BMI View: We hold a positive view towards Cameroon’s food, drink and mass grocery retail industriesover our forecast period, in line with our broadly positive view on the country’s consumer sector, whichis already one of the region’s most established. We expect consumer spending power to grow in line withthe country’s strong medium-term growth outlook, with growth in economic activity driven by theongoing expansion of the country’s oil industry and the subsequent inflow of investment into the market.This will feed through into falling unemployment, growing consumer confidence and increased spending.Key Forecasts
Total food consumption growth in 2012: 7.9 % year-on-year (y-o-y); compound annual growthto 2016: 9.5%.
Mass grocery retail sales growth in 2012:9.5%; compound annual growth to 2016: 15.7%.
Beer sales growth in 2012: 4.3%; compound annual growth to 2016: 3.6%.Key Trends
Population Growth: In line with the wider Sub-Saharan African region, a major factor in West andCentral Africa’s appeal to investors is its favourable population dynamics. Nigeria, with its massivepopulation, leads the pack in this regard. However, Cameroon’s population dynamics are also a majorplus point for investors. The country’s 20.0mn-strong population (as of 2011) will grow to 24.1mn by2020 and by an enormous 88% to 38.5mn in 2050. Most notable is the age profile of the population; in2012, 51% of Cameroon’s population is forecast to be younger than 20, and this provides immense longtermgrowth opportunities for regional investors.
Formalisation of Retailing: Throughout the region, our forecasts for mass grocery retail sales growthoutstrip our forecasts for food consumption growth, although it should be noted that both are broadlyimpressive. The outperformance of retail will be a result of the ongoing formalisation of the sector andthe fact that it is, in most cases, coming from an exceptionally low base. The addition of just a fewmodern retail outlets, which cause shoppers to trade up and away from traditional independent stores andmarketplaces, will have a massive impact on growth in the sector. In Cameroon, we estimate that onlyaround 2% of grocery retail sales are accounted for by the organised sector, providing tremendous roomfor growth.
Risk/Reward Ratings: Cameroon is in 10th place out of the 13 regional markets that are ranked for Sub-Saharan Africa within BMI’s Food & Drink Risk/Reward Ratings. The country scores above the regionalaverage in terms of rewards – an illustration of the massive growth opportunities available in the region.However, it scores below average in terms of risk, highlighting the challenge that investors face in fullyrealising this potential opportunity. Overall, Cameroon ranks just below the Sub-Saharan Africa averagein our regional ratings.