The Economic Impact of Cameroonian SMEs on Public Procurement
From 2020 to 2023, Cameroonian Small and Medium-sized Enterprises (SMEs) have made a significant impact on the nation’s economy by capturing CFA 2.03 trillion in public procurement contracts. This remarkable achievement represents a substantial portion of the total contracts awarded by the government, which amounted to CFA 3.358 trillion over the same period.
The distribution of contracts reveals a strategic approach by the government to bolster SMEs. Public tenders, which are generally larger contracts exceeding CFA 5 million, accounted for CFA 2.747 trillion (82%) of the total procurement. Administrative purchase orders, typically smaller contracts below CFA 5 million, made up the remaining CFA 611 billion (18%). SMEs secured a significant share of these contracts, with CFA 1.474 trillion from public tenders and CFA 559 billion from administrative purchase orders.
The World Bank’s Study on the Diagnosis of SME Vulnerability and Accessibility to Public Procurement in Cameroon, published in June 2024, provides a detailed analysis of this economic activity. It highlights that SMEs secured 54% of public tenders and an impressive 91% of administrative purchase orders issued by the state between 2020 and 2023.
However, the study also points out that despite the high volume of contracts awarded to SMEs, there has not been a corresponding diversification in the country’s economic fabric. This could be attributed to the nature of services solicited from SMEs, which often involve contracts with individually small amounts and low value-added to the economy. For instance, the average amount of an administrative purchase order was CFA 2.5 million, compared to CFA 93 million for a public tender.
The majority of administrative purchase orders were for general supplies needed for daily administration operations, such as paper, ink, pens, folders, and water, which constituted 99% of these orders. In contrast, only 21.3% of public tenders were for such general supplies. Other infrastructure projects accounted for 1% of administrative purchase orders, with a larger 27% allocated to other infrastructures in public tenders, 27% for roads and road infrastructure, 18% for equipment and collective buildings, and nearly 10% for services and intellectual services.
This data underscores the importance of SMEs in the Cameroonian public procurement landscape and their potential to contribute more significantly to the economy. The government’s strategy to empower SMEs through public procurement is a step in the right direction, but there is room for improvement to maximize the economic impact. By focusing on contracts that offer higher value-added and diversification opportunities, SMEs can play a pivotal role in driving Cameroon’s economic growth and development.
For a more in-depth look at the World Bank study and the detailed statistics on SME participation in public procurement, you can follow the ongoing discussions and analyses on this topic.
