Introduction
With a population of 30 million, Cameroon is truly the economic hub of the CEMAC sub-region, representing at least 28.6% of its GDP (International Monetary Fund. (2024). A country ranked among the most entrepreneurial on the continent, entrepreneurship holds particular significance. It serves as an effective means of combating youth unemployment, and helps create the wealth necessary for GDP growth. SMEs play a crucial role in mitigating unemployment, alleviating poverty, and enhancing the overall living standards of the population Of course, Cameroon’s entrepreneurial ecosystem is not without its challenges. Although the government has taken initiatives to mitigate these difficulties, they persist. This is why innovative solutions such as the establishment of mentorship networks, incubation and acceleration centers that pair them with experienced professionals in their fields, fostering knowledge exchange and professional growth have been proposed to support young entrepreneurs,(Doe, 2020). This includes support structures that offer comprehensive advice and assistance. While these are seen as a real opportunity for launching and consolidating new businesses (Gharbi and Torrès, 2013), their success is nevertheless linked to the businesses they support. In this regard, Aerts et al. (2007) reveal that the performance of an incubator is dependent on the success of its incubated businesses. What is the status of SME support structures in Cameroon? What do they offer, and what challenges do they face? This article presents the context of the environment in which support structures in Cameroon operate and the difficulties they encounter in carrying out their missions.
Cameroon: A Diversified Economy Driven by Entrepreneurship
Unlike its immediate neighbors, Cameroon has a diversified economy, which explains its remarkable resilience over the years. The country’s economic leadership is largely driven by SMEs, which currently number 393,166, alongside 787 large enterprises. The Cameroonian economy is thus composed of 99% SMEs. In 2020, SMEs already accounted for more than 61% of the country’s jobs. The two major cities, Douala and Yaoundé, host 57.4% of Cameroon’s SMEs, reflecting significant disparities in the spatial distribution of businesses across the national territoryRecognizing the importance of SMEs’ contributions to job creation and economic growth, the government has implemented several entrepreneurship development programs. In addition, the SME Bank was created, which in 2023 financed SMEs in the country the sum of 7 billion CFA francs.
However, challenges persist for entrepreneurs which have caused Cameroon’s ranking in the Doing Business Index to decline since 2016. These challenges reflect the difficulty for SMEs to survive beyond five years as one in three SMEs goes out of business. Aware of this bleak environment, many support structures for young entrepreneurs such as the Consulting Proffest, and HPS International Consulting S.A Cameroun who are operating as entrepreneurship support structures emerged alongside those created by the government like the SME Promotion Agency (APME).
Increasing Number of Entrepreneurship Support Structures and Growing Challenges
In Cameroon, several support structures, ranging from state institutions to private entities such as incubators have multiplied as a result of the entrepreneurial boom. In Cameroon, several support structures have emerged to aid entrepreneurs, including the SME Promotion Agency (APME), which provides technical assistance and funding access; incubators like Cameroun Startup Incubator (CSI), offering mentorship and resources; GICAM, advocating for better business conditions; and the Orange Social Venture Prize, supporting tech-driven social projects. While their role is beneficial for the growth of projects and the recovery of existing businesses, challenges still exist which limits the effectiveness of their actions. It is also important to clarify that there are three types of support structures: personalized support structures (incubators, business nurseries, accelerators, start-up studios), shared service structures for entrepreneurs (nurseries, business hotels), and third-place structures (such as co-working spaces). All these structures share the common goal of making the businesses they support competitive. Generally, they offer personalized advice, equipped premises, access to a network of ecosystem actors, and financial support. They can be either generalist, meaning they support entrepreneurs from all sectors, or specialized, targeting one or more specific sectors. (Pan African Vision, SBEC Forum, 2024)
Just as a doctor is not immune to illness, support structures face challenges in carrying out their activities. Over time, and given the constantly changing economic environment, businesses face new challenges that support structures must address or anticipate. As a result, support structures themselves are confronted with new challenges. Among these difficulties is the lack of financial support. From our experience at the Small Business and Entrepreneurship Centre of the Denis and Lenora Foretia Foundation in supporting SMEs in the country, many have expressed a desire for financial assistance. This request has been recurrent, underscoring a significant gap in the ecosystem that supports small and medium-sized enterprises (SMEs) in Cameroon. The lack of accessible and affordable financial resources is a major barrier to the growth and sustainability of these businesses. Many entrepreneurs face challenges securing loans due to stringent requirements, high interest rates, and a general lack of trust in financial institutions. (Dasewicz, A., Simon, J., & Ramanujam, S. R. (2020))
Next, the support offered by the structures is often generalized. However, SMEs have diverse challenges, and some require specific support. This results in overly narrow support. The support may not yield the desired results, as the initial diagnosis was already flawed. General challenges for SMEs often involve a lack of technical and human resources, which hampers productivity and innovation (López-Núñez, et al, 2020) ). Many small businesses struggle to access the necessary expertise and skilled labor, limiting their ability to compete in the market. This resource deficiency often results in inefficient operations and stunted growth prospects for these enterprises. Constraints inherent to the local entrepreneurial ecosystem, such as the level of support from public authorities for local entrepreneurs or the business climate in the country, which can also impact the success of incubators’ missions.
Recommendations
Strengthening Business Support Structures through Professionalization, Strategic Partnerships and Resource Development
To effectively strengthen business support structures in Cameroon, it is essential to focus on the professionalization of staff through continuous skill enhancement, targeted training and capacity-building programs, ensuring they are equipped with the multidisciplinary expertise and material resources necessary to accurately diagnose and address business challenges, (Henningsen, 2020). Building strategic partnerships with entrepreneurship support institutions, both domestically and internationally, can provide invaluable resources, expertise and access to new markets, significantly enhancing the capacity of these structures. Networking with counterparts within the country and sub-region allows for the sharing of experiences and innovative solutions to common challenges faced by SMEs, (Kauffman Foundation, 2021). Furthermore, investing in resource allocation and infrastructure development, including modern technology and tools, is crucial for delivering comprehensive and timely support to SMEs, (World Bank, 2022). By implementing these strategies, Cameroon’s business support structures can build a robust incubation ecosystem, fostering SME growth and driving economic development in the country.
Enhancing Entrepreneurial Ecosystems in Cameroon: Building International Connections and Strengthening State Support
Establishing a dedicated platform for international meetings would facilitate regular exchanges and foster collaboration among global and local stakeholders. This would serve as a vital space for sharing best practices, exploring new opportunities, and strengthening networks, by enhancing the effectiveness of business support structures and fostering international partnerships, (International Trade Centre, 2023). Also, given the youthful demographic of Cameroon and the increasing challenges in professional integration, entrepreneurship presents a viable solution to drive economic growth. The state should provide robust financial and regulatory support to business support structures, including subsidies and tax incentives. Such support is crucial for structures to address the challenges faced by entrepreneurs and to nurture the entrepreneurial ecosystem, (World Bank, 2021). By easing tax contributions and providing direct financial assistance, the state can help ensure that these support structures have the resources needed to empower and sustain entrepreneurship in Cameroon.
Investment in Infrastructure and State Support for SMEs
To enhance the competitiveness of small and medium enterprises (SMEs) in Cameroon, it is essential to invest significantly in resource allocation and infrastructure development, particularly in modern technology and tools. This investment will enable business support structures to deliver comprehensive and timely assistance to SMEs, ultimately fostering a more robust entrepreneurial ecosystem (World Bank, 2022; Kauffman Foundation, 2021). Additionally, the government must play a proactive role by providing substantial financial and regulatory support to these structures. Implementing subsidies and tax incentives can alleviate financial burdens and enhance operational capabilities, allowing support organizations to nurture entrepreneurship more effectively (World Bank, 2021; International Monetary Fund, 2024). By prioritizing these investments and supports, the state can significantly improve the business environment, encouraging innovation and growth among SMEs, which are crucial for economic development.
Conclusion
In Cameroon, the numerous support structures established to foster an entrepreneurial ecosystem play a pivotal role in enhancing the efficiency and resilience of local businesses. However, significant challenges, including generalized support, lack of financial resources, and inadequate technical expertise, hinder these structures from fulfilling their missions effectively. The recommendations provided address these challenges comprehensively, and if implemented effectively, they could transform the entrepreneurial landscape in Cameroon. By professionalizing staff, forming strategic partnerships, investing in infrastructure, and receiving state support, the challenges currently faced can be surmountable, leading to sustainable economic growth and development.