribusinesses (35%). Apart from the forestry sector, the others are those with ISOcertified products. In this domain, where the average approaches 7%, the highest rate (29%) is observed in stock farming followed by mining (16%), agriculture and agribusiness (14%). 7

9 Conclusion, recommendations and ways forward 1 Conclusion The realisation of this survey made it possible to update a three-decade old and outdated enterprise database that had been seriously disfigured by the economic crises of the eighties and nineties. The results constitute a rich source of information likely to reassure stakeholders about the relevance of the economic policy measures included in the Growth and Employment Strategy Paper (GESP). The enterprise index which has been put in place for statistical purposes is a database that economic operators may use, notably for market studies. 2. Recommendations The main recommendations that can be made at this stage of the analysis concern: 1) The perpetuation of the information system on enterprises through the setting up of a follow-up mechanism of the enterprise sector. This should be the task, in the upcoming years, of the National Institute of Statistics and the other administrations concerned; 2) The enhancement of the findings of this census through the improvement of access to the main indicators and making them available to sector-based actors; 3) The building of partnership between the NIS and other administrative departments involved for a updating of the enterprise index. 3 Ways forward The next steps include the writing-up and publishing of thematic reports on: 1. Structural analyses of enterprises in Cameroon; 2. Which human resources for enterprises in Cameroon? 3. Business environment and competitiveness of enterprises in Cameroon; 4. Diagnosis of the Cameroonian industry; 5. Impact of innovations and ICT on the performance of enterprises in Cameroon; 6. Profile of the Cameroonian entrepreneur.* 8

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