Structural Adjustment Programmes: Fall of Financial Support of Local Farmers and rise of Multinationals in Cameroon

1. Rural Finance
Cameroon Rural Finance
Study Case
CH.NDOUMBE
Ch.ndoumbe@gmail.com

2. The Importance of Understanding Rural
Finance in Development Studies
“With chronic poverty, inequality, population
displacement, and environmental sustainability
firmly on the international agenda, the
importance of Development Studies has never
been greater.” Professor Neil Price

3. The Importance of Agriculture in the
Development of a Country and Globally
• Agriculture is vital for people’s subsistence
– People need food; whether in China or South Africa,
someone is needed to produce the food for all to eat
• Agriculture is a massive source of employment
– Agriculture remains the mainstay of Cameroon's economy,
employing about 70 percent of its workforce
• Agriculture contributes significantly to a country’s
economy
– In Cameroon agriculture provides about 44 percent of the
country’s GDP and 85 percent of its export revenue

4. Importance of Finance in Agriculture
• Finance gives the Farmer the possibility to access other
resources necessary to operate
– Capital formation
– Increase in agricultural productivity
– Economic development to an area

5. Development Strategy between
Cameroon and France – 1960 to 1980s
• The strategy of development advised by the
French former colonial power to the
Cameroonian government discouraged
industrialisation and promoted monoculture
• On following their recommendations, the French
government provided funds and technical
assistant to the Cameroonian government for
coffee, cocoa and palm oil production

6. Structural Adjustment Programmes: Fall
of Financial Support of Local Farmers
• Global finance is regulated by two main institutions
– World Bank
– International Monetary Fund
• In the mid 1980’s Cameroon like many other countries was strongly
hit by the economic crisis
• The IMF and the World Bank developed the “Structural Adjustment
Programme” as a means to resolve the economic crises
• The decision taken by the financial institutions, as in other
countries, were intended to influence how finance was operated in
Cameroon
– Giving loans to poor people with high repayment rates

7. 1990s Appropriation of Agricultural Sector
by Multinationals
• Drastic reduction by global funding to support local farming
• Local financial institutions unable to continue providing financial aid
to local farmers
• The local financial institutions needed the repayment of loans from
local poor farmers, therefore accepted the proposed bail out by
multinational agricultural enterprises in exchange for transfer of the
land ownership (the farmers were using their land as a security
guarantee)
• Emergence of multinational agricultural enterprises took over the
agricultural activities in Cameroon for export trading – not for
provision of goods to the local consumer market

8. Destruction of Rural Economy
• The rural and therefore economy was decimated
with the introduction of monoculture and their
land ownership taken away from them.
– In Africa this increased the poverty of people in the
rural areas
• Difficulty in accessing schools, health services, etc
– On global scale
• Famine and rising food prices could spark worldwide unrest
and threaten political stability

9. Video Clip
Courtesy of Franck Gilles Brice HAMENI BIELEU

10. Question?
Within the framework of
Rural-Urban development,
who really benefits from the
systems of rural finance?

11. Sources
1.
2.
3.
4.
Changing Fortunes Of Government Policies And Its Implications On
The Application Of Agricultural Innovations In Cameroon in Nordic
Journal of African Studies 13(1): 13–29 (2004)
The Impact of Microfinance Institutions in the Development of
Small and Medium Size Businesses in Cameroon (Master’s Thesis,
Swedish University of Agricultural Sciences)
The Big Banana Movie Trailer (http://vimeo.com/23024167)
Price, N. (n.d.). Centre for Development Studies. Available from:
http://www.swan.ac.uk/research/centresandinstitutes/centreford
evelopmentstudies/