Abstract

This study aimed at appreciating the role of foreign funded projects on the socioeconomic development of the inhabitants of the Buea municipality. The study makes use of primary data collected through the use of structured questionnaires issued to 271 inhabitants of selected communities in Buea municipality.  The main indicators of social development used were education, healthcare and portable water, while the indicators of economic welfare included employment, incomes and markets and road access.  Analyses were done through perception (descriptive) analysis and simple Chi-square and Pearson Correlations to establish the relationship between foreign funded projects and the socioeconomic development in the municipality. Findings of the study revealed that most foreign funded projects are in the domains of healthcare, education, market, water supply, road construction/rehabilitation and also that while some of the projects are completed, others are ongoing while others have been completely abandoned. The study further revealed that foreign funding in the healthcare sector mostly takes the form of free screening for diseases, vaccination of children as well as the donation of hospital equipment and that as a result of the provision of these facilities, the number of sick persons and consequently the death rates in the communities has reduced.  In the educational domain, the study finds that foreign funding is mostly in terms of classroom construction, donation of books and the provision of toilets and that as a result of the funding, the quality of learning and school enrolment levels have increased. Moreover, the as a result of the foreign funding the quality and quantity of portable water supplied in some communities has increased as well as the interactions between communities. The study equally reveals that due to the foreign funding the economic power of inhabitants of the beneficiary and adjacent communities has increased as the number of business, employment, output, income, access to markets as well as value of community assets have consequently increased. Finally, through the chi-squared and Pearson correlation, the study has established a positive, strong and significant relationship between the foreign funding and socioeconomic welfare/development of communities. This implies that as the number and diversity of foreign funding increases, community development and welfare also increases. The study thus recommends an increase provision of multilateral and bilateral assistance to communities and also for there to be increased community participation in such projects to improve on community welfare.

CHAPTER ONE

INTRODUCTION

1.1 Background of Study

The World Bank’s Country Assistance Strategy for Cameroon covers the 2010-2014 period and is aligned with the 2010-2013 Growth and Employment Strategy (Document de Stratégie pour la Croissance et l’Emploi, or DSCE using the French acronym). A Systematic Country Diagnostic (SCD) and new Country Partnership Framework (CPF) will be prepared in FY16. The World Bank is supporting the improvement of Cameroon’s competitiveness in three main areas: energy, transport, and telecommunications. It is also helping to improve the business climate and contributed to improving service delivery in three main areas: human development, establishment of a social safety net system, and local development with a focus on increasing access to basic services through infrastructure upgrades and capacity building. The Bank’s portfolio in Cameroon currently stands at $1.36 billion in commitments and consists of 23 projects. The World Bank is helping the government boost access to electricity. Electricity generation capacity has increased through the Kribi Gas Power Project. This has resulted in an expansion of generation capacity by 216 MW. The planned second phase is expected to increase the generation capacity to 330 MW by 2016.

In addition, a new IBRD project is being prepared, the Electricity Transmission and Reform Project. The main objectives of the project will be to improve the capacity, efficiency and stability of Cameroon’s national electricity transmission network. In terms of Regional Trade and Integration, The CEMAC Transport and Transit Facilitation Project is a regional IDA project totalling $680 million, out of which $409 million (62%) is designated to Cameroon and focuses on two main transit corridors: Douala-N’Djamena and Douala-Bangui. One of the main achievements is that the average transit time for imports from exit at the port of Douala to N’Djamena was reduced, as well as dwell times at the port of Douala. The road safety activities under the Africa Road Safety Corridor Initiative (ARSCI), a regional trust fund, contributed to a drop of 32% in the total number of accidents along the central corridors, Douala-N’Djamena and Douala-Bangui between 2008 and 2014. Policy dialogue and support to the civil society/NGOs led to the creation of a coalition for 30 NGOs and a partnership with the private sector led to the creation of the Safe Way Right Way (SWRW) Foundation in Cameroon. In improving Agricultural Competitiveness, The current World Bank engagement in the agricultural sector consists of two IDA-financed lending operations: (i) The Agricultural Competitiveness Project ($60 million) to increase the competitiveness of beneficiary producer organizations working on target value chains, and (ii) the Agriculture Investment and Market Development Project ($100 million in IDA funds and $25 million in IFC funds) to help transform low-productivity, subsistence-oriented cassava, maize, and sorghum subsectors into commercially-oriented and competitive value chains in four agro ecological zones.

Also, in Developing Rural Areas and improving Social Services, the multi-donor, International Development Association (IDA) funded Community Development Program Support Project (CDPSP) known in its French acronym as PNDP is an important instrument used in the implementation of the government’s rural development strategy. The project assists the government of Cameroon in setting up and implementing a decentralized financing mechanism to ensure participatory community development in rural areas and improve access to basic social services. The program has generated strong local support from the towns and communities involved. The project has accomplished the following: helped to improve school infrastructure around the country, provided 270,000 people with access to potable water, and improved the access of 20,000 households to roads and basic social services. The ongoing Health Sector Support Investment Project targets district level activities, providing financial resources and a performance-based incentive system to boost outcomes in health facilities across 26 districts covering a total population of 2.5 million. The number of children completely vaccinated has more than doubled and the number of children who received one dose of vitamin A by their first anniversary has more than tripled. The management tools used within the PBF framework engendered behavioural change among health staff and thereby assisted health facilities in improving governance and efficiencies in their use of financial resources generated through service delivery. The implementation of the Education Development Capacity Building and Education for All Fast Track Initiative (EFA- FTI) grant on education supported a number of activities to improve equity and quality of learning in the sector. The Equity and Quality for Improved Learning Project, is also supporting the transition from teachers financed by parents in public schools to Government contract teachers, providing trainings to the existing and contract teachers and providing learning materials (World Bank, 2014).

Recently, in a regular meeting in Abidjan on Wednesday, January 20, 2016 the Board of Directors of the African Development Bank (AfDB) approved a €89.291-million loan to finance the development of an Agricultural Value Chain Development Project (AVC-DP) in Cameroon. The project will be implemented in the Central Basin, which covers the Centre, East and South Regions, and the Littoral Basin, which covers the Littoral and South West Regions. It will focus on the elimination of constraints on the competitiveness of three targeted crop sectors (oil palm, plantain and pineapple) by leveraging infrastructure, crops, youth entrepreneurship and coordination to improve the competitiveness of the three crops value chains. It will also create jobs and sustainably improve stakeholders’ incomes in targeted crop sectors. It is expected to boost inclusive growth by creating jobs, especially for youths, as well as enhance food and nutritional security. The Bank will support the development of the plantain, pineapple and oil palm value chains, as a complement to the operations of the World Bank, the International Fund for Agricultural Development (IFAD, the European Union (EU) and the French Development Agency (AFD), which target other crop sectors (cassava, sorghum, maize, onion, fish, milk and pigs). The rural infrastructure development component of the project is targeting the development of 1,000 kilometres of rural roads, 30 warehouses, 15 rural markets, 30 km of electricity networks, 30 drinking water supply (DWS) systems, and a quality control laboratory for agricultural products. The youth agricultural entrepreneurship component is expected to deliver nearly 600 businesses in the agro-business sector for approximately 1,500 young graduates (40% of them women) as well as ensure access to credit. The AVC-DP is aligned with the Bank’s Ten Year Strategy (2013-2022) and is consistent with the 2015-2020 Country Strategy as well as the Bank’s action plan for African agricultural transformation. An estimated 242,000 people, 50% of them women, are expected to benefit directly from the project. These include stakeholders operating within organized structures (cooperatives and networks of farmer organizations) that engage in the targeted value chains, as well as young graduates attracted by agro-business. The project is expected to generate an estimated annual income increase of CFAF 818,000 per household and estimated annual income gains of over CFAF 6,000,000 for young entrepreneurs. The indirect beneficiaries, composed of the rural communities in the project area, are estimated at one million persons. The project will be implemented in five years. It is estimated at €115.081 million (CFAF 75.489 billion), jointly financed by the AfDB (77.6%), the Cameroon Government (21.5%), and beneficiaries (0.9%). (AfDB, 2016).

The Kumba-Mamfe Road Development Project equally articulate the role of foreign funding bodies in driving countries development objective forward. This project which total cost is estimated at UA 108.45 million with intrinsic contributions from African Development Fund’s (ADF) estimated at UA 47.26 million. The other co-financiers are the Development Bank of Central African States (BDEAC) (UA 31.62 million), and the Republic of Cameroon (UA 29.57 million). The direct beneficiaries of the project are the 1,384,286 inhabitants of the three divisions (Fako, Meme and Manyu Divisions) of the South West Region, while the people of Nigeria’s eastern States willbenefit from the project indirectly, given its regional nature. The beneficiary population will contribute to the construction, management and maintenance of some related infrastructure. This project is in line with the strategy defined in the Growth and Employment Strategy Paper (GESP) for 2010-2020 in which the Government of Cameroon reaffirms its determination to continue striving to achieve all the Millennium Development Goals (MDGs), allocate nearly 70% of official assistance to road infrastructure, gradually raise the proportion of public investment in the total State budget from 20% to 30%, and enhance supervision in the construction of visible infrastructure. Furthermore, the project is consistent with the “Cameroon Vision 2035” Paper, which considers that infrastructure development should closely comply with economic objectives aimed at transforming the country into a major trade hub in Central Africa. This road project also complies with Cameroon’s transport sector policy guidelines which lay emphasis on the importance of developing road infrastructure as a means of helping to open up rural areas, reduce poverty, improve access to basic social services, and promote regional integration. In view of its regional scope, the road forms part of the priority components of the ECCAS Central African Consensual Transport Master Plan (PDCT-AC) and will help to increase trade between two Regional Economic Communities – ECCAS and ECOWAS (AfDB, 2013).

1.2 Statement of Problem

Foreign aid funding has been proposed by a host of international organisations such as the World Bank and the UNDP as an ultimate solution that can in turn propel the developmental proper shaft in the socio-economic horizons. Like any other developing country Cameroon has been facing low economic growth rates with low income per capita in US dollar terms. The country has limited capacity to invest because of inadequate resources resulting from low savings rates and poor export performance. Thus, the use of foreign aid as a means to fill the resource gap has transcended even in the context of Cameroon reason why foreign aid constitute a significant proportion of foreign resources into the country. The main donors of such facilities in Cameroon are multilateral institutions such as the World Bank, and by individuals through development charities such as Action Aid, Caritas, Care International or Oxfam (Ngang, 2008) and countries such as Germany, Japan and France. The volume of ODA to Cameroon over the years has been fluctuating in response to the countries exigencies.

For instance, net ODA has been $608,880,000; $485,290,000; $1,959,090,000; $1,962,810,000; $551,920,000 and $729,130,000 representing 4.33%, 2.57%, 9.71%, 9.66%, 2.31% and 2.55% of the country’s GNI for the years 2000, 2005, 2006, 2007, 2010 and 2013 respectively (WDI, 2015). From these statistics, it is evident that the ODA granted to Cameroon generally witnessed an upward trend, but after a significant increase in 2003 and 2004, ODA inflows decreased in 2005 before substantially rising again in 2006 and 2007. Also important to note is the fact that two major donors (i.e. France and Germany) provide 60% of total aid to Cameroon. However, France has concentrated most of its foreign aid on financing structural adjustment and macroeconomic stabilization, due to significant public finance imbalances experienced by Cameroon during the economic crisis (African Forum and Network on Debt and Development [AFRODAD], 2007).

These funds are usually directed to areas such as road construction, healthcare provision, educational facilities as well as capacity building which are viewed to have a direct impact on the economic and social wellbeing of citizens. For instance, the Japanese are noted for having financed the construction of primary schools in the country while the World Bank has been noted for financing road construction. Nevertheless, given that most foreign funds constitute direct transfers to the governments; its impact on economic growth also depends on how it is utilized. If aid is used to finance complementary goods in developing countries, such as infrastructure and human development, its effect will be positive. But if it crowds our private investment or is used to generate rent seeking activities by politicians, its effects will be negative.

In the south West Region, a series of such foreign funded projects are noted in several of the six divisions that make up the region. For instance, the Arab Bank for Economic Development in Africa (BADEA) co-sponsored the Livestock and Fisheries Development Project hosted by SOWEDA by contributing 4,078.32Million FCFA (SOWEDA, 2007); the African Development Bank facilitated the extension of the Rumpi Area Participatory Development Project providing about 19.96 million UA (SOWEDA, 2011); the International Development Association (IDA) sponsored the supply medical equipment and drugs to Akwaya medical hospital (Manyu Division); construction of a block of latrine with three compartments at Mmembe (Lebialem); Extension of electricity to Njenawung Market to Njieh quarters (Lebialem); Construction of a block of toilet with 6 compartments (Ndian Division); Purchase and installation of 30 benches, 01 teacher’s chairs, 01 teacher’s table and 01 cupboard GPS Muabi (Kupe Muanenguba Division); Construction of a block of 2 classrooms at GPS Ndongo 1 (Fako Division), Extension of a water supply & Construction of a stand tap at GPS Bwiyuku (Fako Division); Training of four (4) council officials on the council management (CEFAM Buea) between 2012 and 2014.

Meanwhile the French Development Agency through its institutional organisation (C2D) has funded projects in the region such as the construction of a block of latrine with three compartments at GPS Wabane (Lebialem); extension of the water supply scheme and construction of a stand tap at Difenda Market (Ndian Division); purchase and installation of desalinator for the potable water in Gold Coast (Ndian Division); construction of a block of latrine three compartments at Bachountai market (Manyu Division); construction of Ten (10) Lucked-Up stalls at Konye Town Market (Meme Division) and a host of other projects (PNDP, 2015). In monetary terms, a rough estimate of projects funded in the SWR through the C2D initiative are worth 1,502,158,600FRS while IDA sponsored projects worth 883,628,570FCFA between 2012 and 2014. At present, the African Development Fund (ADF) is noted to be co-sponsoring the Kumba-Mamfe Road Development Project contributing UA 47.26 million alongside the Development Bank of Central African States (BDEAC) contributing about UA 31.62 million.

Irrespective of such huge spending the socioeconomic standing of the inhabitants of this region still leaves less to be desired. For example, the health survey by the National Institution of Statistics (NIS) for 2010 revealed that the South West Region occupied the 6th position in decreasing order of health unit possession. The region is noted to have the highest prevalence rate of malaria indicating serious health concerns admits the numerous health related funded projects. A significant proportion of the population of the region, especially those in typical rural areas still depend on streams as a source of portable water given the rarity of taps in their localities. Moreover, finding schools without teaching-learning facilities is still very common just as the distance covered by pupils to the nearest primary school still remains quite long. The economic activities of farmers and traders of the region are perturbed by the poor state of roads in most parts of the region especially Kupe Muanenguba and Ndian Divisions and the region is noted by household surveys to contain more than seven out of ten poor unemployed individuals. In fact, the fact that the region’s share in the public investment budget (PIB) is on the rise annually and the massive presence of civil society organizations, NGOs, foreign missions and their activities seems not to savage the socioeconomic predicaments suffered by the inhabitants of the region. This leaves one to ponder whether the existence of such foreign funded projects in any way alleviates the socioeconomic status of inhabitants of the 7 selected communities of the Buea Municipality in the south West Region.

Based on the above situation, this study seeks answers to the following research questions:

1.3 Research Questions

1. To what extent has the existence of foreign funded projects influenced access to healthcare in the Buea Municipality?
2. Has school enrolment rates and access to education increased following the existence of foreign funded projects in the Buea Municipality?
3. Does the existence of foreign funded projects improve on the economic transactions of beneficiary communities in the Buea Municipality?
4. Have employment levels and thus incomes of inhabitants increased following the implementation of foreign funded projects in the Buea Municipality?